Massive Multiplayer Gaming Warehouses On The Way

hephaist0s writes "A company called Holo-Dek Gaming has opened a gaming center in New Hampshire where $5/hour buys gamers a 73-inch high definition projection screen and a networked Alienware PC or or Xbox. More impressive, though, are the prototypes for their 180-degree gaming theater... and their game sphere. Yes, sphere. This is just a pilot program--the Baltimore facility planned for 2005 would have 300 networked gaming stations. Story and pictures here, company website here."

Re:But could you...

If you look at the article, it shows that the "73 inch screens" are nothing more than Alienware computers hooked up to a projector, and with the user sitting about 3 feet from the wall. I don't know what could be inside the "game spheres", but the 180 game screen looks very cool. Plus, realistically, you see a lot of things through your peripheral vision; your actual center field of vision is very small (if I remember correctly, roughly 5-6 cm in diameter). I really like this idea. It reminds me of the story that was on Slashdot a while ago, about having video game tournaments at movie theaters.

the return of the arcade?

Didn't arcades die because you could finally play the same games with the same quality at home?

Re:the return of the arcade?

Arcades are still VERY big in other countries besides the US. In London there are tons of 4 and 5 story arcades, each with a bar at either the bottom or middle.

In other countries they focused on the adult crowd, for some reason America missed the boat on that...

Re:the return of the arcade?

It's called Dave and Busters over here. Adult adolescent behavior is something the US will never be short of. However there aren't tons of these - seems 30 something American men like to spend their paper dollars at titty bars over coins in an arcade.

Ahh, grasshopper

You need to pay the man at least $500 and then ask for the "interactive room".

If you get in, then you can get whatever booze, smack, or blow you want to go along with your choice of "interactive partner". Natrually, nothing in the interactive room is free; the $500 is the weed-out money to keep the riff-raff from even asking.

Wow

Cool how much to buy a porno sphere for home use? And how do I write it off as a business expense?

The end of "cyberstores"

I don't know about you, but when I want a LAN party with my friends but don't actually want to have to coordinate and set up a LAN party, I go to "cyberstores", where you pay maybe $3/hour for a pretty decent computer all hooked up and ready to play games.

Well, hell- if you can get an Alienware all LANned up (don't even get me started on the crazy screens) for only $5/hour, these little LAN businesses will surely die.

Not that I don't support these warehouses, where I will surely blow hundreds of dollars.

- dshaw

I'm not impressed...

Until I see a gaming Dyson sphere!

Too much

If you've ever looked at a clock while gaming, you'd see that the hands move much faster. 1 hour goes by in a snap. More importantly, it's more expensive than a movie, and movies are designed for the time period, pack more into them, and are generally more interesting.

I have a feeling that the type of person who would do this aready owns an alienware and a hdtv...

Re:Too much

If you've ever looked at a clock while gaming, you'd see that the hands move much faster.

Oddly, the exact opposite is true when I'm playing defense in a UT2004 Assault map.

Uh the bulbs..

If the projector bulb lasts 1000 hours, you would need to sell 100 hours alone just to cover the bulb cost.

$5

Does the $5 dollar rate include some deodorant or soap kit for the unwashed masses?

Someone needs to build one of those here...

...NOW.

Sexy Dyslexia

Did anyone else read that headline as "Massive Multiplayer Gaming Whorehouses On The Way"?

$5/hour just seemed wrong for that.

Re:Sexy Dyslexia

Surely you mean Sexlexia?

I don't see this picking up

Arcades are dead and PC Baangs (it's the korean name for those cybercafes where you can play games onLAN/online) are nowhere near as popular as arcades were back in the day.

Now I can see how these warehouses with their alienware pcs and nice screens (most of them are "only" 73 inches) would appeal to the same crowd that plays FPS and Strategy games and goes to LAN parties but that crowd is very very small compared to the overall gamer's market. Heck, the whole PC game market represents less than 20% so you can imagine the actual percentage of people who are fond of those games.

The idea just doesn't seem to have enough appeal to snowball into the next big trend. I know it doesn't appeal to me. For the cost of a handful of gaming sessions, I can buy a new $200 graphic card and play the same games on a respectable 20" monitor (ok, so I already own that) for as long as I want, in the comfort of my home.

This is not to say his isn't a valid business plan. The center can be profitable if the location is good and the marketing is done right. But that's only in the short term. Once the newness evaporates and those alienware rigs aren't so hot anymore (replacing 300 alienware rigs will cost you a cool $100,000) , I predict a steady decline into oblivion.

Re:I don't see this picking up

From the article itself:

Video games sales in 2003 exceeded $7 billion, according to the Entertainment Software Association-double the amount sold in 1996. There were 239 million games sold, $5.8 billion in console games and $1.2 billion in PC games. 1.2 out of 7 is about 17% (less than 20%). Therefore, The pc game market represents less than 20% of the Overall game market.

Typos

Alienware PC or or Xbox Santa, I want a new slashdot editor and a speelcheck for christmas :D

Unsure of their financial viability

I own a cybercafe in colorado, and I'll tell you from first hand experience that the gaming community, although incredibly loyal and a ton of fun, cannot financially support such a behemoth.

300 Stations? I know there is one place in NY (??) that has something like that, and the only reason they are in business is because they /Don't/ cater to gamers, but instead to the joesixpacks.

Sure, the coasts are a lot more populated and have a higher per-capita of hardcore gamers who will pay to play, but with only ~20 stations, it will take them a -long- time to break out of the red incurred by the initial investment. We've been open for 14 months now, and we're still paying off our $1200 PCs, and we're the most popular gaming center in town! We charge $3/hr for members, and $4/hr for walk-ins, and we get by with very modest paychecks. We would surely be unable to stay open if our *screens* costed $1k apeice, not to mention the $2k+ alienware boxes they have, even at $5/hr.

It's a great idea, but man. Good luck guys.

It just doesn't add up

300 stations
$5000 / 73" projection TV (price based on a 70" Wega projection TV on pricegrabber.com)
$1800 / Alienware Aurora PC (middle of the road configuration from their web page)

300 * (5000 + 1800) = $2,040,000. Now even if they managed to get a huge bulk rate discount for those setups it would still be horrendously expensive. Let's be gracious and give them a 50% discount, though. So, about a cool $1M to equip the place. $1,000,000 / $5 per hour = 200,000 hrs. Divide that by 300 and you get approximately 667 hrs / machine to pay off the hardware. Figuring there's about 180 business hrs in a month (5hr per weekday and 10hrs per weekend for 30 days) means that every single one of those stations has to run continuously for about 15 weeks to pay off the hardware.

Now factor in broadband for 300 stations, rent, insurance, wages, benefits, advertising, security, etc... those things can easily rack up another $1m annually. So now all 300 machines need to run continually for 30 weeks, or 7.5 months, to cover the cost of the business.

Now the never ending sink-hole that is new game acquisitions. $50/title * 300 means it will cost them close to $15,000.00 for every game they have installed. Lets say the publishers give them a break of $35 / box. that's still $10,5000 / title. What's an average loadout for a LAN box? Four titles? Five? Let's say five. That's $52,500 for the software Figure new titles come out quarterly, but not new ones. Maybe 10 new titles a year? So, $105,000. In machine hours that's another 70 per machine, or another two business weeks. That brings the / machine total to roughly 32 weeks.

8 months of 35 hr weeks, for every machine in the place is a huge huge number.

100% utilization of that facility for 2/3rds of the year is extremely agressive.

So what, right? If they manage it then they have the cost of the hardware covered and the rest is pure sweet profit. Nope. After a year a ton of revolving costs will come in to play:

* Those projectors don't last forever. The bulbs aren't exactly cheap, either.
* Some of that hardware is going to break beyond repair and have to be replaced entirely.
* People expect a LAN center to offer them the current bleeding edge hardware...something better than what they have at home. Machines will have to be upgraded/replaced at a very fast clip.

None of this even takes in to account the R&D and manufacturing costs for those spheres.

Re:It just doesn't add up

Um you assume it runs 8 hours a day? You obviously haven't been to a lan place people constantly cut class and sleep to attend. Also there is lots of money to be made through selling drinks games and hardware.

I think you'll find that it is easily possible, also they have some of the most lucrative deals in the marketplace, $1200 U.S. buys a hell of a system (even retail) Alienware's increadible markup's won't really apply to a company that isn't stupid enough to pay them, an arrangement will be reached. Also top of the line hardware can run for about 4-5 years before needing updates, basically the stuff just needs to run CS:S and Blizzard games.

Re:It just doesn't add up

You've obviously not thought very hard about these problems. These folks are in about the same boat as conventional arcades. Here we go:

Arcade games are expensive. According to Froogle [google.com], they seem to cost between $5,000 and $20,000, each.

Let's pick a nice middle-of-the-road number, and figure $8,000 each for a machine which takes up a lot of floor space, is a maintenance nightmare, and only plays one modern game.

Meanwhile, your retail prices for an Alienware box and the unlikely Sony projector cost a total of $6,800. Add $300 for six (or so) retail-priced software packages, for $7,100 total hardware cost.

This $7,100 gaming machine can play six different titles, has an enormous screen, can play any existing software title for an extra ~$50, and is easily maintained by minimum-wage flunkies. It is conveniently also $900 cheaper than an arcade machine that does none of these things.

The recurring business expenses are probably very similar. Insurance is similar. Wages, per machine, will be similar. They'll be using cheap warehouse space, while arcades typically consume expensive mall realestate - almost certainly saving money, per machine. Advertising is the same. So on, so forth.

It's the same bag - it's just sold at $5 hourly increments, instead of 25-cent game continues.

As for the software expense, it's just absolutely fucking cheap. $10-20k every few months for 300 brand-new huge-screened arcade games to draw in customers with? Sign me up.

The sheep that are Ebay will be more than happy to consume the year-old Alienware boxes for way more than they're worth, making upgrades and fresh hardware relatively inexpensive.

It's hard work, for sure. It's risky and probably slim-margin - arcades seem to be a very failure-prone industry. Nobody said it was easy to run a successful gaming business.

But it's not impossible. This has all been done before.

As a game center owner, I doubt this will work.

I own a game center, TheQwerty.com. Whenever I see a high end game center go up (alien ware computers, VIP rooms, fancy expensive tech..) they usually go out of business in a few months to a year. These people don't realize that this isn't a technology business, it's a *social* business. Most people don't goto game centers because of the technology, they go because they can hang out with friends and play games with like minded people.

These are also low profit businesses, so buying big expensive items will only hurt things more.