LBX Collective
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 in the location-based entertainment and experience industry.
Join our online community at LBXGalaxy.com!
Proudly sponsored by Intercard!
LBX Collective
Sound Off #63 - Competitive Socializing Oversupply, Immersive Gamebox, and more!
Sponsored by Intercard!
Today's discussion dives into the rapid growth and potential oversupply of competitive socializing venues, focusing on trends, challenges, and the evolution of entertainment experiences. We also explore key market players, the future of immersive gaming, and the impact of arcade revivals on consumer engagement.
• Exploration of the competitive socializing landscape
• Concerns over market oversupply and sustainability
• Update on Immersive Gamebox and its path forward
• Area 15's expansion plans and potential challenges
• Insights into gaming tournaments as engagement tools
• Nostalgic resurgence of classic Japanese arcade games like Star Horse
• Expert analysis of trends shaping the future of entertainment experiences
Are you on the edge of your seat Because we're about to SoundOff with Kevin Williams, covering today's latest trends in location-based entertainment Brought to you by the LBX.
Speaker 2:Collective, your community, to connect, engage and inspire.
Speaker 1:All right everyone let's buckle up.
Speaker 2:Let's buckle up.
Speaker 1:All right, well, welcome everybody to SoundOff number 63 with Kevin Williams and man, that number just keeps ticking up and ticking up, but we've got a good show. Today we're obviously going to talk a little bit about trends that are happening in the business and in the industry in general, but then also we're seeing across a number of different attractions. But before that, let's change my mind. Kevin, how are you going to change my mind?
Speaker 2:Oh dear With a hammer. But the issue really is. We've seen a number of media services internationally writing the doom and gloom story.
Speaker 2:is this the end of competitive socializing? And the question out there is is the market for competitive socializing risking oversupply, overcapacity? And, to be blunt, I think you know they have a point that we are at quite a moment where every man and their dog is opening up some kind of competitive socializing. Anyone that will be watching the next sound off sorry, open and shut that I was recording just a couple of minutes ago will see quite a list of brand new openings, of new competitive socializing, especially in the retro arcade sphere. We seem to have seen an explosion of that and I'll go into a little bit more detail of actual number-related proof of this when we talk about housekeeping, regarding what's going on with our services. But generally, I feel that it's a fair comment to say that we're risking over-supply. Would you agree, brandon?
Speaker 1:Yeah, I think it depends. Of course, everything depends, right, there's always a shade of gray, but it depends on the market. So if you take a place like London or maybe even East London, where we spent some time here for EAG, I think in a scenario like that, absolutely risking oversupply of competitive socializing venues I mean, we visited, I think, eight just on our own and we didn't even get to all of them within walking distance or within a one-stop distance on the train. So I think in those types of markets I think if you look at the broader entirety of the US market, for example, or the North American market again of the US market, for example, or the North American market Again, depending on the markets there are some oversupply.
Speaker 1:So in the Phoenix area, even in Scottsdale, there's a becoming to. We went from like having nothing like a literal desert of entertainment to now, in the last three years, having a significant number of these venues. Dallas and the Fort Worth area, for example, houston, these are all areas that are seeing large numbers of these venues going in and I do think that we're going to get to the point where there's just a general glut and oversupply, especially if you include golf simulators and others into that same bucket, which I do. But if you start throwing in golf sims and sports sims, oh man, yeah, we're definitely feeling the squeeze.
Speaker 2:We're getting to that tipping moment and recently in an open and shut, I was actually reporting about a shutting of 16-bit at a particular venue and they were actually closing down after another retro arcade bar had closed down only after three years two and a half years operation at the same site. We are at that moment. 2025 is going to be a very interesting year. I also you know I'm not going to say tipping moment means such a bad thing. A tipping moment means we could also be turning up to a reality check where maybe a new form of competitive socializing business will emerge from what has become a bit of a wild Westland grab, as I've intimated before. But we can go into more detail about that at a later date. You know what time it is. Anyway, it is, it is time to hear from our sponsors.
Speaker 1:You know what time it is, anyway it is. It is time to hear from a word from our sponsors. Intercard is the only cashless system designed, developed and manufactured all under one roof. They introduced cashless technology to the amusement industry and have been leading the way for over 30 years. Cashless systems from Intercard increase customer spending, guest satisfaction and boost revenues by up to 30%. Intercard is so proud to be serving the amusement industry, and if you aren't already part of their global family of customers, they hope you will become one soon. All right, so let's dive in. Let's dive in.
Speaker 2:Oh dear, this swimming pool is a bit too deep for me, right? Well, you heard it here first from us. We were naysayed, attacked, accused of being wrong, wrong, wrong, wrong, wrong. But uh, our friends at immersive game box did go into administration, uh, the owners of, and they have been acquired, as we speculated that they would, um, a, uh, a fund, would A fund controlled by Harland Capital Partners has taken control of the immersive Gamebox owners and they have injected some capital into the operation.
Speaker 2:We're not sure how much They've cleared some of their debts, we're not sure how much that is between them and their gods, and they have confirmed that they will be increasing the expansion of the chain and continuing the world domination plans that Immersive Gamebox has. I've just got some information in that Centre Parcs has announced that they will be dropping in some immersive game box bays into their new resort development. So that process is underway and I wouldn't be surprised if we're going to get some more positive news about other installations. Just for the record, all of not all, but the majority of the board has been replaced and new heads have been parachuted in to lead the drive for the operation into the same problems that they've already had.
Speaker 1:unless they fundamentally change both their technology and their product offering and their IP, they are going to run into the same problem. It's just going to be a massive money pit for the new acquirers.
Speaker 2:I'm looking forward to seeing how much research the new owners have done and how brutal the reality check has been in why they're taking on board a company that is so successful allegedly but has just fell into administration. We will be watching this obviously very closely and I expect to hear a pivot of some sort, either regarding, as you've touched upon, the technology that they're using, the content that they're creating or the style of business operation based upon how they're going to survive in the market, or they could continue as they are and we'll be revisiting this situation again, but we will see. Start your stopwatches again. But we will see. Start your stopwatches Talking about the general overview of the market in competitive socializing and how well it's doing. Yes, some companies are trying to abbreviate competitive socializing to CS.
Speaker 2:I don't like that, but that's their band. I'd like to thank our friends at Singer for these charts here. Singer is a company that makes karaoke platforms or content deliverable platforms and they are getting a fantastic snapshot of the competitive socializing market because many of the competitive socializing venues add a karaoke component to their mix and from the singers' data that they had collected, they were saying between 2022 and 2023, rapid growth scene. They were valuing the market at 2023 at 350 million. I think that's in the low side for the UK, but we grab whatever numbers we can get our hands on. The trajectory is interesting on the first slide, where we can see a relatively gradual but strong growth rate, even with those two sectors cut out. For the COVID, we see really the market jump back in 2022, back into the fold and then 2023 onwards and I treat those numbers as relatively realistic for the UK market. The same can be seen with the average profit and loss from the revenue generated through the hospitality in those venues. That bit eaten out where COVID hit and then the growth back as the audience moved into a social entertainment audience, an experiential audience that we're now dealing with in 2025. But again, interesting data to bear in mind when considering the explosion in this part of the sector.
Speaker 2:Talking about the explosion in the market our friend that is in. They gave us a little bit more granularity to their expansion, so they have announced the plan to roll out a 20 acres expansion part of a 160 million construction package. We have a John Wicks experience going in there. We have the Felix and Paul virtual or immersive experience going in there. We have an iFly indoor skydiving. We have the Universal Horizon Leash going in. Most of these venues will be opening for 2026. So it's going to be quite a hectic building round within the Area 15 area and we have to bear that in mind, that that building work will have an impact on 2025 revenue generation. But it kind of points towards how important this gulch, this hub of entertainment, is going to be to the Las Vegas economy and I wouldn't be surprised if Las Vegas offers much more support to Area 15 to ensure successful completion of this round of development.
Speaker 1:Any comments? Yeah, I mean I'm excited to see Area 15 expand. I think this will be a different level of expansion and experience for them that I think they're going to struggle, potentially struggle to tie together cohesively. I think one of the things that made Area 15 up to this time very successful has been the fact that, with except a few experiences, they've all been under the same roof and now you will end up with a lot of independent buildings and things that are separate and surrounding the main Area 15. So you know, we've seen a couple of those experiences go into some of those warehouse buildings in nearby Area 15, come and go and struggle to do as well as the main Area 15. So I hope that some of these experiences will not feel the same effects of not being tied into the main quote unquote Area 15 that we've all come to know.
Speaker 2:Totally agree, and this kind of mirrors what we see in Dubai and some of the other leisure entertainment facilities, where you have a resort that has multiple attractions and only one attraction seems to benefit, while the others are left out in the cold. Anyone that has monitored Area 15, like we have, will have noticed that the Illuminarium, as well as the House sorry, army of the Dead, virtual reality experiences all suffered limited attendance compared to the core facility. And again, this will be interesting how many people will be going to Area 15 to go to the Area 15 facility, or will be going to the John Wicks experience or going to the Universal Unleashed, or will the duration of stay be able? I could see something like this in Orlando because of the dwell time requirements there, but Las Vegas has a different demographic, different metrics.
Speaker 2:We wait and see with bated breath. This is going to be very interesting to see.
Speaker 1:The one thing I'll add here is that until maybe this is in the works obviously not part of Air 15, but Las Vegas would have to facilitate this until the tram, there's a connectivity from the main strip to Area 15 and back to the entertainment district, I think they'll also continue to struggle with repeat visitation.
Speaker 1:If I'm there for three days or four days, I'm going to take one evening, potentially, or one afternoon to go out to Area 15 and see that, but then I'm not going to be coming back again. Right, I'm going to stay on the strip or maybe I'm going to go to fremont street or something else like that, but I'm not going to come back to area 15. So if I come to area 15, am I going to spend my time at john wick's experience or gonna? We're gonna spend my time walking around in the main area 15 building and going to some of those experiences in there that are mostly owned and operated again with the exception of Meow Wolf and Wink World by the Area 15 company as well. So I think some of these ancillary experiences are going to struggle because of the lack of repeat visitation from the typical Las Vegas visitor.
Speaker 2:Yes, the famous Las Vegas tram system that doesn't even go to the airport. I'm not too sure if I would see in my lifetime them building the tram out to Area 15, but it would be illogical to increase the dwell time if you've got an audience that's captivated. We will see what they have to do. At least Uber are going to be very happy. We will see what they have to do. At least Uber are going to be very happy.
Speaker 2:Talking about competition and establishing in the market. And we have Underpar Life, which is a top golf want-to-be. They are just about to complete their first facility opening and they have a second location in the works. This is an interesting part of our sector. You know I'm not a great fan of the golfing experience, but when it's gamified and when it's made compelling, like our friends at Atomic Golf and Topgolf have achieved, then you know it earns my respect. I'm looking forward to seeing how Underpar Life add gamification to their experience to be able to borrow the moniker of being a Topgolf competitor. But here we go. We have another entrance into the market. Then we have some development news, or some acquisition and development news In the UK the Pins Social Club operation.
Speaker 2:They have two facilities. If I remember correctly, they've just announced that they've acquired an American-style burger chain. They've just announced that they've acquired a American-style burger chain, almost famous, almost famous chain of about four facilities. Well, two facilities open, two facilities in development, I think, if I remember the press announcement correctly. Anyway, they've acquired this operation and they're going to roll it into their mix. So we will see the almost famous burger chain now incorporating some competitive, socialising elements to them and I think this will be part of a general operation within the UK that will feed both off of the high-quality burgers and also off of the social entertainment mix and our friends at.
Speaker 2:Gender, always in the news, can never get them out of the social entertainment mix and our friends at Gender, always in the news, can never get them out of the news. They announced a partnership with C Group. The two companies are going to be working together to create a operation to grow their store business, but also to grow their store business, but also to grow their karaoke as well as their licensed IP merchant products internationally. So very similar to what we were talking about last SoundOff that our friends at Sega were undertaking. I would say that what gender are doing is exactly the same the positioning of their IP and their brand internationally into the market and being able to sell their unique IP and properties to operators for price.
Speaker 2:And we've got a brand new name or word to enter the market Entame. I don't know what the derivation of entertainment and tame is, or anime or whatever. Know what the derivation of entertainment and tame is, or anime or whatever. But entame is defined in the press announcement as that dealing with the upstreaming area and entertainment and ip sale. I'll do a little bit more research and find out what entame means and if that's a derivation or a unique word to this particular deal.
Speaker 1:Whatever it is, yeah, whatever it is, I don't know what it is, I don't get it, I don't understand it.
Speaker 2:Yeah, it was interesting. In the press release I made sure that it wasn't a translation error. Gender renowned for throwing in phraseology are renowned for throwing in phraseology, so next time we get to speak to them I'll try and nail them to the table about what that actually means. But I think it's a new term to really deal with entertainment that is sold as IP and merchandise. Talking about the tech and, as we touched upon quite a few sound offs back, the tournament and championship side of the business is booming or being used as a means to build an audience. And in building that audience, we are seeing our friends at Holy Moly starting a tournament system where they have, for the next two months, tournaments taking place across a number of their venues. They're going to have about 60 teams competing for a lovely big prize of 10 000 us dollars be important to underline that it was us dollars, not australian dollars at the time of writing. And then, at the same same time, we have our friends at Five Iron who have announced their March match play they didn't call it Madness, at least which will have a number of players competing across sites in tournaments. They have to pay 60 bucks to take part in these tournaments, but there is a very large cash prize at the end of the rainbow that they're all competing for Interesting. You know, we have incredible technologies. We have Big Buck Hunter. Now we're beginning to have the competitive socializing guys throwing their hats into the ring, as well as the TGL League with all of its competition components. This is going to be a part of our industry that we're going to have to take hold of, and if we don't take hold of the tournament and competition component of the out-of-home entertainment sector, then I'm sure our friends in the gaming industry will love to jump in and do that for us.
Speaker 2:Thanks to Adam and our friends at AMNet for information on a new amusement product. But it isn't a new amusement product. It's a return of an established concept. Star Horse Party is really a kiddie-ized, or should we say scaled down, version of Derby Owners Club, or borrowing heavily from that. The system works by using collectible cards. You try and create a stable of horses. You then apply those horses to races. If you win those races, you win. You improve the stats of your horses as you progress. As far as we understand it, star Horse Party is not a medal game or coin vending game. It's just a video amusement game, the same way that Derby Owners Club in Japan and Derby Owners Club International was when they were deployed in arcades.
Speaker 2:This concept was incredibly successful in the Western market very, very, very successful in the Japanese market, but really successful in the American market, and the only thing that killed its continued growth was the inability of getting distributors getting their hands on spare parts, additional cards, horse card blanks, as well as maintaining the systems, and it just became too difficult for them to maintain it and so they left it aside. This is an interesting part of the market to see whether Sega will have the guts to take this new version of it, the Star Horse Party system, and deploy that into the Western market. I doubt it, but I always like to be proven wrong on these type of things and then quickly go through an explosion that we're seeing at the moment. We're seeing a number of companies rolling out projection-immersed enclosures immersive enclosures, as I like to call them, but not just ball throwing games or uh or motion track games, but actually having a physical shooting game or game narrative and their employment of game engines to those systems. So they're using interactive elements. They're using either weapons or hand tracking.
Speaker 2:You know, you could say that the immersive game box kind of fits into this mold, but I would say that the new generation of systems that we're seeing going in there are rising the quality of the game experience and looking at much larger multiple player experiences, and I expect to see at least two or three new entrants into this market in IALPA Europe in September.
Speaker 2:But we're now beginning to see these systems going out on test as well as being deployed in theme park attractions as installations. So we are getting very close to the immersive game experience as an attraction rather than it just being a two-, three or four-player experience. Moving on to a little bit of housekeeping a new section for us here and things have been happening with the LBX Collective as well as with the stuff that I've been involved with, and I thought it was important to bring that to our audience. First things first for you that watch maybe SoundOff, but don't follow Open and Shut. We have really been going through the ringer of talking about new developments and new facility openings. The orange represents new family entertainment centres or other entertainment locations.
Speaker 2:The blue represents new competitive socialising venues opening and, you know, each couple of weeks we have been hitting a number of these For you that are following Open and Shark. This is part of the LBX show that takes place each week. It is really interesting, especially if you look at the numbers that I quoted at the beginning of this session of how well competitive socialising is doing in the market. You can really see that we are seeing a considerable number of venue openings that warrant a lot more coverage. Regarding a lot more coverage, I've just signed an agreement with our friends at Replay that I will be doing a monthly column talking about trends in the industry. This is kind of me revisiting my past self. I used to do a regular column in replay that just talked about general amusement stuff, but this new column will be touching on the trends and the tech watch and this will really borrow a little bit from what we do in the Stinger a lot of what we do for SoundOff borrow a little bit from what we do in the Stinger, a lot of what we do for Sound Off, and then can jest that into something that is digestible for the amusement trade because they like their news in a particular way. We're going to be rolling off some podcasts during Amusement Expo. Brandon and myself will be doing that on the show floor, so prepare to hear lots of shouting and screaming in the background while we talk about the trends that we see at the show or the trends that are impacting the Las Vegas and the general market. And then I will be restarting my regular presentations at Amusement 360. For you guys that aren't familiar with Amusement 360, this is held in Indianapolis. This is run by our friends at Creative Works. This is a boot camp for individuals building FECs or entering the entertainment venue market, and I'll be doing a session kind of reprising a couple of my previous sessions but condensing them into an overall future-proofing of the business looking at if you've opened a facility or about to open a facility, how do you future-proof that, and I hope to bring some of the information from those sessions to future sound-offs.
Speaker 2:And then, regarding the general media stuff, the Stinger Report has been a bit itsy-bitsy recently. A lot of things going on in the background. We hope to slip back into our regular once-a-week formats rather than condensing them all together into a splurge of four or five of them at the same time. I apologize for that, but there's a lot of things going on in the background. We have some more virtual arenas coming out. I'm sitting on about two or three of those. Those are more the trends and the tech. And then we're adding a brand-new newsletter stroke online service to this, called the Social Arena, and, as you can gather, it's going to be touching upon the competitive socializing scene, talking about the trends, talking about the developments there, giving it its own unique news publication to focus on those developments. That is the housekeeping at the moment. That is the overall Thank you, as always, for everyone for taking the time to listen to this session. Anything to add? Brandon?
Speaker 1:No man, I think you covered quite a bit. I have some additional thoughts, specifically around just the number of retro arcade bars that are popping up.
Speaker 2:Yes.
Speaker 1:I will definitely be talking a little bit about that as well on the LBX show. So I'm definitely covering that, because you cover quite a bit of the number of those opening up in your open and shut segment. So, um, definitely, uh, keep an eye out for that. But, uh, in the meantime, let's uh, yeah, let's call it, let's call it a day. Okay, all right, everyone for that time. Yep, it's been a great sound off number 63. See you around on the next one.
