#1103 – The New Year Dividend for Entertainment

The New Year sees an incredible movement of interest and investment into the Out-of-Home Entertainment landscape, although some of these developments have taken some time to consolidate.

The previous attempts in the 1990s, to define a new era of amusement and entertainment space for a more diverse audience, took on a new relevance as the ghosts of those attempts raised their heads again, both in the final consolidation of one, and the re-emergence of concepts from another. The Location-Based Entertainment (LBE) market and the emergence of Social Entertainment are about to see a new phase of activity, and we hope the lessons from the last failed attempts have been learned. 

Collapse Of Hollywood Arcade Chain

Speculation had been high that the true manifestation of the impact of the Global Health Crisis and lockdown on the entertainment scene had not yet been witnessed. However, eventually, the indications have started to manifest, seen with the first business closure under the current conditions. 

Sources confirmed, at the end of December, that news had been circulating of the closure of the famous amusement and food chain, Gameworks. Comprising some seven remaining facilities across North America, the operation succumbed to problems with its past management decisions, and the financial impacts of the loss of business during the enforced lockdown and furloughing of business. In a later statement on the operation’s website at the end of the month (when the inevitable could not be avoided), it was affirmed “…the continued slow economic recovery has left us no choice other than to close.”   

The Gameworks entertainment facility chain has gone through an incredibly turbulent period, as one of the remaining properties of the original LBE explosion. In 1996, the concept had originally been branded SEGA Gameworks, a partnership between Dreamworks SKG, MCA/Universal Studios and SEGA Enterprise, with additional partners Microsoft, and other high-profile names. This resulted in a confused and eclectic design process and a resulting venue operation that was highly criticized. Soon after opening the first facility in Seattle, and a famous Las Vegas flagship, the concept started to unravel. All the partners would eventually depart, and the SEGA involvement would be terminated. The operation would acquire the failed Jillian’s bowling entertainment brand, only to then fall into administration – having operated, at its height, some 30-sites. A complicated management buyout would take place, then a complicated round of owner handovers, with 2010 seeing the relaunch of the operation first controlled by Oomba (the much-hyped social network start-up), but then, in 2018, the ownership reverted to ExWorks Capital.

The closures were first leaked by social media feeds of staff for the entertainment chain, revealing their termination during December 2021. Then other feeds tried to placate the growing speculation – saying the Seattle site was to be closed for a “deep clean”, promising to reopen. However, eventually, an official Twitter post was run by a senior executive of the operation, confirming their closure was more permanent. This impacted all seven remaining stores of the operation, shuttering their doors at a time when some had expected strong visitation. All but for the Las Vegas facility which remained open and was rumored to be in discussions to be separated from the overall closure of the Gameworks chain. 

Gameworks had pivoted from the US interpretation of the SEGA JOYPOLIS concept (as envisaged by the original formation), to the eSport gaming experience, supported by amusement and F&B. The pivot proved a difficult manoeuvre, although sources had suggested that the Las Vegas venue (returning after the closure of the first site), had seen strong attendance. The chain operation received notoriety, appearing in the post-apocalyptic console game ‘The Last of Us: Part II’. The operation has had close association with the trending of the emergence of gaming. And fittingly, one of the last Tweets from the operation stated they were, “assisting the Video Game History Foundation in preserving what we can of the place.”

Hitting just as the holidays started, details of the collapse of the operation and the fate of the remaining facilities were thin on the ground. Sources had been quick to lay the failures of the operation at the feet of their current owners, compounded by the impact of loss of business during the lockdown, but it was clear this had been a struggling operation, even while projecting an outward image of continuation. Only recently, in December, Gameworks had announced a partnership with display maker Brelyon, towards offering their no-headset VR display at their PC eSports game lounges. 

That this game chain would collapse in such an ignominious way underpinned the confused condition of the operation – just as LBE facility opening reached an accelerated state. Newcomers to the market are not burdened with previous debt and have avoided some of the recurring management mistakes, whilst others have failed to learn from the opportunity that this growing market represents. We will report on further details as they emerge, although we wish all those impacted the best in their next positions. A more detailed review on the history of GameWorks was created for our friends at Arcade Heroes.

Return of DisneyQuest Concepts?

Meanwhile, DreamWorks created GameWorks LLC to partner with SEGA Enterprises, and so take away the opportunity from Walt Disney who had started the discussions. Disney would go on to create its own answer to the 1990s power-play towards establishing Location-Based Entertainment (LBE) – with the famous ‘DisneyQuest’ franchise facility.

Eventually, DisneyQuest would fail to live up to expectations, and the $90m investment would only see two facilities open in Orlando and Chicago – the latter only surviving a matter of months, while the Disney Springs site would go on to live for nearly 20-years, becoming a fan favourite, if not a tempestuous operation to run. We have already reported, last year, on the collapse of the plans to replace DisneyQuest with an ‘NBA Experience’ concept that did not even manage a full year of operation before being shuttered.

But the spectre of DisneyQuest is about to reappear, with the opening this year of a new concept from the House of Mouse. Called ‘PLAY!’, the pavilion is a brand-new attraction within the World of Discovery in EPCOT Walt Disney World Resort. This coincides with the Walt Disney World’s 50th anniversary celebrations, after its postponed opening for 2021. The ‘PLAY!’ pavilion is a culmination of various Disney/Pixar properties, with a space dedicated to video gaming and interactive fun, comprising several areas. Several interactive attractions will comprise the space, with suggestions of a virtual water-balloon throwing interactive projection wall experience, and an interactive game called ‘Hotel Heist’.

All this, along with a selection of video amusement pieces – the first time in recent history that Disney has seriously deployed amusement hardware since the last days of its flirtation with ‘ESPN Zone’. The space will also see Selfie Stations where players can stream action on their favourite MMOG, such as ‘Fortnite’ and ‘Counter Strike’. It even includes a popular character ‘Meet-and-Greet’ area – alongside a toddler play area. 

Another aspect will be the inclusion of ‘Animation Academy’ – this concept can trace its origination back to 1998 and its first installation in DisneyQuest. The concept of digital animation drawing stations, connected to a central “animator” teaching the skills, has gone on to be a firm favourite with installations at Disney’s Hollywood Adventures, Hong Kong Disneyland, and other locations. An updated version of this attraction, using characters from ‘The Incredibles’, will now be dusted off and deployed within PLAY! We look forward towards seeing if this concept is a single entertainment offering, or could be the start of a return to considering a LBE chain concept.

The embarrassing failure of the ‘NBA Experience’, followed by GameWorks, has hammered home the need for a professional and experienced approach to the deployment of interactive experiences towards a diverse audience. While many will be quick to spin a ‘Global Health Crisis’ narrative based on the news, the reality is that the situation has been much more nuanced regarding preconceptions of what the amusement and game mix could offer the modern (sophisticated) gaming audience. This also reflected a possible deficit in experiences towards the experiential needs of the modern market from the teams assembled. 

Mergers, Acquisitions and Layoffs

Continuing the impact of the post-lockdown landscape, and other results of the changing sector were reflected in changes seen. One example is with operator Palace Entertainment, a subsidiary of Parques Reunidos, and the leading global leisure attraction operator, with more than 60 different assets including theme parks, zoos, marine parks, water parks. The company announced its acquisition of Adventureland Resort in Altoona, Iowa. Adventureland is an operation that has been a family-run business since opening its doors in 1974. The venue has more than 100 rides, shows, and attractions for all ages, from mild to wet-and-wild, and features shows throughout the park for a variety of family fun and entertainment. Currently, no information on the acquisition price was available.

The impact was obvious pre-lockdown in the cinema sector and, post-lockdown, it has taken to the start of the 2022 for the ripples to gather pace. The first was the news of the competition, acquisition, and mergers, with the acquisition of 100-percent of the stock in Showbiz Cinema by the EVO Entertainment operation. EVO had delayed its expansion plans of its (large format) 68,000-sq.ft. mixed-entertainment location in Dallas for the New Year and will now control the combined operation. EVO Entertainment Group started in 2015, representing the EVO Cinema, EVO Entertainment and EVO Concerts, all of which will be combined with Showbiz’s nine entertainment locations, redefining the styled “Cinema Entertainment Center” (CEC) chains.

Following this acquisition, and further news hit that prominent entertainment properties were all being thrown up for purchase. This included the prominent ‘M&M’s World’ store on Broadway, in Manhattan. This iconic location was acquired for the reported sum of $190m by real-estate investment firm, Paramount Group. The three-level, 25,000-sq.ft. retail entertainment space was first opened in 2006, and had been owned by Sherwood Equities. This development is expected to be followed by other prominent locations throwing themselves over to the recovery (and available investment) for location-based entertainment – and a new redevelopment of LBE style deployment to make light of the changing economic conditions for “Retail-tainment”. The ‘M&M’s World’ chain of stores includes sites in Berlin, London, Las Vegas and now the sold New York venues. They offer a brand promotion space, comprising specialised merchandising, as well as retail-tainment elements. 

But sadly, the rebounding cinema industry also saw the impact of staffing issues. It was announced that Canadian theatre chain Cineplex had taken the decision to temporarily layoff some 6,000 part-time employees at roughly 67 venues across Ontario and Quebec. This is an impact of the mandated closure of such premises to address, within the territory, the spread of the Omicron variant of COVID-19 which has seen a surge in cases across the country. As we will be reporting in following coverage, this mandate was also applied to conference and exhibition plans in January, seeing the postponement of many planned events. 


The momentum that cashless has achieved across the amusement trade has gathered pace in the face of the post-COVID conditions. One of those hardest hits, but also most active in the “Bounce-Back”, is seen in the Japanese amusement trade. This was reflected in the announcement, in December 2021, of the formation by the Japan Amusement Industry Association (JAIA) of a “Standardization of Cashless Payment Standards”. This is a protocol that all amusement machines within the territory will comply with, allowing for a single standard across payment terminals and amusement pieces. This will come into effect in Spring 2022 and will be adopted across the JAIA membership. There will be an impact on the already established ePayment systems employed by the likes of SEGA, KONAMI, and TAITO, but this was not clear – although it will represent a full-scale reform of the payment infrastructure for the future of the Japanese factory base.

The ramifications were not slow in manifesting themselves. As seems to be the case, recently GENDA led the charge, able to use its combined might. In announcing the upgrading of the four SEGA stores in Akihabara, the operation also revealed the introduction of the ‘Machi no Coin’ electronic payment system, and the currency ‘Akiko’. Operational from early January 2022, this new cashless payment platform will support smartphone operation – called a “Community Currency Service”. GENDA SEGA Entertainment facilities, since June 2021, has been able to accept other smartphone payment apps (such as Alipay, J-Coin and PayPay), although the Akiko coin is expected to now supersede previous systems. And we seem to turn full circle, as GENDA is the new owner of the PAC-MAN Entertainment flagship facility in Chicago, close to the now-closed GameWorks location! 

About the author

Kevin Williams

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The brainchild of two location-based experience enthusiasts, Christine Buhr and Brandon Willey, the LBX Collective aims to inform and educate, create opportunities to connect with industry peers, and to spur collaboration, discourse, and cross-pollination of ideas.

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