#1217 – Entertainment Round Up

As we play catchup on the news that has taken place while we have been on the road, we start this coverage with the events that took place as we move into the later part of 2024 – and leading the charge is the European consumer videogame blowout.

AI Constructed Brief

The 2024 Gamescom and GTI-China events highlighted significant shifts in the gaming and amusement technology landscape, with key observations for investors: Virtual Reality (VR) technologies are experiencing market restructuring, marked by reduced exhibitor presence and cautious industry investment. Sony‘s PlayStation VR 2 platform faces challenges, including price increases and speculation about potential hiatus, while Chinese manufacturers are pivoting towards motion-based VR experiences with a focus on passive ride attractions. The events revealed a cooling consumer enthusiasm for VR. The market appears to be at a critical juncture, with 2025 potentially being a defining year for determining the commercial viability of consumer VR and interactive entertainment technologies.

The cinema industry is undergoing a significant transformation with the rise of “Cinetainment”, a trend that combines traditional movie-going with entertainment and amusement elements. Eight major theater chains, including AMC, Regal, and Cinemark, plan to invest over $2.2 billion to upgrade more than 21,000 screens in the next three years. This shift is driven by declining attendance and the need to enhance the overall film-going experience. The trend is exemplified by acquisitions like The Light chain of cinemas, which will receive a £15 million investment to expand its unique entertainment model, incorporating bowling, mini-golf, and other activities. Simultaneously, the active entertainment sector is growing, with trampoline parks and adventure venues incorporating gamification and technology to create immersive experiences. These developments present potential opportunities for investors in both traditional cinema chains adapting to new market demands, and emerging active entertainment concepts.

Full Stinger Report

Calm Before the Entertainment Storm (Part 1)

Gamescom 2024 – The de facto consumer videogame conference, having taken the crown from the abandoned US E3 event, took place in Germany during August. The key exhibitors, with a reflection across the big IP and pivotal game brands, included Blizzard Games, promoting their ‘World of Warcraft: The War’, part of the 20th anniversary from the IP. The operation’s marketing company turned to creating a VR-based attraction to promote this effort. ‘Escape From Dalaran’ was a booth experience running at 4K in 120fps and was reminiscent of Disney Alladin VR experience prototypes in 1994. Guests to the booth sat on a motion platform, wearing a VR headset.

This attraction proved very popular with guests and media – an example of the consumer games scene turning to wearing the clothes of the LBE attraction scene. Another example was back in 2016, when Ubisoft created a demonstration for their booth that would go on to become the successful ‘Virtual Rabbids’ platform. In the promotion of the Blizzard experience, the company spoke of the originality of the attraction created, but for those in the commercial entertainment sector, it was impossible not to draw comparisons in its dragon riding theme to the current Adrenaline Amusement release.

The consumer games scene’s love affair with some technologies seems to be cooling, as the international market undergoes major restructuring, seeing considerable layoffs and cancellations of projects. While there was a VR presence from a selection of exhibitors, it was far less than seen in previous years. The big development was RotoVR showing their ‘Explorer’ rotational and haptics motion seat. The system was. demonstrated at the show with the VR experience ‘Dig VR’, developed by Just Add Water development studio. The VR seat system has now been developed through a partnership with a Chinese manufacturer and is receiving strong plaudits from media and influencers alike, thanks to its ability to negate VR sickness and create a compelling VR immersive experience. RotoVR went on to announce the raising £2.4m in funding to build on the market rollout for this unique peripheral.

There was no Sony in attendance during Gamescon – the corporation would be seen later in the year at the Tokyo Game Show, but the European event did not have a presence. That said, Sony wanted to be seen to still be supporting their PlayStation VR 2 platform, in the face of rumors from well-placed media that the corporation was unhappy with the slow rollout of their VR hardware. The company attempted to counter these accusations with eight new VR releases – along with the move to offer a PC adaptor, debunking claims that the PSVR2 would not be able to be used with PC gaming. The release of this adaptor saw a considerable uptake in sales. As if to catch this upsurge of interest, Sony rose the price of the PS5 by $100, and this had an impact on PSVR2 sales – increasing the migration to PC usage.

The price hike was rumored to be linked to inflation impacts, but most feel this is linked the arrival of a new updated Pro version of the console. After GameCom’24, the new Sony Playstation 5 Pro platform was finally announced and revealed that the greater performance would offer an upscaling of PSVR2 games automatically – this did not quell the consumer complaints about the higher price platform update. Meanwhile, rumors also swirled that Sony was working on a wireless version of the Playstation VR 2 – the reality is that the PC adaptor and swirling pricing was a means to clear warehouse backlogs. And, for the time being, Sony’s experiment with VR was about to go on a hiatus.

The most noticeable presence of VR at Gamescom was found in “The Home of XR” pavilion, with 19 exhibitors including the likes of nDreams and Combat Waffle exhibiting their VR content – with a migration towards using the term XR, indicating the changing conditions for consumer VR. This was more a gathering of developers wanting to be seen to continue to support the emerging VR market, even in the face of questions if the market was achieving any of the milestones promised. That said, 2025 seems to be shaping ahead as a make-or-break year for defining the VR consumer games market as a vital and profitable business opportunity. This in the face of AAA studios closing development of unique VR projects.

The importance of the videogame sector was reflected in the attendance of 330,000 attendees to GamesCom this year (32,000 being industry professionals), attracted to the 1,400 exhibitors. In the face of the Videogame Jobs Apocalypse this is a very telling state of play for the industry. While stile popular and generating record sales across many categories, the reality of bloated development staffing and budgets, along with compromised media sources, have started to be felt.

Reporting on other gathering and next, the interest of videogames marketing swung to the Tokyo Game Show 2024 (TGS) – taking place around the same time as the European attraction’s madhouse. Then, in November, the holding of the second Amusement Expo Japan – including an amusement music festival. We will go into more detail on developments from this event in the coming extensive IAAPA 2024 coverage.

In the last of the two GTI shows of the year, the 16th GTI Guangzhou Asia China Expo for 2024 (GTI-China-24), took place a few weeks before the major European blowout that was IAAPA-EMA. The event attracted nearly 100 exhibitors to the show venue.

The Chinese amusement and attraction scene was laid out for all attendance and gave a strong indication of the trends on display that would be impacting the 2025 market. These seemed to reflect around colourful and bright prize crane machines, aiming at a younger audience with a more active entertainment element. Active entertainment was represented with “Sportainment” systems such as shooting and archery attractions, and even a boxing simulator (‘Boxing World’). Active entertainment with interactive projection floor and wall systems were also being rolled out from exhibitors such as JAMMA Amusement Technology.

The Chinese VR scene has been in transition, as has much of the VR LBE scene globally. Chinese hardware manufacturers have navigated from the older generations, through hardware, to the updated VR tech. Several developments were kept off the show floor but presented in private screenings, as Chinese manufacturers were retained by Western manufacturers and distributors to develop unique VR platforms to release into the international market. On the actual GTI-China-24 show floor, exhibitor VR Star Space showed new products such as a motorbike-themed, two-rider, VR motions system with fx (‘Star VR Ride’), along with three-seater ride-on motion experiences. These are passive ride experiences, rather than offering interactive narrative, supported by an energetic motion – a lot depends on the quality of the VR ride film experience. One exhibitor, Hero VR, showed a new VR experience with the riders suspended in a rising and lowering motion seat – called ‘Bungee Adventure’.

FuninVR took a large space showing unique ride-on VR experiences, as well as a more convention 4D theater attraction, minus the headsets. Meanwhile, Infinity VR Arcade also had a series of motion ride heavy products on display – more aimed at home audiences – such as their ‘Space Elevator’ and ‘Phantom Knight’ ride experiences. Manufacturer Owatch also exhibited at GTI-China-24, and new VR releases on the booth included ‘VR Beat Star’, a two-player ride motion game system using tracked hands; along with ‘VR Egg 360’, and their ‘VR Flying Theater’. The energetic motion-base (usually 360-degree rotation) is linked to a passive VR experience, seemingly prevalent from many Chinese manufacturers all seeming to crib from the same sheet. The concern being that the novelty of a motion platform is married to the novelty of a VR headset – rather than a compelling attraction.

Celebrating their 30th anniversary, UNIS Technology showed the sequel to their VR ‘Sailor Quest’ two-rider amusement VR shooter. We will have a greater chance to evaluate this as it is due to the deployed on the booth at the coming IAAPA trade events. GTI-China had exhibitor Yuto Games – with a varied selection of amusement and prize machines, along with VR-based platforms including a headset-mounted gun game called ‘Operation Firestorm’. All of the VR systems on show used the ubiquitous DPVR series of VR headsets, which seem to have become de facto standard for the Chinese market.

It was clear that the perfusion of VR products was down, and the number of VR manufacturers exhibiting was also far down on previous years. The novelty has worn off the Chinese VR scene and the reality of revenue generation has kicked in. Many VR arcades are being replaced with crane arcades in the territory. Separate of the VR, and XR was represented, with at least one exhibitor showing eKarts running with AR glasses system for an immersive experience.

China has not embraced the VR free-roam arena scene as a standalone amusement product as in the West. While Chinese funded companies such as Sandbox VR push their LBE strategy, GTI’24 had very little example of standalone VR arenas on display, with a strong attendance from Western sales representatives from the key distributors and operators. The importance of the Chinese development operation centralized around this was evident on the GTi’24 show floor, with exhibitors such as HY Technology showing their video racing game that had been licensed and distributed by SEGA Amusement International in the West. The majority of video and redemption manufacture is now localized in this territory. Other amusement of note included Raisefun Entertainment showing their new release ‘Boxing Stars’, a boxing game machine with a screen and game content in the mould of the TAITO classic.

In Conclusion – there were strong impressions from the show this year that marked a turning point for the Chinese amusement trade, able to fulfil the needs of the international market and come to the table with unique amusement product releases. The explosion in new facility opening has created a strong demand for reliable and cost-effective hardware, and the Chinese market was active to grab this opportunity.

The Threat of Counterfeiting and IP Theft
One story that came out from IGT was the continuation of information seen emanating from a growing conflict between Chinese and Western amusement manufacturers. As the Chinese market reels from changing conditions, several amusement manufacturers have returned to the discredited practise of copying and counterfeiting. Operators walking the IGT’24 booth were surprised at several products on display that were clearly copies of already-released titles. At the same time, visiting several local amusement sites in the territory during the show, Western visitors came across amusement pieces in venues that were blatant rip-offs of Western games. Their existence is hidden behind the “Bambo Curtain” to avoid censure. Some copy machines even had the names of Western manufacturers on screen, faked to add “authenticity”.

This is seen as a serious situation. The inability of any of the trade associations to effectively police the copies being fabricated in China throws into question the vast amounts invested in IP policing. The ability for companies in China to pump out these copies, as well as being accepted into the Western market through other manufacturing, has caused consternation around the point of supporting associations tasked with protecting members interests. The situation has even seen Chinese agents representing these knockoff machines attempting to defend their actions, as justified in promoting Western products to Chinese audiences – seemingly oblivious to the illegalities of this action.

Calm Before the Entertainment Storm (Part 2)

Continuing the game of catchup, looking at the prominent trade events and market trends impacting the amusement and attraction scene before the end of the year. And we turn to the trend of “Cinetainment” – the inclusion of entertainment and amusement in the cinema sector is gaining greater recognition, and this was boosted by a far reaching feature in Variety, reporting on information from the National Association of Theater Owners (NATO) that eight key theater chains would be investing more than $2.2b to modernize and upgrade more than 21,000 screens over the next three years.

The eight theater operators include AMC Entertainment Inc., Regal Cinemas, Cinemark USA, Inc., Cineplex (with their ‘REC Room’ and ‘Playdium’ amusement venues), Marcus Theatres Corp., B&B Theatres, (with their ‘B-Roll Bowling’ and ‘Outtakes Arcade’), Harkins Theatres, (with their ‘PlayCenter’ chains) and, finally,  Santikos Entertainment. The report followed on with developments that had been charted at CinemaCon in March’24, that the deployment of an entertainment element was essential to the survival of these spaces – along with a reinvestment in the whole film-going experience in the face of dropping attendance and dissatisfaction.

Cinetainment developments were also reflected in the news that The Light chain of cinemas had been acquired by hospitality entrepreneur Luke Johnson and Risk Capital Partners, along with a co-investment from Melcorpo – investing more than £15m over the next two years, with the aim of doubling its size. The Light currently operates 13 cinema and leisure venues in Addlestone, Banbury, Bolton, Bradford, Cambridge, New Brighton, Redhill, Sheffield, Sittingbourne, Stockport, Thetford, Walsall and Wisbech.

The Light has developed a unique entertainment model which includes bowling, mini golf, interactive darts, climbing and karaoke, in addition to its core cinema offering.

Moving on to the other developments and, at the same time, the 12th annual International Adventure & Trampoline Park Conference and Tradeshow (IATP 2024) took place in Hollywood, Florida – run by the association for its members and for service providers to gather. The “Sportstainment” and “Active Entertainment” scene is under the spotlight and carrying on from what was seen at the China show, and the need to offer the customer the right mix was ever more important.

Active Entertainment is a trend that has gained momentum away from the previous fitness focus, now with the inclusion of gamification at the forefront. At the show, of some 60 exhibitor, Valo Motion attended the event promoting their range that includes the ‘Valo Jump’ interactive trampoline MR attraction. Others included CSE Entertainment, a company that has defined “Exergaming” – offering a blended exercise and game experience.

The game floor concept was evident at the show, with Battle Company representing the ‘Flash Pads’ multiplayer interactive illuminated floor platform. These systems, from multiple companies, are finding strong interest in deployment as an attraction in Active Entertainment venues. The company was also promoting their ‘EDGE’ platform that brings game modes and scoring to facilities.

Adding Gamification to the Active Entertainment scene was also illustrated from exhibitor Rugged Interactive – offering a game and scoring platform that can be incorporated into any park. Amusement was represented by the likes of Betson Enterprises and Sureshot Redemption, with many trampoline parks turning to the addition of a midway amusement zone component to offer a secondary spend for their facility.

SHOCK – along with their trampoline park technology the company was also promoting their ‘Jump Ringz’ time management platform. Meanwhile, IATP expo sponsor Sacoa Cashless System, the ePayment platform provider, created a revenue management solution for operators; and specialised credit card processing for adventure and trampoline parks was presented by FEC FIN.

In Conclusion – Active Entertainment has grown as a new trend that is being applied across the territories. It attracts younger audiences, as seen by the inclusion of ‘Trampoline Zone’ in the new design of ‘Chuck E. Cheese’ venues – as reported in their new Canadian redesign – and is being developed for standalone venues beyond trampoline style sites.

Active Play

It was announced that Dubai would be seeing the opening of the first ‘Activate’ venue at the City Center Mirdif. This venue is developed by Activate Games, a company developing platforms that fuse gaming with fitness, with numerous facilities already open in the US and Canda with some 32 sites. Just before going to the wire, it was announced that Activate would be seeing its first appearance in the UK. It was revealed that the developers behind ‘Flip Out’, ‘Putt Putt Social’ and founded ‘Boom Battle Bar’, We Do Play, have signed an agreement towards rolling out the active entertainment social experience in the country. In the announcement, media reported that ‘Activate’ would be opening its first UK site at The O2 entertainment district and outlet store hub, with a 10,000-sq.ft. facility. This area is already familiar with the social entertainment mix, having seen the launch site of TOCA Social and the updated Hollywood Bowl franchise. We Do Play has ambitious plans for the Activate franchise in the UK, looking at 30 venues by 2026.

What in the past The Stinger Report has championed as “Exergaming” seems to be becoming roped into the Active Entertainment revolution. IATP’24 offered not just new opportunities for trampoline operators, but also had an eye towards active entertainment, which was defined as “Adventure” in the association’s positioning. “Active”, “Sportstainment” and “Exergaming” are all aspects of this part of the industry. Offering a fitness offering scoops up the abandoned gym and fitness industry, still decimated after COVID, and offers a young audience appeal – which can also look towards school and colleges business, with physical education back on the agenda for many educational groups. We have reported this emergence in Japan with the new ‘JOYPOLIS Sports’, and ‘VS PARK’. IATP’25 is scheduled for around the same time slot next year, in Arizona.