The Life and Death of the American Arcade

In 30 years from now, will the Xbox and iPad be considered retro?  The arcade machines of the 1980s have certainly taken on that label.  What was once a public activity and popular hangout spot was replaced with home computers and personal Gameboys.

However, long before home computers were a household item, the arcade industry was having problems. After the Pac-Man bubble burst in 1983, the market crashed. Simply put, the industry reached its saturation point; there were just too many arcades with owners ordering more machines than their players could ever support.  The arcade industry relied on novelty and the latest and greatest games soon went out of fashion. There were only so many quarters that a player could pump into a machine before he mastered the game and moved on to the next challenge.  People played arcade games to win and once they’d won, they were done.  Game manufacturers of course responded to this by making new games harder, yet this ended up excluding mainstream players in the process.

In reality though, it wasn’t the complexity of the games that killed the arcade industry, more the public’s fears over the impact of gaming on our nation’s youth.  The arcade was seen as the place for loitering delinquents to misbehave. Many parents believed that the arcades were run by the “scum of the earth”, teaching gambling to their children and encouraging aggressive behavior which could lead to criminal activity. As early as 1983, psychologists were talking about the harmful effects of video games on children, specifically their addictive nature.

While arcades were REALLY popular in their hay day, the actual “golden age” of video game arcades only lasted a few short years.  Gaming revenue, which had peaked at over $12 billion, sank to $100 million by 1985.  While the arcade industry didn’t die there and then (and featured many comebacks over the next couple of decades), it became obvious that the economics were no longer there (gaming companies make a fortune in the home).

That’s when the graveyard of arcade machines emerged.  Dubbed as vintage and retro, it became cool to recreate the 80s arcade with video game rentals at your own event, especially among those who actually experienced the arcade era and spent time in their local arcade.