Update on my arcade, The Game Grid (8/29/08)

It’s been a little while since I did an update on how my arcade is going and I’ve had a few people ask about it so here we go.

We finally got a sign put up a week ago, something that should have been completed two months ago when we opened but was delayed due to waiting on approval from the mall, the city along with production and a few other things. It certainly hasn’t helped that I didn’t have such visibility until now but I’m glad it’s finally taken care of. Unfortunately it is already falling apart, one of the buttons that was on the box broke off and disappeared over the past weekend, which I am not happy about. They are supposed to get it fixed, but I have to wait, yet again.

Another thing that hasn’t helped is the fact that our air conditioning has not worked since we opened so basically we’ve gone the entire summer without AC. I have been fighting to get it fixed and fortunately I am not going to pay for the repairs but that has meant that I have had to sit and wait and watch people go out the door when it’s sometimes hotter inside than it is out. It also has made it uncomfortable to be there all day but also about a week ago that was finally fixed after the entire unit was replaced. That certainly has helped make it pleasant to be inside for once.

I have had some great regulars that come in just about every day and part of that is due to the PC LAN. But it is working out like I planned – they play both the PCs and the arcades and in some cases they have been exposed to arcade titles that they never would have cared about otherwise.

Hit the post break for my musing on game earnings, games breaking, marketing, school starting and what to do next.

Game earnings are interesting as every week it seems that I have a new game which makes more than others. I have been surprised by the fact that Indiana Jones has been the best earning game for three different weeks, although this past week it was beat out by Shrek and several other games. Getting Street Fighter II was a good move – this past week it made more than KOF98 and Marvel VS. Capcom combined. Tokyo Drift has been pretty consistent in it’s earnings without much fluctuation. While Movie Stop is generally ‘expected’ to do well since it’s redemption, there have been weeks where it killed and weeks where it did terrible.  It just really depends on what people want to play when they come in and what they are a fan of. Unfortunately my House of the Dead 4 is out of commission – the screen just does not want to stay on and according to Sega it’s the lamp which when I checked is only going to cost me $509 to replace (unless there is an alternative out there). I am thinking that it could be a power issue though so I will work on getting that checked first. I have quickly learned that if there is one place that gets your pocket book is the parts side of the arcade industry as many times parts that should be two to three times less are jacked up. I’m sure some won’t be happy I said that but it’s true. I’m also waiting on parts to get my T-Mek completely fixed, a lot of people have been interested in that one so I can hardly wait to get it fully up and running but at least one side works for now. I also am going to try an experiment with mt Carnevil – I have purchased a CF-to-IDE adapter to I can replace the hard drive with a Compact Flash card which should be far more reliable than a 10 year old HDD. I’ll let you all know how that turns out, if it works I’ll have to do it for my Gauntlet as well. Also one of my Tokyo Drifts has been having issues – one day last week it just started crashing everytime it got to one certain point in the attract mode. I restored the machine and it had been fine until today where it crashed once during a game. It hasn’t crashed again but I’m wondering if it’s going to keep being a problem. At least it’s only one of the two that is doing this.

As far as marketing goes, Facebook has been working out OK and brought a few people in; I am still waiting on my flyers and my Pizza Hut coupon book to arrive and start making an effect which I am sure will do well. I am not happy about the Pizza Hut book – that advertising was supposed to start running a couple of weeks ago but it has yet to show up. I have called Pizza Hut’s marketing dept. and contacted the ad agency who set the whole thing up and it’s going to be ‘resolved’. We’ll see. School started in most areas this past week and I have certainly felt it – this week has been very slow, especially compared to last week. While I am targeting an audience that is a little older, most of my regulars have been teenagers, with a few exceptions. Of course Utah has a huge youth population so it’s natural that most of my customers will come from that group. I also am thankful for a brief mention I got on Kotaku a week or two ago and for a little coverage I got from the excellent site Arcade Finder (which has grown quite well since it started). Next thing I need to do is join the local Chamber of Commerce and continue to have competitions. We had a CoD4 competition a couple of weeks ago where we just awarded extra hours on the LAN and it was a huge success that brought a lot of people in, we’re going to hold an Indiana Jones competition tomorrow and the week after that I am thinking of  CoD4 again since it is quite popular.

So that’s where we’re at right now, it’s been a bumpy ride so far but I think that it will continue to grow but I can’t help but feel anxious with the slowdown that has hit with school starting. I have someone willing to invest an additional $10k into my business and I am taking that under serious consideration but it’s hard to decide what to do with it – buy more PCs, buy something big like SFIV or hold out to use it for rent payments? As irritated as I am with how SFIV has been handled I cannot ignore it’s popularity but at the same time I don’t know that $10k will cover that. I also have come across a deal on a Tsunami Motion cabinet for a killer price that I thought I had missed out on but it hadn’t sold yet. There is also a DDR game that just arrived at my distributor but in addition to being expensive, it was one of the worst earning games at the location it just came out of (it was an Extreme + version, I don’t know if that has anything to do with it).

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25 Comments on “Update on my arcade, The Game Grid (8/29/08)”

  1. RJ Kirkevold Says:

    I’ve been reading this blog for quite some time, and I’m inspired and amazed at the dedication and work that you put out in order to actually run an arcade. If I lived in Utah, I’d spent too much time at your place – even if Carnevil creeps me out.

    I wouldn’t spring on DDR Extreme. It’s looked down upon by most DDR fantatics – but to the general public, it might be ok.

  2. neil brimelow Says:

    $10,000 for an upright arcade game in 2008 in INSANE. A 32 inch HDTV is running less than $600 and a PS3 is running $400. SFIV on the PS3 is going to cost $50.

    So let’s be conservative, and round the number down to $1,000 total and add $500 for the cabinet and coin mechs. That equals $1,500. Software cost is irrelevant, as SFIV is designed for the home market first and the arcade market cost second.

    $3,500 to $4,500 would be a MORE than reasonable number for the cost of an arcade unit. $10,000 is FARKING crazy. Capcom was founded as an arcade company and it’s a shame that they have forgotten their roots.

  3. Shaggy Says:

    Thanks for the comments guys, I appreciate it.

    Neil, I completely agree with your assessment and I’ve stated many times before how I despise the model of forcing operators to buy two units which drives costs through the roof. That and the console release is about six months away which gives you very little time for ROI – but on the same dime I am hearing about how much enthusiasm there is for the game by players out there and my distributor has told me that they are receiving several calls a day now from people looking for a place to play it. It would really help me right now to get something that will bring in the players which is the only reason I am considering SFIV. Still, I continue to get sticker shock everytime I sit down and think about it because to get two kits you’re looking at probably $5000-$6000 as you also need the Type X2 I/O board and then there’s shipping, then you need a good cabinet to put it in, preferably an HD cab which are not easy to come by – I still curse Capcom USA for dropping the ball on this.

    The Tsunami motion cab is looking like a good alternative – it’s not SFIV in popularity but it has motion, several games and I’ve been offered the game for less than $5000 which is a killer deal when you look at one of these new.

  4. Shaggy Says:

    I just checked Legend Company (who I got Oriental Legend 2 from) and they are asking for $6100 for one SFIV kit and that’s without the I/O board! If that’s what everyone is having to pay then definently forget that! I had thought that the kits were going to be $2300. Coinopexpress has them but they don’t list a price, at least it comes with the I/O board.

    I wonder if SNK will have KOF XII out soon, that and BlazBlue are looking more attractive all the time. I also am hoping to see Dark Presence soon, they are shooting for Sep/Oct for a release…

  5. editor Says:

    Shaggy, the KOFIXII is on the Taito TypeX2 and they are looking at the same prices!

    Taito are in deep conversation with distributors towards finding a strong route into the international scene with a good price.

    Can I remind all, the price of an amusement machine is based on:
    – shipping (freight air or sea)
    – safety (having the board FCC rated)
    – hardware (special interface board and monitors)
    – servicing (distributor spares support)
    This is not chucking a Xbox into a wooden cabinet, public use machines are licensed specifically and have to be rated.

  6. Molloy Says:

    You should send someone out to all the schools and colleges to stick up fliers.

  7. Bill Says:

    HOD 4, yes, your game is showing the usual symptoms of a failing lamp. They eat a lamp about every 8 months on our route. Do not buy the lamp from a distributor! It is PPhillips part no. 6912B22007B. You can get new ones occasionaly on Ebay for between 60..00-100.00. We always keep several in stock. With any game with a DLP monitor, the first thing to do is crack the part number code. Otherwise, buying lamps at the game manufacturer price will break you.
    You are not alone on the Tokyo Drift problem. We have had to replace 9 computers already on the kit versions. Sometimes it is the flash drive, but most of the time it is the computer. They will always hang up in the same place during game play, or the same place during attract mode, where it will eventually reboot itself and freeze up all over again. But rest assured, we know the great people at Raw Thrills will find a solution for this eventually.
    Yes, the SF4 kits are really that expensive. we have had a set up and running nearly two weeks now. A great player draw, as they are lining up to play. The big question remains if we can recoup before the console version release? I am not so sure this will work out, but still fun to have something to create excitement that we have been lacking lately.
    Just my thoughts,
    Bill

  8. Bill Says:

    Shaggy, one more time here for me today. Regarding DDR Extreme, is is still a great earning game for us. We imported dozens of these units, and they have been great. The reason it was not earning for someone may pertain to maintenance issues. The foot pads must be sensitive and perform flawlessly. If well maintained, that niche player community will give you great support as most DDR machine are not well maintained. With one that is taken care of, they will flock to your location most likely. Just be aware, while a Super Nova can be tempting, there is a support problem for the frequently failing board system that runs it. Ours go down every 10-14 months, requiring a 900.00 repair from the distributor that has proprietary distribution rights. We are getting nailed here! The game does earn well enough to spend 1000.00 average per year with shipping for this regular repair, and they will not selll you the parts for the do it yourself operator. And now come to find out, we could have repaired these in the field ourselves! I will probably get in trouble for saying tjis, but we have just figured out how to reset the hard drives, using a simple PS controller and pressing one button! Argh, 900.00 to pay the distributor to press a button? No wonder this industry is getting tough. This is the same distributor who will not admit when TD is coming soon as a kit, and knowing it is the entire time. I better shut up now, as I am getting off topic with my rants.
    best to all, Bill

  9. Shaggy Says:

    Editor – At the very least SNK isn’t being ridiculous where you have to but two KOFXII kits though 😉

    Molloy – I do have some fliers that I have been passing around, none at the schools yet which I need to do, that’s for sure.

    Bill – thank you for that part number! That will be a life saver. I don’t know what Sega is thinking or smoking by doing what they do with parts.

    I do hope that Raw Thrills will get the issue with Drift fixed, that is not a good track record to have units failing like that and when they are so new.

    It’s the whole SFIV creating lines thing that I am most tempted by. Still, like you said, who knows if it will make up the cost in six months or so. Of course who knows exactly how it will do after the console release but it certainly won’t see lines after that.

    Interesting info on DDR there, it’s stupid at what they charge us to do for things that are so easy to repair.

    I’m leaning towards that Tsunami cabinet the more I think about. No other arcade int he area has a motion cabinet so that might be an advantage although I wonder about repairs on that too…

  10. Bill Says:

    We have done okay with our Tsnumi motion cabinets. But moreso in a transient type location, like movie theatres and amusement parks.
    I would not worry much yet about the failure rate on the TD kits. I have uber confidence in the good people at Raw Thrills. They really do care about this industry, unlike some others.
    On the Street fighter, I can only gauge what will happen with earnings while comparing it to Tekken 5. We did well with Tekken 5, but earnings did reduce by 70% within several weeks of the console release. But when we recieved the DR upgrade enhancement, earnings did rise again for awhile.

    Good luck to you on your endeavor.

  11. Blaine Says:

    Hmm…

    There’s no getting around the fact that SFIV would be a money maker. People are willing to drive hours just to get some time on one. Also, the prime earnings time for it gets shorter by the minute as the inevitable console port creeps up each day.

    Not sure what to do, really.

    Any option would be to get a Taito X2 kit and hope for the hard drive and dongle to start making their way 2nd hand.

    On ArcadeOtaku.com a distributor is offering BlazBlue kit for $7,000 shipped.

    -Taito X2
    -Blazblue Hard disk
    -Dongle
    -Vewlix-L cabinet

    Granted it’s still $7,000 but it’ll be a really, really eye catching game. High res 2d on a Vewlix

    And maybe in a month or two you’ll be able to get a SFIV hard drive cheaper

  12. Molloy Says:

    There’s no point making yourself completely broke over one game. There are lots of fighters that are cheap and would keep your competitive Vs players happy. I’d say if SF2 is going well for you buying Super Turbo would be top priority. If I recall you said you had Championship Edition or something that people don’t tend to play anymore. SF3 Third Strike and KoF98 would go down well with that audience well also.

    I’d rather there were a couple of new games on rotation every month I go to an arcade than have to wait 9 months for the operator to refresh his machines with gimmicky motion cabinets.

    But that’s just me. God knows the tourists/shoppers won’t touch anything with a joystick. If it’s not a steering wheel, lightgun or something regonisible they run a mile.

  13. Phil Arrington (Phil ver Zer0) Says:

    You can do a lot with ten grand but for the moment its better to build up the arcade by getting a few new games as well as some cabs if you can. If you were in LA right now, Jesus Christ, you can do a lot with that kind of money (When someone sells a X-Men 6 player cab for 180 bucks….that’s just unbelievable) If you can check your craig’s list in your area or other areas or states as well as Neo Geo.com if you’re looking for some new stuff to put in without spending much.

    SF:IV is worth it, but its better to have wait and have patience. Super Arcade got a SF IV that’s working out for them…too bad that’s all they got (beside Tekken 6) and have a arcade full of broken down games and sticks.

    As I said, you can do a lot with ten grand, however, money like that should be saved for a rainy day.

  14. Shaggy Says:

    Yeah I have thought of BlazBlue. That comes out in November though when a bunch of other new games are coming and I am quite curious to see what’s going to happen. BTW- I was told by ArcSys that there should be an alternative HD cabinet from the Vewlix that they might have that is a little bit cheaper.

    Speaking of the Tsunami cabinet, apparently it’s in LasVegas and the seller doesn’t want to ship it so I’ll have to drive down and get it. He’ll pay for a hotel stay so that has me thinking – I could go to AMOA if this is the case. I’m not crazy about driving a truck down to LV though…

  15. Dave_K. Says:

    Thanks for the detailed update Shaggy, we are all pulling for you here!

    On the topic of vewlix, the cheaper L and D model comparisons can be found here: http://www.arcadeotaku.com/forum/viewtopic.php?f=3&t=139

  16. Shaggy Says:

    Interesting, thanks for the link. From what ArcSys said, they are actually looking at an HD cabinet that is not Vewlix at all but something new that someone in California is making. I’m hoping that we can find out more about it soon – I do like the Vewlix but if there is something that does the same thing for cheaper then I’m all for it.

  17. ashley Says:

    Hi im interested in getting tokyo drift kit,but i cant seem to find a list of cabinets i can convert,anyone here know?Thanks

  18. Stevie C Says:

    Gday mate,
    Save your money on the SF4 and put it into Redemption machines. Street Fighter will be all forgotten about in 12-18 months and you may only just break even. Redempton machines will still be earning strong in 10years from now. Talking from 15years experience as an operator. I know is hard to not get caught up in the hype but try not to, I have never ever regret buying any redemption machines, and the good thing is they have really good resale value. I bet Street Fighter has’nt. I won’t be touching Street Fighter there is buch better machines around to spend your cash on mate.
    Arcades are hard work but a good Redemption Set up will always pay the rent.
    Gday from Australia, love the site.

  19. editor Says:

    Stevie, I would have agreed with you until it was revealed that the consumer version of SFIV may not have tag, customization and network battle features – Capcom are rushing to allay fears but you can see the panic in their eyes.

    Now with the news of the VEWLIX-L cabinet and a new release (ultra secret) of Street Fighter IV: Version 2 (extra features and new character), then I see at least a good nine months of revenue from this game, s if a cheap cabinet and new update unique to arcade is release its worth.

  20. ashley Says:

    Definatly look at more redemtion,the days of an arcade soly relying on video games are almost at an end,when i first opened my arcade 2 yrs ago i struggled all the time xcept school hols till i got ticket games direct prize games ,i would now buy a new ticket game before id spend money on another video game,i think a really good arcade would be just redemtion,im thinking about it no games at all just prizes like at the fairs :)there are better games out there than sf4,i wouldnt even buy tekken 6,anything to do with console games keep well away from once they are released on a console,ya dont make much and lucky if u get your money back.
    the money just rolls in with redemption just like the old days before consoles,do some homework goto an arcade with redemption look were all the money is going and decide for your self.

  21. ashley Says:

    id also like to comment that the fella up further is right,i have 6 lowboy 26″ cabs with sf world worrior,sf 2nd impact,2 slot neo geo,tekken tag,ultimate mortal kombat 3,and a naomi setup,only one that brings in money is the sf games,world worrior the most.im in the process of selling them off bar 3 one im kepping for my self .the kids have told me they wont play on those type of cabinets only the megalos ,i have tested this and a polular game like virtua tennis 2 in a megalo earns well but i put it into an upright not a dime,strnage aye people are funny but do listen to the people who come to your arcade they do make some sence all my other games are shooters driver pinballs airhockeys and redemtion,if u havent got a dragon punch yet GET one straight away they earn massive amounts of money and u can run competitions for tokens for the highest punch of the day or beat a certain score to win free time on ya pc lan gaming,or get get a basket ball game another big earner kids love shooting hoops,forghet the video games for now look at what else there is on the market,but def get a dragon punch i still cant belive how much it earns,2 yrs and still going strong,i dont know many video games that can do that apart from daytona.also look at getting a drink machine for the next summer ,it will do well i have also just bought a pop n go popcorn machine,another excellent earner 80% prof as u can see im not focusing on just video games u need a bit of everything :)just my 2 cents to pass on to another new guy in the coin op biz

  22. Stevie C Says:

    Mate 9 months of return or 10 years of good return. HMMM. I would also fully agree with ASHLEY. I have had a Dragon punch for over 12 months and boy can this thing earn. Mine is in a pub and makes heaps. I reken you have enough video games in there now, really think hard about going full on with TICKET Redemption and a really good prize counter you will not be sorry.

  23. Shaggy Says:

    I understand where you are coming from with redemption but my focus will stay on the video games. While it is tougher to do that, my PC LAN has made up for any money I would have made with redemption and in some cases more. But with that being said I’m not 100% anti-redemption, I don’t mind things like Movie Stop or Stacker because the prizes are better and the players feel more rewarded by the experience. I have thought of getting a Dragon Punch but if it had a ticket dispenser I’d use it to trade for minutes on the LAN or so many tickets for a token so they go back and play the arcades. 🙂

    I fully believe that a video based arcade can work in today’s world. What it comes down to are the games and that’s the tough part is finding games that people want to play. Naturally as operators our hands are tied by the developers and what they release and it also depends on what people in your area are into. The fact of the matter is that there are many people out there who like video games and they just need to know about it at the arcade. Like I have said, there have been several weeks where Indiana Jones Pinball has been the highest earning game in my arcade, which goes against everything you are normally told about arcades and pinball. All of my fighters have been consistent in earning well as Tokyo Drift has. I do have a few games which are making nothing, such as ninja Gaiden, Superman and Mars Matrix but when I come across something else I’ll switch those out for something different and see what happens. But with my LAN it has helped me stay afloat on days where the arcade doesn’t do well but there have been days where the arcade has outearned the PC LAN. Once some advertising with Pizza Hut starts in my area it will definently help boost earnings. We are already very close to breaking even from last month’s earnings which is impressive considering that other stores in the mall have made less than I did because of the construction in the area.

  24. Rooks Says:

    I am kind of late to the party here, but I was wondering if anyone knew of any message boards or websites where arcade operators can discuss business information. For example, I am researching an arcade / bar to open in my city, and am seeking advice on questions such as what games are best to get, how sturdy are games like Dragon Punch or does it break down easily from everyone hitting it, does anyone else operate an arcade / bar format business? Any help would be great.

  25. Stevie C Says:

    I operated a Licenced Arcade here in Austraila. It was OK, nothing great. Pool tables were the key to to working. I had mine open during the day for the kids that were under age for drinking, and just sold them Coke etc, and this really helped to keep us going. We ran all the Classic type machines and some new, 4 seats of Daytona, Buck Hunter etc. This is not a business you are going to get RICH out of but it’s good fun. If you can get an opertor to put in the bulk of the machines it will minimise the risk for you.
    Dragon Punch to a really good investment, it will hold up enough for you to make some good money before you have to replace the punch ball or the sensor.(It is a simple design really).I would recommmend getting one. One thing I did’nt do was run Full size basketball machines in the Bar/ Arcade and I think this would of been good. It’s not all about the games you need to be aware that you are a bar as well, it needs to be a good quallity bar that people will drink at even if they are not playing games. Then you also have the problems with owning a bar( Drunk people).

    Good Luck


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