Game Center Chronicles: Half a Century of Arcade Games as Seen by the Owner of Mikado
- ゲーセン戦記 ミカド店長が見たアーケードゲームの半世紀
- Written by Minoru Ikeda
- Released 06/08/2023
- Published by Kadokawa
- Purchase on Amazon.co
This is not meant to be a full translation of this work, but rather a book report style summary. I encourage anyone reading this to buy the book at the link above to support Mikado!
Stage 5: Era of Chaos 2019-2023
From the Best to the Worst
There were two primary reasons for Mikado’s increased profits in 2018: The business actually grew. In addition to the new location in Ikebukuro, Mikado opened up collaboration locations with Amipara in Hiroshima and GAME Hoshigari Monogatari Kishiwada in Osaka. Revenue also came in from new sources. Streaming and collaborations on software development contributed heavily, and Ikeda was asked to setup an arcade in the offices of Delightworks, a subsidiary of Aniplex known for developing the Fate/Grand Order mobile game. Mascot character Mikado-chan was also created in October, and merchandise featuring her sold very well.
Profits from the various arcade locations made up 80% of total revenue, with everything else making up the remaining 20%, for a total of 20,000,000 yen. It may not seem like much, but keep in mind that there are basically no new games in most Mikado locations. Ikeda felt it would probably be impossible for an arcade to make money purely off of retro games in an era where free-to-play smart phone games existed, which is why Mikado leans so heavily into streaming, events, and merchandising. It was an attack on all fronts to keep their small arcade alive.
Just when Ikeda was starting to feel some peace over Mikado’s success, a disaster hit. When he heard the first rumblings of COVID-19 on TV news in December 2019, it seemed like a situation that only existed across the ocean. But then it was confirmed in Japan the following month, and then again the next month…And in February 2020, Mikado’s revenue began to sink.
2018 saw 3000 customers coming into Mikado on a normal weekend, and about 10% of those were tourists from overseas. The tourist number reached zero, and the overall foot traffic went down below half of the normal number. Things got really bad, but there wasn’t anything to be done about it. Even if Ikeda held tournaments every day, no one would show up. The owner of the Mikado buildings in Takadanobaba and Ikebukuro had even recently approached Ikeda about taking over management of the nearby Shiratori Game Plaza. Running yet another arcade under these conditions seemed like such a reckless venture…and yet, it made Ikeda think back to the hard times Mikado experienced during the Tohoku Earthquake. He gave it his all back then, and made things work. It was better to go down fighting than just give up and let the business sink.
The new collaboration location, Game Center Mikado x Natsuge Museum, would re-open the beloved Natsuge Museum in Akihabara, which has closed back in September 2019. And to achieve this, as well as keep Mikado afloat, Ikeda took to crowd funding. In order to further promote the spread of arcade culture of old, Ikeda also thought that Mikado collaborator Gichi Otsuka’s TokyoHead book was in need of a reprint, since it was such an important work in chronicling the ‘90s fighting game scene. The target crowd funding amount for all of this was 20,000,000 yen, though he never imagined he would get it. Tokyo’s first state of emergency (which required many businesses to close early) was declared on April 7th, and Ikeda’s crowd funding campaign went live three days after. It came to an end on May 10th, to resounding success. 3872 people contributed to the campaign, for a total of 37,238,892 yen. Ikeda had never felt so grateful.
But not every arcade was able to do this sort of crowd funding. 2020 saw the total number of arcades in Japan going down to 3931. Compared to 1986’s number of 26,573, 85% of them had closed over a 34 year period. And according to an amusement industry report, the total revenue went down to 526,000,000,000 yen in 2020, from 705,500,000,000 yen the previous year. This number had been gradually decreasing for some time now, but this was an enormous drop in a very short period.
None the less, crowd funding had gotten Mikado through a very difficult year for the industry. Everyone figured that the COVID situation would get under control at any time, and things would return to normal. This proved to be incredibly naïve.
Second Round of Crowd Funding
2021 came, and nothing had changed. In fact, the situation had gotten much more severe than it was before. Despite all of Ikeda’s actions, people just weren’t showing up. Tokyo declared its second state of emergency on January 8th, and Mikado once again hit its financial limits. The money from the first round of crowd funding didn’t quite last the year. Ikeda tried everything he could: Reduction in staffing, rent negotiation, and installment payments on taxes. But the arcade industry just seemed to be collapsing around him. Even ‘90s fighting game hub Game Spot 21 Shinjuku shuttered. While restaurants and bars were getting government aid, the same thing was not extended to arcades. Ikeda even accepted an interview from the Tokyo Shimbun to explain his situation.
So on March 15th, Mikado launched a second crowd funding campaign, this time seeking a total amount of 10,000,000 yen. This not only focused on raising funds to keep the various Mikado locations afloat, but also to cover printing costs for a TokyoHead sequel book, and developing their Mikado-chan mascot into a VTuber. Ikeda wanted to make sure that they were doing this not just to keep Mikado open, but also to continue promoting arcade culture. When the campaign ended, 1206 people had contributed 15,683,833 yen.
There was one thing about crowd funding that Ikeda hadn’t considered, though: It counted as miscellaneous income for tax purposes. The more he got, the more taxes he had to pay on it. So even though the arcades weren’t bringing in revenue, his taxes were higher than they’d ever been before. None the less, Ikeda was extremely grateful for all of the crowd funding support that helped Mikado make it through.
The Worst Crisis for Arcades
Looking back on it, Ikeda doesn’t think that arcades have ever been in a worst spot than they were during the first two years of the COVID-19 pandemic. This is true for both small and large arcades, with Sega abandoning their long running arcade business being the biggest piece of supporting evidence. But Mikado was able to make it through by pure persistence. If COVID was making it harder to draw in customers, then they resolved to pivot to doing business in new ways. They got involved in more software development, and did promotions for retro game products like Sega’s Astro City Mini.
Ikeda even got overseas offers to buy Mikado, which he refused. He’s been in the industry so long at this point that he wants to be around for the day that the final Japanese arcade disappears. In an era with so many social and mobile game options, arcades are a harder and harder sell. But they’ll always have their own unique culture that can’t be fully reproduced anywhere else.
Toward the Future of the Arcade
The JAEPO was held in 2023, for the first time in three years. It revealed that the overall size of the Japanese amusement market had gone down by 25%, meaning that any kind of recovery isn’t going to be easy. But despite how critical online presence was during the pandemic, the industry is choosing to play to its historical strengths and focusing on in-person experiences for the future of the arcade world. And though it’s mostly focused around prize machines, it will be interesting to see where the arcade video game world goes.
The reason that this part of the industry has shrunk so much is that they’re just not getting enough return on investments. This is because costs have become too high and the amount of overall arcades has dropped dramatically. The draw of modern arcade games is being presented as experiences with large and extravagant cabinets, which cost a lot more to manufacture. So unless an arcade is large and brings in a lot of traffic, it can’t afford to bring in machines such as these. The industry trend of moving away from a general purpose arcade board also hasn’t done it any favors. The new connection standard, JVS, is also much more complicated than its predecessor JAMMA. It involves quite a few more adapters and connectors in order to install your average board.
But one of the biggest reasons for the overall industry decline is undoubtedly that most of the major arcade distributors have long since gone bankrupt, due to the imbalance between units sold and cost to produce. Game developers also suffered quite a bit from this, which is why fully networked systems such as ALL.Net P-ras MULTI and NESiCAxLive came about. This took all of the inventory risk out of the equation for everyone involved. It also guaranteed that new titles would be available in arcades on release date, since they’re all streamed to the hardware. But no titles on these platforms have hit it sufficiently big on a national scale, and development costs are still too high. You also can’t set them up in less-game focused locations like dagashiya (smaller candy shops that historically had arcade cabinets in them) or shopping malls, because the machines can’t just be rented. Therefore they aren’t really appealing to younger and budding players. This scheme has pretty much hit its limit, and Ikeda believes there’s nothing left to gain for any of the parties involved. The arcade industry made the same mistakes that Nintendo did with the Famicom Disk System disk writing service, so many years ago.
The Wisdom to Survive
Unfortunately, Ikeda believes that the industry has reached a point of no return. But he does have some ideas that may allow any smaller arcades to continue to survive.
Increase your Value!
Alcohol tastes different when you’re having a good time out with friends than it does when you’re drinking alone at home. So you have to find a way to share the benefits of being with other people in an arcade, and Ikeda has done this through streaming and events.
One of the strengths of the Japanese games industry is that it pays attention to overseas. And the level of enthusiasm many people there have for these games is amazing. But still, the mystery of the Japanese arcade hasn’t completely been conveyed to them. Having multi-language support for things like streams like Mikado has is an untapped one, particularly if it was from other knowledgeable people.
A Pinch Isn’t a Chance, but rather a Big Pinch!
This is true of any job, but at some point you’ll definitely find yourself in a pinch. But contrary to some people’s advice, this isn’t the time to tell yourself something naïve like “This is just a chance presenting itself to me”. Instead, it’s probably an even bigger pinch than you’re thinking it is. All you can do is give it your all and work even harder to get through it. You may make some mistakes along the way, but try everything you can in the process of getting out of it.
Be Picky About Location!
Mikado’s rent is not cheap, and Ikeda is sure that running it would be easier if he relocated somewhere cheaper. But would he really have gotten as much traction if he had? You can pull it off if you have enough charisma as a business, but otherwise, location is very important in order to achieve any sort of momentum. It’s surprising just what a difference it actually makes.
Just Learn More!
When Ikeda worked at previous arcade industry jobs, he advertised in absolutely shameless ways. He even distributed flyers door-to-door. Looking back on it, it was kind of crazy, but there was some power in it. It again goes back to trying everything you can, because if you don’t, you’ll never know what actually works.
Sharpen Your Planning Skills!
His previous job experience gave Ikeda the planning skills he needed to effectively run Mikado. Working at arcades that only had prize machines, and so being unable to run tournaments, he was forced to come up with other ideas to bring in traffic. His go-to was bingo tournaments, but one day he decided to try something different: Distributing flyers that could be redeemed for vegetables for anyone who came into the arcade. He’d spent a bunch of money on vegetables at a 100 yen shop and advertised this to bring in customers who normally wouldn’t set food in an arcade. And sure enough, he was surprised by how many house wives showed up because of these flyers. Mikado has held everything from singing contents, ice cream speed eating contents, rock paper scissors tournaments, to cotton candy tournaments…everything Ikeda could think of. There’s even been wrestling matches there. Ikeda is quite sure he’s not done with the crazy ideas yet, and even mentions that if you bring a copy of this book to Mikado and ask him to sign it…something special will happen! But he embraces this silliness, and recognizes that it’s a part of makes Mikado what it is. You have to be able to laugh at thing sometimes, even in business. His mission statement for Mikado has always been making it a place where people come in, have fun, laugh, and then think “well that was fun”. He wants it to be a place where people can always come back to in order to get away from their troubles.
Mikado has gone through a lot to get to where it is now, and Ikeda has constantly been forced to confront his own inexperience in the face of hardships, and has all manner of painful memories as a result. But for his family, employees, and customers, he’s grit his teeth and moved forward one step at a time. COVID had a major impact on all manner of entertainment related industries and sub-cultures, and he lost some industry comrades and suffered a lot of heartbreak as a result. But yet he stands here today, on the brink, in 2023. Arcades have been allowed to persist as places that provide comfort to people busy with their daily lives and work in the real world. The origins of this go back quite far, to entertainment districts during the Edo period. Japan experienced rapid economic growth after the war and entered a bubble economy, and video game development undoubtedly went to the top. Arcades were the places where the most impressive parts of that industry were shown. Given that Ikeda saw the formation of arcades with his own eyes, it makes him feel all the more of a sense of loneliness when he sees their current state. He’s always aimed to capture the atmosphere and feeling of enthusiasm found in arcades of old, with Mikado.
March 2023 finally saw the COVID situation settling down, but there are numerous other issues hampering the industry. Soaring electricity costs and introduction of new banknotes entering circulation in 2024 will present challenges. Moreover, tensions in global affairs are escalating day by day, leading the world into an unprecedented state of chaos. Ikeda thinks of his mission, even amidst all of this, as leaving arcade culture for the world. Even after he himself is gone.
As if showing support for these feelings, Mikado’s YouTube channel reached 100,000 subscribers just before the completion of this book. Ikeda’s own foray into opening arcades in Europe is also planned to expand, with an additional location in Madrid. A certain department store has also sent several requests to Ikeda to open a location for them. But in the scope of the arcade industry, this means far more than simply opening another location. Namco practically began the Japanese coin-op industry by operating out of Yokohama department stores, once upon a time. There are many risks associated with all of this, but Ikeda feels he must move forward.
Lastly, Ikeda profoundly thanks everyone who has visited any Mikado location over the years, tuned into their streams, cooperated with him on projects, crowd funded, or helped with this very book. Mikado will continue to strive to be a place that serves up fun and nostalgia to any who want it.