Old-School Arcade Games on Demand: How the Sharing Economy Might Save Pac-Man and Donkey Kong

Categories: Video games

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Even after Nintendo and Atari put home video game consoles on the market and induced gamers of the '80s and '90s to barricade themselves in their bedrooms, a few diehard arcade operators still did things the old way. And their die-hard fans continued pumping quarters into the refrigerator-sized machines, ensuring that Donkey Kong and Ms. Pac-Man would still have a place at the local movie theater or bowling alley. Home systems put a major hurt on the arcades, and then smartphones came along and ate up a few more lives. Suddenly, everyone had Angry Birds right at the tips of their fingertips, and many gaming companies doled out their apps for free.

Old-fashioned arcade games -- with their coin slots, hokey plastic guns, and grainy color palettes -- gathered dust and graffiti, and had all the appeal of an ice box that hadn't been touched in years. Renting them out to arcades was a horrible value proposition, says Antioch stockbroker and old-school gaming enthusiast Seth Peterson, who mourned the changing times. You might earn $15 in quarters, $7.50 of which would go to the house. You'd spend $10 on gas just to cart the machine over.

Peterson couldn't stand to see a whole industry waste away, so he decided to become its savior. Last year he bought and refurbished an old Turbo Outrun arcade game from a vendor in Stockton, and used it to start a business. He thought that by buying arcade games in bulk and leasing them to private clients for $75 a month, he could resurrect an old tradition without subjecting it to the dangers of the outside world. The games in his collection wouldn't wind up in random bars or laundromats; they wouldn't get vandalized or eviscerated.

He and his brother bought classic games in bulk, and wound up with a 150-game portfolio that they could rent to customers in the San Francisco and Sacramento areas. (Think of Netflix's business model, only way bulkier; cute envelopes won't cut it here.) They also created a website to facilitate rentals for other game-owners, using a sharing economy-type system. Any owner could post screenshots of his game and the maximum number of miles he'd drive to deliver it; customers within those zip codes could then respond And presto: Joust brought right to your door.

"We think it's a great way to make the games earn income again, and help save a dying industry," Peterson says, noting that he's also providing opportunities for mom-and-pop operators. Before he and his brother launched their business -- called All You Can Arcade -- the few companies running arcade rentals had a virtual cartel.

"When we looked at the rest of the market, the cheapest guys were charging $200 for a 4-hour rental," Peterson says. "Good games would go for $500."

All You Can Arcade debuted this weekend at the California Extreme Arcade Convention in Santa Clara, which is kind of a Rose Bowl for old-school nerdery: With more than 500 arcade and pinball games on hand (and no quarters needed!), it's one of the few exhibitions that will dwarf Peterson's collection.
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