Beyond the Traditional
Digital Out-of-Home Entertainment Takes Its Place

April 5, 2012 No Comments

A new form of public-space entertainment that builds on the foundation started by video amusement some 40 years ago has taken hold. As we all take a close look at our respective entertainment facilities business, we awaken to the reality that we work in a sector undergoing transition. While some benefit from the “stay-cation” bounce in attendance and spend at regional venues, others suffer a major down-turn in business – a divide has appeared between the two sides of the “amusement” component of the pay-to-play sector.
What has become known as the “traditional” amusement scene has come to represent an established and somewhat staid business mode. A throwback in many cases to the established business practices from the mechanical gaming scene (first established in the 1930s), coin-operated amusement, and the controversial growth of “small stakes” and “prize amusement” machines.
Fitting into the traditional mix, the video amusement sector has been nurtured in the pay-to-play sector. For the video (digital) amusement scene, it has seen a number of major milestones marked recently, such as with the 40th anniversary of the first coin-op video game, with Nutting Associates’ 1971 “Computer Space.” Over those 40 years, the video sector has evolved into a popular and diverse market that has outgrown its original amusement trade confines.


With the collapse of the traditional arcade facility business, video amusement has had to fight to find a new home. With the loss of the perception of a single site that would offer a home for addicted youth to play the glowing boxes of the video games in the 1980s, the conventional industry and manufacturers have started to part ways. The more that the modern amusement pieces have become a secondary revenue generator to a larger facility’s mixed entertainment menu, the harder it has become for the traditional owner/operators to understand how to work with this new opportunity.
The problem for the modern manufacturer is that they have depended on feedback from the operator environment toward shaping the hardware they develop. The implosion of the traditional “manufacturer-distributor-operator-owner” model over the last few years has removed valuable communication between the player and the developer. In recent years, rumors have spread concerning the manipulation of essential new machine location test reporting. It has been said that those selling the machines have shaped the reports to the developers so they reflect more what they are prepared to sell than what the audience wants to play. Uncertainty now permeates some of the structure of the traditional amusement scene, with intransigence towards new ideas and sales opportunities.
With this restructuring of the sales mechanism, we have also seen the appearance of unorthodox manufacturers entering the scene. These companies do not come from the stereotypical environment, but have rather emerged from a digital design and development background that includes companies that have worked in the consumer game sector. They bring a new way of doing business unhindered by the baggage of previous factory mentalities. However, these new companies, in dealing with the traditional trade, have abutted against restrictive practices.


What has evolved from the conventional amusement scene is a new methodology for the digital (video) amusement component. As the new generation of technology grows and expands, it has outstripped the limitations of the traditional coin-operated amusement scene and its way of doing business. In order to grow, this emerging sector has borrowed heavily from other successful industries, (outside of coin-op), following a similar successful path of growth.
These moves have seen the new industry redefine itself. Gone is the video amusement mentality – enter the Digital Out-of-Home Entertainment (DOE) industry!
DOE borrows the “out-of-home” nomenclature from the hugely successful digital signage industry that established the out-of-home approach as a defense against the erosion that impacted their business for the consumer scene. Likewise, DOE has to fight for recognition against all the calls on the interactive digital entertainment that populates the customers’ home, ranging from console gaming, the internet and now smart-phones. The public-space digital entertainment sector has had to adapt to survive.
The driving force in attempting to shrug off the traditional amusement perception that has floundered against the erosion of home gaming has fundamentally been the deployment of the modern pay-to-play piece into a raft of new and compelling venues. These venues are far beyond the traditional family-entertainment center and amusement hall, moving to an impulse play model to attract the new audience.
The DOE scene has been recognized as comprising four core elements. The first comprises elements of the traditional amusement scene (“Digital Amusement and Pay-to-Play”) working to break free of tired thinking and intransigence to change, as we will state later, the growth in a sophisticated customer base. This growth has forced the amusement business to recognize the need for change, though the stubbiness to let go of bankrupt business practices has hindered this need for redevelopment.
Another element of the new market for DOE is “Digital Interactive Attractions,” at home originally in the largest theme parks and resorts. Advances in technology and cost-effective development now bring the experience of a revenue-generating interactive attraction to a wide variety of attraction locations. These audience-based experiences are a compelling “repeat visitation” experience and have married the latest deluxe amusement system with scaled-down theme park attractions.
An eye-catching centerpiece attraction, with repeat visitation value, and a means to generate a stand-alone revenue stream, has been the aspect of the new DOE systems that appeal to the next element of the new market. “Retail-tainment and Hospitality” covers a wide selection of the service and retail industry; venues that need to shape their approach to attract and retain customers to their venues. If these goals can be achieved through an “entertainment anchor,” such as a DOE system, then one the better.
The final element of the new venue landscape for developers of DOE machines is the “Education and Leisure” sector. The ability to place interactive attractions that offer an educational element has grown in popularity in science centers and museums. This international “edutainment” scene is a valuable weapon in the education arsenal. One example is the ability to use interactive digital entertainment and network competition to compel the exercise and fitness experience, which has proven a valuable methodology to treating obesity and a sedentary lifestyle.
For these various sectors, this is not the first involvement with the pay-to-play sector. But previous involvement with the traditional amusement sector may have left a bad taste in their mouths. In particular, the merchant sector has dipped a toe in the water of incorporating amusement into their retail venue mix only to butt-up-against the intransigence and protective practices of the amusement operator scene. This sector may have abandoned major involvement after being bloodied and bruised.


A factor in shaping the second look that pay-to-play entertainment is receiving from these sectors is the change in the customer that these various venues are hoping to attract.
The level of sophistication and engagement required from Generation Y (also nicknamed “the Millennials”) far surpasses the traditional means to attract and hold an audience to a location. Interactivity and social engagement is key, and the presentation of a passive experience is becoming a less appealing aspect of the entertainment spend. For the traditional amusement sector, this level of engagement with the people that pay their wages has proven an anathema.
Engagement with these Millennials places demands on the DOE system that cannot be achieved currently with traditional video amusement. Fundamentally the delay in embracing connectivity between machines in the North American market means that the benefits of inclusion with the players are lost. Connectivity offers online player tournaments and ratings through smart-card storage. And with smart-card and Near Field Communication (NFC) (using smart-phones) the means to pay for the gaming experience can be modernized to appropriately fit the experience offered.
Bringing a closer link to the players and the machines they play, and the ability to offer social networking elements, can personalize the experience. Players can share with their friends and promote the game and facility and encourage repeat visitation. This engagement will see a realization that the traditional coin-operated perception of video amusement has undervalues the modern amusement experience. A need to embrace virtual voucher schemes, digital loyalty rewards and social networking promotion concepts alien to the original amusement scene.


In charting the move towards the DOE sector, it has been seen that the current amusement and attraction trade association structure is unable to support the unique needs of this emerging market. Attempts to offer support have proven difficult, a difference in business practices and an inability to understand the new language of the pay-to-play scene. Another factor is the limitations on the resources of the traditional amusement trade, fighting a hard battle of their own to defend their position and business viability.
To assist the emerging new sector, an international conference has been established. Celebrating its second gathering, the Digital Out-of-Home Interactive Entertainment Network Association (DNA), has followed the success of the London event in 2011 with a move to California. The Los Angeles conference is scheduled for May 2012. Leading developers and operators from the various sectors of the DOE have been invited to present an overview of the issues that are shaping this new market, and the need to move forward.
With the DNA United States Conference, a move is also underway to create a means to regularly share information between those entering the market, developing to support it, or operating machines at the sharp end of a diverse and evolving scene. A new news service and the launch of the DNA Association will act as a trade rallying point to promote and inform the development of DOE internationally.
The conventional amusement and attraction trade will continue to evolve and grow. At the same time, a new, breakaway DOE sector offers a glimpse of the issues that will shape all established industries. These industries have the ability to grow and redefine themselves as the audience grows and evolves in the digital age. –

(Contributor Kevin Williams of the United Kingdom is the owner of the KWP consultancy and The Stringer Report. Williams is also the founder of the non-profit DNA Association and DNA Conference. Reach him at or


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