Sound Off #129 - Skill Game Ban, Times Square VR, & more!

Sponsored by Intercard!
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On this week's show we break down how retail centers are rebuilding around entertainment anchors and why that shift forces operators to rethink design, guest flow, and the real competitive set. Then we hit the week’s business and tech trends, from risky flagship leases to big IP takeovers and the growing backlash to subscription-first hardware. 

• entertainment anchors evolving from cinemas into mixed-use leisure concepts 
• differentiation inside retail districts through guest flow and food and beverage choices 
• impulse foot traffic versus timed booking and how rigidity kills conversion 
• Sandbox VR’s Times Square lease as a flagship test with heavy operational risk 
• Alterface and Phantom Wild strategic partnership as a consolidation signal 
• leadership changes across Disney, Six Flags, Busch Gardens, and major park groups 
• manufacturers leaning into direct operator influence and looming distributor disruption 
• Topgolf testing new attractions and pricing bundles to lift utilization 
• Five Iron funding UK expansion while wrestling with brand naming limits 
• Pennsylvania skill game ruling creating uncertainty for redemption and arcade operations 
• Universal Horror Unleashed using Resident Evil to prove the power of rotating IP 
• smart glasses privacy backlash and the return of a Google Glass-style tipping point 
• Sony and Xbox push toward digital-only and cloud models plus audience revolt 

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Transcript

Welcome And The Big Question

SPEAKER_02 0:02

Are you on the edge of your seat? Because we're about to be covering today's latest trends in location-based energy. Brought to you by the LDX Collective. Your community to connect in player. All righty, everyone. Let's buckle up.

SPEAKER_00 0:24

All right. Well, welcome everybody to Sound Off with Kevin Williams. This is episode number 129 for July 14th, 2026. Kevin, how are you doing, sir? I'm doing fine, thank you. A little bit hot, but uh no change there. Yeah, for sure. Brutal. All right. Well, how are you going to change my mind this time?

SPEAKER_01 0:48

Well, you know, we've been touching upon for the last couple of uh episodes, series, uh, really how uh the placement of uh entertainment facilities within the mix works.

Entertainment Anchors Return To Malls

SPEAKER_01 1:02

And now we're seeing a number of malls uh and uh retail gulches uh including a dedicated uh entertainment anchor component to them. And it is really this is quite a large opportunity for us, especially as the retail industry goes through a major change in how it fits into uh the market. Is it being used mainly as a kind of showroom for people that are going to be purchasing online? Is there a possibility of maybe incorporating a strong entertainment mixed to increase the dwell time? Or is there something a little bit more taking place here where entertainment can stand as its own uh outage? You know, for those of you that aren't familiar, uh many malls used to have something called entertainment anchors, and they used to treat those as either cinemas or as uh fun food, entertainment, restaurant chains. Now that entertainment anchor is being seen as a competitive socializing mix or as a mule, as a mix uh use leisure entertainment component. And that is something that we need to think about because we need to change the design and the layout and the operation the same way that Dave and Busters has to go through that change when they attach one of their Dave and Busters facilities to a mall, an existing mall component.

SPEAKER_00 2:28

Well, yeah, and I think thinking about your mix, thinking about your guest flow, what is your food and beverage mix as well? Like what are different restaurants that are in the retailtainment districts? Are you competing with them on certain types of foods? Like the style of food. Is there an Italian restaurant? Is there a Chinese restaurant? Is there an American restaurant? What food, how are you differentiated? Um, on an entertainment level, it's a little bit easier, assuming there's you not uh other entertainment things there, but you know, you are bringing the entertainment to this retail district. Um, but I think also when I think of retailtainment, it's not just you providing entertainment to a particular existing retail, what will I call it, you know, a retail mall or shopping center, um, but there are retailtainment locations. You know, this is we talk about camp being one of those really strong, powerful, uh very well done retailtainment destinations where you come in to not only buy things, right? You come in for the experience, but then you end up leaving with particular IP and merchandise related to that IP. And so I think you're also competing with those types of retailtainment destinations that are inside of these malls. So, how are you differentiated even from actual retail taintment locations themselves?

SPEAKER_01 3:39

And we also have the mix now of certain of the larger brands, for example, the picture that we're using to illustrate this, this particular Plymouth uh shopping mall actually has a Legoland uh attraction within its operation. So, again, trying to bring in a mid-scale uh resort entertainment component against your uh location-based entertainment could be quite a daunting change. Who are your customers? Who who are you competing with? What is the differential from your offering compared to the other offerings? Those are the things that you need to be asking yourself. And it is a very bumpy ride, as we have touched upon, uh you know, our friends at F1 Arcade, they created a what I would call a retail attainment version of their concept with uh F1 box. And as we've seen, that really has stalled at the starting game.

SPEAKER_00 4:38

Yes, uh good pun there. Good pun. And we don't really know why it's necessarily stalled. Um, you know, they continue to roll out their F1 arcades, but the F1 box seems to be a perfect fit for one of these types of retail shopping district areas.

SPEAKER_01 4:56

It it needed more time in the oven, from my personal opinion of what it was, but what it was trying to fit into the marketplace uh seemed a logical move by them. If you know, if a retail facility doesn't really want to have an F1 arcade, then this was an intermediate component. That also said uh we have seen our friends at Gravity Max try and roll their uh Mitchie's Leisure Entertainment facility into a more centric shopping venue component, and that has only seen three facilities open so far.

SPEAKER_00 5:31

Yeah.

Guest Flow And Food Differentiation

SPEAKER_00 5:32

No, that's fair. And I wonder if this is something uh to think about. So yeah, the impulsivity of your particular attraction, is it uh or your your entertainment mix, is it something that I can go in and do? Maybe I was going to Dix or I was going to Burlington to use some of the examples that are here on the screen. And then I'm walking by and I see something, I'm like, oh, I'm gonna pop in here for 30 minutes and see what's available, and I can go play some uh some amusement or some redemption, or I can go do a ride simulator or play a quick round of mini golf. Like, how much, how, how, you know, if you're going into one of these destinations, is it about impulsivity, or is it about making sure that you are part of like being having to plan? If I have to go in and book a time, well, maybe I can go book a time, then go shopping, and then come back from my booked time. But am I going to stay in your facility while I'm waiting if I was there for other reasons? And I think those are some things to consider as well when you're in this type of retail entertainment district.

SPEAKER_01 6:30

Impulse uh customer or walking traffic, as it's called more commonly in the amusement side of this uh sector, is more common in this kind of environment as a percentage of your audience compared to away from uh this kind of thing. So it's foot traffic uh against drop-in, but many of the location-based entertainment narratives that we've been talking about in recent uh sound-offs don't work well to just impulse purchase. You really have to make a decision that you're going to uh spend some time there. For example, an activate is not something that you're more common to do on an impulse. You're going to have to book a certain period of time. Your 60-minute uh slot is going to have to be booked, and you know, you don't know what availability is like. Flexibility, booking, and the ability of maybe supporting drop-in traffic rather than just being rigidly uh uh focused on timed uh bookings are all factors that you need to consider if you're going to play in retail attainment.

SPEAKER_00 7:36

Absolutely. All right. Well, coming back after the break, we will dive right into the business trends. Intercard makes cash flitts easy with award-winning readers, self-serve kiosks, real-time reporting, and flexible guest payment options. From plate cards and credit cards to mobile payment and QR codes. It's introducing the industry's first cartoon in 1989. Intercard has helped operators reduce cash handling, increase guest spending, and run smarter venues. Visit IntercardIn.com to learn more.

SPEAKER_01 8:15

Well, thank you for that. And we jump straight into the biz.

Foot Traffic Versus Timed Booking

SPEAKER_01 8:20

And a surprise one for me here. You know, our friends at Sandbox have been steadily, you know, moving along uh with their franchise business. We're in the high 80s now with them, uh rushing towards 90 and I'm sure 100 facilities

Sandbox VR Bets On Times Square

SPEAKER_01 8:38

opening before the end of the year, if uh the rumors are true on the street. And then out of nowhere, from my point of view, we hear that uh the company has, you know, taken on a 10-year lease on a very expensive piece of property. An incredibly expensive piece of property located within Stones Throw of Times Square. So that brings all of the issues of uh operation. It is quite a large space, uh, it's about uh 10,000 square, multi-floored environment, um, and they're going to be dropping in their current uh version of their sandbox VR operation. From my point of view, this is a flagship site. We saw our friends at um The Void go for a flagship New York site, and that was one of those projects that uh really pushed them over the edge uh because of the expense, not just in the lease that they had to sign, but also in the price of staffing and operation. I don't think the uh facility that I'm remembering uh at the uh Oculus in New York didn't even last 12 months. Uh, and it was uh an indicator of the problems that were about to hit the void. And now we're seeing Sandbox VR go for a very prominent space. A stones throw away from a very important Dave and Busters location, a stones throw away from some other uh tourist-related uh entertainment facilities. I expect this to be open by next year, middle of next year, and we'll be watching with great interest if they will be able to just open this without any F and B or whether they're gonna have to buy the Buddha.

SPEAKER_00 10:27

Well, I mean, hopefully they at least add in some beverage options and and you know, some cocktails, like you know, whatever. This this one seems to be jumping the shark for for them. Uh, I don't know if this is uh corporate-owned or if this is a franchise location. Uh, if it is a franchise location, oh I hope that they really did their homework. $750,000 annual rent is extraordinary for a sandbox. I don't know how you actually make money with it. I don't know how they modeled it out. So if it is a corporate location and they're really just trying to get brand recognition in Times Square and it's supposed to be flagship and it's gonna be a loss leader for them, okay, fine, pocket up as a marketing expense, whatever, um, for your brand and for your IP and your attractions. And then you know, they may maybe play sandbox VR in Times Square and then they go back home into Chicago or wherever their home is and they play sandbox there again because they loved it so much while they were visiting Times Square. Um as a, but we were just talking about impulsivity. The problem with this is you go down to Times Square as a tourist and you're wandering around, and you're either going there for Broadway if you're, you know, or for or shopping or something, or just to go take it all in and you're going to just walk into a sandbox? No, probably not. You're going to have to book it ahead of time in advance and plan it with your friends and feel like Times Square is not the place I want to have to go and contend with from a traffic and people standpoint to go and just do some entertainment with my friends. I feel like they would have been better served to have a flagship location slightly off Times Square and really focus on marketing, maybe in Times Square, to drive people down a little bit off Broadway, so to speak.

SPEAKER_01 12:09

This could be part of one of their investors making available to them a sweetheart deal on a property. Of course, we have to take that on board. This could be part of a brand new marketing approach where they're going to use this venue as a kind of uh sugar pill, uh, you know, promote the brand through this. They will make sure that during the Christmas celebration, the new year celebrations and festivities that they're front and center. Um I would just say a billboard would have been cheaper. Moving on, and uh some news that uh we kind of knew about during the IALPA Asia, but it's been cemented with a press release, and I I thought it deserved to you know to be officially uh stated here in Sound Off.

Alterface And Phantom Wild Team Up

SPEAKER_01 13:01

We we've dealt with Ultraface on numerous occasions. They are one of those companies that has worked very hard on the development of interactive dark ride attractions, they have rolled out a number of dark rides that have a shooting digital element, gamification element to this. They have been striving to move to the next level of engagement regarding interactive uh attractions for the international market, and uh they've kind of signed a very high-level strategic partnership with Fanta Wild, uh, an Asian uh developer and operator in that uh territory, and they have signed this uh strategic partnership towards developing next generation interactive attractions. Uh what those will look like, I think we may get a better idea in November at IALPA. But this kind of is what I think we'll be beginning to see, which is the media attractions industry consolidating, as I've said many times before, but also consolidating towards their future business positionings in the digital market.

SPEAKER_00 14:18

Yeah, and this sometimes is how a future acquisition or merger happens. They form a strategic partnership, they do a little dance together, it's a bit of a courtship, see how well their different sets of expertise collaborate and work. Phantom Wild obviously having a little bit more of the culture, the cultural attractions component alongside technology, you know, integrating culture with technology, Alterface being a uh you know, a pretty hardcore uh interactive attraction provider and creator and developer. And so, yeah, these two could do some really interesting things together. And I wouldn't be surprised if we hear a year or two from now that these two are merging officially.

SPEAKER_01 14:59

Yes, this could be uh a consumption uh more than just a strategic partnership. But also, I think this is allowing uh Phantom Wild access to some attractions that they're in desperate need to keep themselves fresh uh with their market operations. But it is a marriage of convenience so far. Let's see how much of this uh results in offspring. Moving on, and uh the you know, the makers and shakers of uh the sector continue in the C-suite department.

Theme Park Leadership Dominoes

SPEAKER_01 15:33

You know, we kind of knew that Joe was going to be uh parachuted into the uh position of Walt Disney Resorts president. He has a long uh history with uh the Walt Disney Corporation, uh from everything from Shanghai to Euro Disney. Um, incredible resume for a Disney uh director, and I would I would actually point to uh that kind of resume, meaning that he's uh on a trajectory for C-suite top level. Uh but uh at this point in time, the uh uh Disney World Resort needs some TLC after a period of uh change. Uh and I can't think of a better man to be parachuted in to bring that.

SPEAKER_00 16:19

Yeah, absolutely. I mean, there's no better resume than you could imagine to have uh to have coming into taking over the Walt Disney World Resort. So wish him much luck, and yeah, again, would agree, wouldn't it wouldn't be surprised to see him um over much of the Disney parks, if not all the Disney parks at some point at the C-suite level.

SPEAKER_01 16:37

Yes, it's it's one to watch. The kind of things that he's going to have to be focused on is he's going to have to be making those changes now that a lot of the uh previous management's opinions about how attractions should be operated, the changes that we're seeing with the Star Wars uh areas of the park, uh, as well as the dropping in of especially the new villains concept, which still hasn't been uh solidified 100% to the market. These are all the things that will be under his tenure, and you know, he's going to be busy, but from his time at uh Shanghai and uh Euro Disney, he's used to that. Moving on, and Six Flags has uh uh parachuted in a new chief of operations, kind of expected that there was going to be uh one uh going to be uh taking place. Mark brings a lot to the table. Uh, you know, he's he's been involved with uh the Palace Entertainment growing pains. Um, and you know, I think what we'll be seeing in the next couple of months regarding Six Flags Entertainment is the nailing down of a strategy of how they want to move forward and how they want to profit from their position in the market, especially as some of the IP that was previously available to them has been taken off of the table. So there's a lot of things to consider here, as well as the ticket pain that they've been going through recently.

SPEAKER_00 18:09

Well, and I think what he brings a really interesting pedigree as well, given the fact that he was involved or whether he was in charge of or at least involved in integrating Palace Entertainment into the Herschend family entertainment mix. And so he's now coming from Herschend, which has historically a great culture, uh great people culture as well. They really run well, you know, very well-run parks. And maybe he's coming in to help really try to figure out how to merge the Cedar Fair and Six Flags cultures together and create a unified culture. I wouldn't be surprised if that's still something that they are struggling with, uh, you know, certain identity issues around the different parks that are out there. And hopefully he'll help to bring some clarity and some direction to that.

SPEAKER_01 18:57

It's clear that his predecessor found that difficult, though his predecessor will now be moving on to an advisory position, uh, while uh Mark now has to get his feet under the table and really deal with this situation. So maybe he is the right man for the job here, though I would also argue that the overall Six Flags entertainment offering is going to need some real C-suite advisory. Moving on, and Bush Gardens has uh parachuted in a new president uh to uh their operation, uh, and an individual that comes again with uh a lot of theme park experience, wild adventure theme park, uh, as well as a singing position with uh compost theme uh theme park. What really is needed with Busch Gardens generally, not just the type of Florida uh operation, but the Busch Gardens brand is going to be fascinating under the current conditions because we've just named two operations that are going to be changing their positioning and you know, restructuring themselves and repositioning themselves. And really, are you going to be a firefighter or a fire prevention officer regarding the brand? Because those are the guys you're going to be competing against. You know, I'm prepared to even take a risk that we haven't even heard Dollywood talk about uh maybe dropping in a new president. Is that the next domino that we're going to see for?

SPEAKER_00 20:29

It might be, it might be. Um, you know, I think what is they're gonna they did, oh my gosh, they did a good job. Um, I think finding I don't know John myself personally, but just given again his resume and his background, working at Wild Adventures theme park, animals as well as entertainment. I mean, those are two things that require a lot of unique expertise, and there aren't too many animal slash theme park uh you know, or attraction slash you know, theme parks and adventure parks out there. And so the fact that uh he has that experience uh working at Wild Adventures theme park, and now he can come into a bush gardens is uh, you know, I think a good find that uh he was able to come in with that type of mixed experience.

SPEAKER_01 21:13

It is, you know, the HR team did good finding an individual with uh those types of credentials. I could only think of about four other part kind of operations that have that kind of broad mix. And from Bush Garden's perspective, they are also going through a transition in brand positioning. Uh, you'll notice that their brand has actually changed, moving slightly away from the animal component towards more of the entertainment component. How much of that will continue under uh the new president? We'll have to wait and see. Interesting. We've been talking about uh Park S uh a number of times uh during previous sound offs, and uh they have decided to take on a new group director of entertainment. Uh reporting to the C-suite, very important uh uh uh perspective. Uh uh Mark has an extensive background uh in the theme park uh and entertainment sector. Um, haven't had the pleasure of actually meeting him, uh, but uh know of the work that he's done for some of the other park involvements. I just feel that really what you're going to be doing with this particular operation is going to be considerable. There is so many things to think about now that you've offloaded certain operations, now that you've repositioned your corporation from a European standpoint rather than a heavily international standpoint, there are going to be a lot of developments to consider and the possibility of uh is this operation going to go back on the acquisition uh spree uh now with the change in market.

SPEAKER_00 22:55

Yeah, I mean that that's what I was wondering. Here is okay, he's coming into uh an a group that is going through a little bit of turmoil themselves, um, you know, just with some uh divestments as well as some changes in their focus. And so it would be interesting to see what he has to focus on as the head of entertainment going forward.

SPEAKER_01 23:17

Having to still report to the C-suite kind of is a statement that's put into a press release to say that a safe pair of hands is going to be steering uh some of the decisions. It's you know a euphemism used in uh media journalism uh for press releases. There's also something under the surface here, which is certain sources have made it clear that this uh that they still have aspirations to divest themselves of certain operations. If that's true, we'll know about that by November. And if that's true, that's even more work to have to consider.

LAI Games And Distributor Pressure

SPEAKER_01 23:51

Moving on, and uh from the theme parks to the amusement and LAI games uh has taken on David as business development and sales executive. Uh he, from the description in the press uh announcement uh and how it was sort of laid out in front of us, uh he's going to be doing hearts and minds as much as he's going to be uh strategically positioning what LAI Games is going to be doing next. Remember, LAI Games is really controlled from its Australian head office, uh, and you know they depend upon uh their North American executive team to help with that steering of development uh and understanding what the customers need. Uh, that David comes from uh previous background with uh Andretti's tells us that he understands a little bit the pain and anguish that operators are going through and the sticker shock that many are going through. I would also argue that one of his key jobs is going to be looking at what their next generation of releases are and are they suitable for the market. We have to admit, I know it's painful for LAI, but you know, their previous management that were directing them on certain releases may have missed the target considerably, and their Singapore team has paid the price for those target overshoots, and now the games that they're going to be thinking of releasing in the next 12 to 24 months are important to uh redressing uh their fortunes. How much of that is going to depend on Chinese licensed products is going to be interesting. I didn't see David at the AAA show, but I saw everybody else from LAI Games walking around there looking at the latest releases. So again, from and manufacturer uh that also has links to an operator. Remember, LAI Games is all part of the group that includes our friends at Time Zone. You know, they are going to have to position their products for a very important 2027-2028 market.

SPEAKER_00 26:07

This is an interesting one and a role that we've seen pop up here and there for different for different brands. Um, Clint Novak, who's been uh you know, a guest gab, uh, done a number of guest gabs with us and has a regular, uh often has regular session uh segment on the LBX show. And he uh he was the embass, he was a basically a brand ambassador for ANA Global, and he traveled around from location to location and you know met with the met with customers and you know promoted the ANA Global uh element. So you know he's doing sounds like this very similar thing. I think what's interesting here though is that this is almost in some way circumventing the distributors. So this is, hey, you know, we're sending, we're not getting enough love or attention or visibility potentially to the operators through our distributor relationship. So we're gonna send David around to all of our different existing customers, and he's gonna go and promote the different and see what's on the floor, see what's working, promote, hey, maybe over here you could put this game or this game might work really well over here. And again, um not necessarily trying to take direct to direct to business, um business away from the distributors, but um, in some ways, doing what the distributors should be doing, which is recommending particular things. Um, but this is LAI being able to come in and do this. And I will, I do wonder if we will see this with other manufacturers of games following a similar trend, sending their ambassadors around to different locations trying to promote their specific games.

SPEAKER_01 27:35

It's uh kind of a dirty secret in the US uh amusement scene that there are brand ambassadors that don't have that written on their business cards, but they indirectly or directly act as sales agents and sales representatives. This is a front and center business development position. And you're quite right. I expect to see many other manufacturers doing that. I also expect by IALPA in November that we will have a clear line in the sand regarding what is happening with the distribution scene in North America. Um, there's a strong possibility that by the time we get to November, we will be minus at least one of the distributors, and then that will put the cat amongst the pigeon, as it were. Watch this space. It is something that we're going to have to reflect upon in 2027 about where the manufacturer fits into the mix with the operational scene and where the distributor brings that value added that warrants that 20% markup. Moving on, and we called it uh, you know, we didn't need a large crystal ball to say that, though.

Topgolf Tests New Entertainment Mix

SPEAKER_01 28:50

Uh in an interview for uh the Dallas Business Journal, uh David at uh Top Golf confirmed that um you know they were reinforcing their uh position in the market, they were trying to deal with uh, you know, trying to offer a better guest experience, and that they were now looking at uh lower prices, prices bundles, working with youth leagues, working with tournaments, and as we called it now were testing uh the inclusion of entertainment alongside their shooting operations across all of their venues, and that included evaluation of pickleball, yeah, okay, uh inclusion of darts and the inclusion of amusement. We called it uh that this was going to be something that they were going to have to face. Uh, and uh I think David has laid the the groundwork for us to be able to stand in a top golf facility and see multiple entertainment offerings rather than just the shooting base.

SPEAKER_00 30:00

Yeah, absolutely. Uh while I appreciate the fact they're going to be testing other entertainment, uh, including pickleball. I mean, pickleball is just an ironic one given top golf and the amount of square footage and land use that they have on a and their per square foot, their their per square foot revenue is uh is probably one of the lowest in uh in the world, just given the size of the facility. So why not add pickleball that has a traditionally low per revenue revenue per square foot? But no, anyway, I mean I'm glad to see they're trying other things. Ideally, they try other things like this, like things that go into bays. You have all of these empty, you have all of these bays. Why not convert some of your bays into darts, you know, dart bays and other sim bays and and soccer bays and other things like that? You've got already have that built with seating and everything else. There's you know, why not try to experiment with adding in uh some of those? Drop a screen or something like that down in front, uh, and then you know, you've already got all the rest of the infrastructure there. So anyway, I'm sure David is thinking through all of those things and the rest of his team, but it is great to see that they're finally going to begin to experiment with other attractions and mixing them in with their existing platform.

SPEAKER_01 31:11

You would have been thrown out of the top floor of the C-suite offices if you had suggested this 24 months ago. Yeah, that's fair. Just saying how things change, but there is a very important lesson to be learned here. If you have access to the operational data, you should be able to look on a spreadsheet or an automated piece of uh software and see which of your bays are utilized the most. You then do a simple calculation of saying if we remove those bays that aren't being used as much as the other ones and turn those into entertainment bays, um, what is the increase in payment? That is a simple entertainment perception concept that could be easily activated. I just hope that David is being advised by individuals that come from an entertainment background rather than individuals that are desperately looking for a paddle for their canoe.

Five Iron Expands With UK Funding

SPEAKER_01 32:14

Moving on, and we have news from our friends at uh Fiveiron Gulf, you know, that you know they've been investing quite heavily into uh their international uh operation. And you know, they have now revealed that 20 million has been injected into their UK operation to start rolling out a considerable number of UK-based uh five iron facilities. I didn't include the word golf there because doing some research, I came across some branding, and there's a strong possibility that that golf uh denominator may be softened slightly in this rollout because a number of these entertainment facilities that will be going into the UK, uh the first ones opening in 2027 in London, will be mixed-use leisure entertainment facilities. They just won't be pushing the shooting simulator bay concept, but they will also be including the uh duck in bowling and the amusement and some competitive socializing elements. Anyway, you know, we have to wait and see until the first ones of these sites open in the UK. You know, they if you have 20 million, you're going to be opening more than five in the UK, at least. That's a safe bet, unless you've got some real expensive transatlantic flights planned. Uh, the one thing that I always love to point out, so we're just talking about our friends at Top Golf. Always remember that Five Irons Golf is partly backed by Callaway Golf, who just divested themselves of their involvement with Top Golf.

SPEAKER_00 33:58

Yeah. Uh well, yeah, I mean, so uh they certainly need to be branding. I mean, I like their their tagline, we make golf for everyone and other things. Uh yeah, they do they've really begun to do what you know they should be doing, but this is one of the difficulties we talked about on this show and on on uh open and shut on the LBX show. When you establish a brand name, if you too narrowly niche your your entertainment within your name, then that really becomes it can become a future problem for you that you have to unwind. And so if they had just been five iron and then have a tagline that had said, we make golf for everyone, well, it's a lot easier to change your tagline. You could be five iron with then change it to other things, you know, golf, sports, food, right? Or whatever you want to do and change your tagline down the line. So, anyway, they are going to, I think, have to eventually address that issue with their logo and with their brand. But in the meantime, we'll see how many of the locations they actually get open with that 20 million pounds. Uh, don't think it will be 10.

SPEAKER_01 35:03

It won't be 10. Uh, and it will be very dependent on how well the first London facility opens. Where they're opening in London, it's going to be expensive. Uh, finding a good 6,000 square uh space within a catchment for a flagship entry of a brand such as Five Irons is going to be interesting. Uh, I would also point to the argument that this could be a brand changer where the first facility in London will also be used to maybe go back and look at the uh existing brands in their international offering in North America and other countries. Whatever the case, the whistle has been blown here, and uh it uh we will wait to see what 2027 brings to us from this particular franchise.

Pennsylvania Skill Game Legal Shock

SPEAKER_01 35:57

A real weird one here, um, pushed under my door. You know, uh it was pointed out to me that uh you know the Pennsylvania Supreme Court uh ruling was going to take place, and they did. Last month uh they made it clear that you know it is illegal to uh to unlawful to uh run certain uh of the skill gain machines uh on their naughty list, and their naughty list included redemption machines. Uh it was really confusing, uh it was badly worded. I've tried to read numerous times the state ruling on this, and you know, even the legislators have made it clear that this is something they're gonna have to go back uh and deal with. A local distributor uh and manufacturer in uh in the catchment of this has turned around and said, you know, you do know that uh these are there are Chuck E. Cheese's operating machines that would fall foul of your new legislation. This legislation was put in place to try and deal with adult gaming uh and gaming machines, and someone wrote it with a very thick pen and didn't quite understand the nuances of uh the differences in skill game uh applications. Whatever the situation, a lot of operators and a lot of manufacturers are waiting with baited breath to see what the final decision is going to be, and whether the Chuck E. Cheese defense, as it is being called, will allow amusement machines to slip under uh you know, slip under the radar of uh this. The idea of um court officials kicking in the door of a Chuck E. Cheese facility and hauling out uh redemption machines as illegal skill game platforms. I don't think we're gonna see that happening, but this is a perfect example of where the trade associations behind the scenes are gonna be, you know, like the swan, very serene on the top, but those feet are going to be moving very quickly under the water.

SPEAKER_00 38:04

Yeah, well, we'll have to wait and see this because this is the big giant fear of many, many arcades that deploy redemption games. And we've talked about the fine line between skill and non-skill redemption games as well. But you know, when you even have skill games, things like skee ball actually being listed potentially as one of these elements, then that really begins to say, well, look, you know, if skee ball is considered unlawful, what are we doing about Big Bass Wheel?

SPEAKER_01 38:35

A smart attorney could force every redemption machine manufacturer to prove that they don't fall foul of this. This would then start a dominoes because there are other legislative practices looking at this kind of, you know, this is not just a test case, as it were, this is uh a statewide process. And we could see where, you know, if one particular Supreme Court goes one way, then others will follow to also, and that's something that some parents have been, parents' groups have been complaining about in the background, where the kitty casino syndrome. We've talked about this on numerous occasions on sound off, as a red light that we should be aware of in the amusement industry and be protecting ourselves from. Sadly, the gatekeepers in the amusement trade feel that this isn't important uh and the situation will sort itself out. I do know that the trade associations in private are working very hard to speak to the Hill and also to speak to local courts regarding the positioning of their industry. But at the same time, if you allow adult gaming machines on your trade show floor uh and also kind of if you sleep with dogs, you catch fleas, is really uh what I'm trying to elucidate. My biggest problem here is this takes a lot of cycles to deal with. It's very expensive. And I don't think some manufacturers are going to be in a position to protect themselves against uh what this legislation could bring if it falls uh out of favor. And I'm wondering how shocked and surprised some in our industry are going to be if this falls the way I think it could fall uh regarding the positioning of some amusement skill games. You know, it's it's going to be like that scene in Casablanca showing my age. You know, uh I'm shocked, shocked that gambling is going on uh in this uh institution. We are at a point now where we'll need to prove to not just our audience, but to legislator that we are a clean skill game market in amusement, or else we're gonna be hoisted on a very big patard.

SPEAKER_00 41:04

Yeah, yeah, exactly.

SPEAKER_01 41:07

Anyway, the Taurus of Pain for all of you that are keeping track, uh a weird bloom, but uh you get the idea we had a lot of theme parts included this session. But anyway.

Tech Trends Kick Off

SPEAKER_00 41:19

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SPEAKER_01 41:54

Thank you for that. And jumping into the tech and IP trends and IP big.

Resident Evil Invades Horror Unleashed

SPEAKER_01 42:01

So you have Universal Horror Unleashed, bring your own dog. And the issue is for me, that a couple of sound-offs ago, we were talking about the addition of new attractions to this, and that they were showing us that they were going to be keeping it fresh and uh up to date. And now the news drops that they're going to be creating a Resident Evil takeover pop-up experience. Now that's Resident Evil based upon the popular Capcom video and amusement game series. Uh this is Big IP married with other Big IP, lots of themality, lots of opportunity, and I am sure it is the beginning of specially themed horror pop-up elements going into the theatre stage that is the unleashed out-of-home entertainment venue. I'm not sure if our industry really woke up to how big a deal this kind of thing is. Capcom wouldn't uh make available their a Resident Evil IP, which has also had a film franchise uh release, uh willy-nilly. This isn't just, oh, let's have a couple of characters dressed up as Ken or some of the others from the franchise. This is a big move and with uh soon-to-be-open Chicago uh Universal Horror Unleashed venue going. This is their, shall we say, the Netflix house moment?

SPEAKER_00 43:34

Hmm, indeed. Interesting. Well, I mean, look, this is what we hoped would happen when we when they first announced that they were doing this physical space with four different horror experiences uh or scare experiences and uh and and the fact that we were hoping that they would be rotating new things in, new concepts, have pop ups, have unique themed events. And so it is good to see that they are doing that, actually. Uh and I do wonder, are they taking over the entire facility or are they taking over one of their particular haunt experiences and making that a resident evil takeover? So that I think would be is is probably to be explained. It makes it sound almost like they're taking over the entire facility. But uh, but uh, you know, that'd be interesting. And how and then what is the length of runtime that it will exist in this particular location? Because that will reduce their repeat visitation if they are taking over the entire facility, because now no longer do can I go do four haunts? I can only go do one haunt for a period of time. And so, yeah, we'll see what their strategy is there. But at least I'm glad to see that they are bringing in new concepts, but also bringing in really significant IP. Transform the venue.

SPEAKER_01 44:47

Direct quote from the press release. Right. They're going to have special food, they're going to have special cocktails, they will be doing exteriory theming, they will be doing major interiory theming, they're going to be adding interactive games and will have live actor components. This is major. How many of our industry observers have spotted how major this is? I think they'll they'll be surprised when they go to Area 15 in four months' time because I'm getting the feeling that this is going to be ready for their Halloween operation. Indeed.

Luxury Retail Gets An Arcade Floor

SPEAKER_01 45:29

Moving on, and we touched upon this in uh open and shut, but our friends at uh Gaigo, uh Gender moment, but Gaigo has now parachuted into the retail attainment side of the business. See the pivot from how we started, well, not pivot, see the link from how we uh started the beginning of this retail attainment. Well, you can't get more retail attainment than putting in a bloody amusement entertainment operation uh inside a luxury goods store. And so uh the venue in Tokyo has dedicated a floor of their facility, about 206 square meters worth, to M2F, which is a group of amusement machines that have been customized to suit the uh the design, the layout, and the styling of this uh luxury goods store. So really is we've got a luxury goods footwear company opening up a brand new luxury store in Tokyo and putting in it an entertainment facility. You don't get much more retail attainment than this. And is this something done because it's stylish, it's Tokyo, and they did a really good deal with Gender, or is this something where they feel that retail attainment directly linked to their customers' dwell time and buying habits, and it's a good piece of uh operational interest? Does this increase the spend? You know, these are all the questions. Is this done as a flagship uh frippery, or is this something serious across the 100 plus stores that this particular brand operates uh in Japan alone?

SPEAKER_00 47:18

I think it'd be interesting to understand which you know, whether the tail wagged the dog or the dog wagged the tail in this particular case. Or was it you know one of those where an executive from Gaigo and an executive fromatsuku were grabbing dinner and said, Hey, you know what would be cool is if we did this, you know, and they just hashed it out there over dinner and figured out a way to put something interesting and try uh try and experiment here. Because I, you know, is this something that Gaigo came to them and said, Hey, we really think we could do something amazing here for you on this floor? Or did uh Onitsuka Tiger come to Gaigo and say, we would really like to add an amusement component? And it just seems I'm curious which direction it went because I think that will be very indicative of whether or not we see this roll out to the existing other locations more quickly, or whether they really wait to see how well it does.

SPEAKER_01 48:16

We have seen from the footage of the facility that there are amusement cabinets that are used as uh unique display booths. You know, there is a full arcade cabinet with the screen removed and a pair of shoes placed inside it as a unique display case. On asuka's um marketing and development and uh design team has been directly involved with this process. It is clear how much of this is a PR spin to utilize some space within the facility, or if this is going to be replicated across other of their facilities, time will tell. Indeed.

Interactive Floor Games Hit Scale

SPEAKER_01 49:03

Our friends at uh Pixel Games have had a lot to shout about recently. They have now installed uh hundred uh of their II, as I like to call them, interactive illuminated floor uh game systems uh across the uh international market. And you know, to round that off, they made the announcement that they've uh done a deal with our friends at uh Gamescape, who we were talking about in a recent uh open shut, and that they have created a special version of their IAF uh platform. You know, it's a nice enclosure, it's a twin floor system with a launch kiosk. For me, looking at what they've done with this particular installation reminds me a lot of what Fogg has done with their game grid kind of installation. I think this is a better way to go with illuminated floors rather than the open plan, but it does show that they're prepared to do customized versions of this system. And then while we're celebrating a hundred systems in the market, we also get the news that um Pixel Games has signed a relationship with our friends at Gravity and that they're going to be installing 10 of their IIF uh floor systems across their uh chain of facilities. They already have uh in Gravity Max at least two Gravity Maxes uh their interactive floor systems, and now we will be seeing the Gravity Actives also benefiting from these floor systems. This is a part of the market that, you know, an application, a platform, a genre that has proven very popular. Um, and I expect to see Pixel Games focusing a lot more on customized relationships with large chains to establish uh the numbers that they need to hit to roll out their platform, as well as they're now in an active battle with uh you know our friends at LAI Games who also have partnered with Fogg to release their interactive floor system. It's nice to see this competition. We will hope to see other platforms entering the market offering the same kind of level of entertainment engagement. And I expect at least two other systems to throw their hats into the ring around uh IELP uh uh Orlando time.

SPEAKER_00 51:37

Yeah, indeed. Uh well, look, I'm just happy to see that Pixel Games has been expanding and doing as well. I really like the new installation that is going into Gamescape. The it feels much more unattended, sort of automated, dedicated, and less of just an afterthought thrown into a corner of a facility. So I do like this direction they're going. And uh, you know, it's interesting to see the pivot that Laser Force has done over the last few years to really focus heavily on pixel games. Um, and not to say that they have not focused on their laser tag experiences, but they've really moved heavily to focus a lot on the pixel game component as well.

SPEAKER_01 52:19

I would point our audience to the coverage we did in the Stinger report last year from IALPA of all the things that Pixel Games was proposing to do, their shooting gallery system, their weird-angled uh enclosure system, none of that has appeared. All of the focus has been on the interactive floors. Uh, you usually see this kind of focus when you know that they're making their core business out of this. Pixel Games USA is very focused on their illuminated floor. How they move forward with that, customized systems, especially as they're going to be dealing with competition, that is not just going to be doing illuminated uh panel floor systems, but are going to be using the latest technology to stay relevant, as we've talked about from our friends at Moment Factory.

F1 Pop-Ups As Experiential Marketing

SPEAKER_01 53:15

Moving forward, and uh Holoviz, we were talking recently about their involvement with Netflix House, and now we're seeing a little bit more exposure to some of the other projects they're working on. And recently they uh installed a temporary pop-up F1 racing experience uh in the centre of London. This is part of the Williams F1 team's promotion uh of uh the build-up for the UK Grand Prix and all of the uh F1 Grand Prix uh activity. You know, and they've dropped in 10 simulators within a space, linked them to the digital screens of the Piccadilly Lights Facility. This is the same place that we held the launch for uh for uh uh some of the entertainment uh experience venues uh recently. It is a lovely um projection environment, it is a digital space. You know, people playing on the simulators were reflect uh reflected in the uh projections that were being put on the big screens, floor as well as walls. It was it is still operational, a very interactive entertainment environment. And I hope that someone from F1 uh arcade popped in to have a look at how you can really do this.

SPEAKER_00 54:45

I'll leave it at that. I'm I'm I'm sorry, I'm just a little uh I'm a little skeptical of this experience. I mean, I appreciate its location and Piccadilly lights, and uh, you know, it's going to get a lot of attention. Uh, but this was probably a very expensive attraction uh because it's custom to the single pop-up installation. And so yeah, uh this uh hopefully hopefully it doesn't need to generate an ROI, I guess is my point.

SPEAKER_01 55:13

Isn't the first time that they've done this here? Um they use it as a marketing tool. Uh obviously, the Williams marketing team doesn't have donuts on one Friday of one month, and they can afford to drop one of these attractions in. But it is an example of the level of interactive entertainment that pop-up marketing attractions have to offer, near enough building an F1 arcade, uh, minus the food and the dream. Moving on, and we kind of pivot into the uh the technology that uh is impacting all of our lives, but also causing lots of concern.

Smart Glasses Privacy Hits A Wall

SPEAKER_01 55:51

We've touched upon the uh smart glass situation, and that situation has got a little worse uh rather than a little better. Uh, we are at that uh Google Glass moment uh where there's been a lot of fallout from Meta being caught having to start charge subscriptions for certain services on these glasses. So these cheap glasses that were going to be able to do everything for you suddenly comes with a $19 a month subscription for you to use some of the features. There's been a bit of a backlash to that. One can say there's also been a little bit of a backlash to finding out that Meta has uh had problems uh regarding the uh private and security elements of this. Uh we were talking last about certain pieces of information software and pictures being looked at by a contractor that many people were unhappy about, and then we wake up to the news that Meta were forced uh to do a mandatory software update to address a problem that a journalist had found where there seems to be a dark web of uh groups of modders drilling out the little light that tells uh uh individuals that the glasses are recording or capturing pictures, uh, and that the you know now they've had to put a piece of software in that says that your camera will stop working if this light is being disabled or covered up. This is not looking good. It's you know, we underneath the surface as well, we are now finding out that certain um uh legal operations, certain uh entertainment facilities, uh certain um courtrooms and legal offices are now banning uh uh wearers of these glasses or uh banning the wearing of these glasses on property for uh various uh issues regarding uh confidentiality and also concerns of privacy. When you start having to do this, it's not as seamless as treating these as a smartphone. And it's getting very close to a tipping point that we saw you know over 10 years ago with what happened with Google Glass. There, you know, it was the glass hole moment, now it's the Zuckberg moment, where I think even how cheaply subsidized these glasses are, if there is a public backlash against uh the feeling of privacy from them, then we could see the schlockware scenario befalling this. And you know, this could be quite considerable.

SPEAKER_00 58:43

Yeah, this whole thing is just uh, you know, do we need these? Do we need these in the market? I mean, I don't know, right? I mean, it looks like people are obviously wanting to use them. They're wanting to use them nefariously, potentially, or at least trying to circumvent some of the protections that Meta's tried to put in place to even allow them on the market in the first place. But then I think the real just kick in the balls, so to speak, for the consumers who have purchased these is then adding on that $20 a month subscription to what is presumably their killer app. And so you need uh, we talked about what is the killer app for these glasses, what is the killer app for these on the consumer standpoint, for the on a location-based entertainment standpoint. And they found one and now they decided to charge for it. And instead of just saying, hey, this is going to be the killer app that drives the sale of these glasses, which then tells me that obviously they are taking the glasses as a loss leader, looking to have that subscription fee really be their revenue model going forward. It's the consoles and the video game market, it's the uh printers and the printer uh cartridge market. It is the same thing. You're gonna sell the glasses for a loss or at cost, and then try to suck money out of the buyers through a subscription base.

SPEAKER_01 59:58

And and these whales, these buyers, sometimes rebel against that type of thing.

Sony Backlash Over Digital-Only Future

SPEAKER_01 1:00:04

Um, let me spin this in an opposite direction. We have seen the audience rebel to being treated as mugs. You know, uh, we're going to squeeze money out of you for the killer app with a subscription. We're going to take away uh your ability to uh have uh ownership of the uh contents that you buy. Sony are having their cracker barrel moment here. They've got a lot of angry people out there that just do not like the announcement that Sony made that they're going to be in two years' time taking away physical media uh needs from their console. So the machine that you will be purchasing, if you are purchasing in the future, will be a constantly online, connected, cloud-based uh gaming machine. And uh you won't really, you'll have to trust Sony that they're going to keep giving you access to the games that you paid. And how this kind of impacts us in the outer home entertainment market is that most players know that they're coming in to play a game that they are not buying, they're playing, buying time on to enjoy. They are pay-to-play, as it were. When you start to see the consumer games industry try and pivot towards our kind of model, we are going to have a conflict of interesting proportions in five years' time. But dealing with the audience now, they're not happy. They have been lumbasting Sony, tons of memes, tons of hate, and even and we've got that McDonald's moment. We've even got other brands taking the mick. And you know, when Domino says that they're now not going to be selling physical pizzas, they're only going to be selling digital pizzas. You know, hey, the guys, you've made a mistake. Now, will Sony have the cohooners to say, we were wrong, we've listened to the audience, and we're going to roll this back, and we will be continuing physical media, isn't a get out of jail card. This isn't like crack a barrel changing back to their original uh IP and hoping that everybody stops shouting at them. This could mean that a lot of companies turn around and go, we know what Sony really wants to do, and this is just a band-aid on a broken leg. We know that in 24 months or more, they will be removing uh physical media, and we don't want anything to do with this. One of the black eyes that Sony suffered with this announcement, they didn't tell any of their game developers that they were going to be making this announcement to remove uh physical uh media in uh uh 24 months' time. And this really did hurt the relationship when game developers are really feeling not loved under the current conditions in the consumer game sector. And remember, only a matter of months ago, I was reporting in Sound Off that the Sony CEO had jumped up on stage and said that the interactive entertainment sector of their business represented 60% of their total revenue. Well, someone's just urinated that up against the wall.

SPEAKER_00 1:03:20

Yeah, absolutely. Well, one of the major issues with this type of change is something that Nintendo had to learn uh over and over again until they finally uh they finally grasped it, which is reverse compatibility. So if I buy the new console that doesn't have a CD slot, then all of the games I've already purchased will not work. I just might as well throw them in the trash or now I have to maintain my PS5 in order to be able to uh continue to play those games while also trying to move on to the new console. And so this is something that is, while you know they're making the announcement now, wouldn't be surprised if they are already fully underway in RD development for their new console that will not have a physical media slot. And I think that will be a significant issue. Um, I do appreciate though the humor that other brands have had. Domino's, for example, like you put there the example. Uh, for those who are listening and maybe can't read it, Domino's has made the official statement that they're moving away from physical pizzas and they will now be only providing downloadable digital pizzas that you can use your imagination to enjoy. So, anyway, uh, you know, great humor and uh, you know, love when brands like that really dive into the fray and uh and have fun.

SPEAKER_01 1:04:32

Yeah, it's always nice to watch them do that. The McDonald's moment we were talking about earlier in the year. Uh, I'm sure we'll see it's a lot more. A corporation that has a consult and makes a statement that throws the gaming community that they've been building all this time up in uproar.

Xbox Cuts And The Cloud Endgame

SPEAKER_01 1:04:53

Reminds me of Xbox. And Xbox has recently been making their uh announcements. Their new CEO of the Xbox Division has actually started the process of uh cutting back on the staff. We've seen 4,000 plus individuals losing their jobs, mainly from the Xbox division and studios. Uh, and we now found out that you know the grand total is expected to be about 9,000 by the end of the year. We are also now seeing the company admitting that they're pivoting away from physical consoles towards uh um a cloud-based uh game economy. All of these guys are doing it, they all want to have games, uh, games as a service. They just want that recurring revenue. And if Sony's going to do it and Microsoft's going to do it, then I am sure Nintendo is going to do it. They will do lip service, they will make available a peripheral. For all they may release a tentative number of physical copies, but this is the future that we're now looking at in the consumer sector. We in the location-based entertainment industry need to position ourselves against this. We uh you know, we need to make sure that we are squeaky clean and seen as having a closer relationship with our audience rather than looking at them as cash cows.

SPEAKER_00 1:06:28

Indeed. Yeah, it'll be interesting to see how this shakes out across all the different console makers going forward.

SPEAKER_01 1:06:34

The this is the uh Anna Holebus for the video game consumer video games industry. Uh they're going to be spending a lot of money trying to renegotiate their relationship with their audience. We need to be prepared to do the same in our sector, especially when we've created some black-eye moments uh of our own. It's a come to Jesus moment for generations of interactive players, and we're in a very interesting position because of the relationship that we have with our players on two levels, not just the nostalgia, but also the new generation of players coming to our facilities.

Amusement 360 Invite And Wrap

SPEAKER_01 1:07:13

Anyway, uh just to wind up, um, we have in a matter of weeks' time, uh, we'll be heading into August. Oh dear, and uh in August we have Amusement 360 in Indianapolis. I will be uh presenting there on social entertainment uh and uh looking at how to create the right mix for competitive socializing and social entertainment in existing and new facilities. If you're if you've never attended Amusement 360 and you're an operator uh or a developer or even an in uh an investor in the uh location-based entertainment market, then you're missing out on a valuable opportunity, a boot camp to gain knowledge of the opportunities in the markets, the trends, and how to embrace those. It is uh also a valuable opportunity to do some visits, site visits to facilities, and to get a look under the hood regarding how uh you know how our industry works from an operator, FEC, laser tag, bowling, amusement, and competitive socializing perspective. Anyway, there is a lovely big QR code there for anyone that uh wants to add their name to the roster of attendees. Another QR code there for all of you that want to hit us up on LinkedIn or to use the email to pass on information. And I thank those that have passed on uh some info that I am currently researching at the moment that will have a big part to play in our next uh sound off. And uh, we are lucky enough to have some more uh uh stinger reports out in out there for you to read. Please keep up to date with that. Please make sure that if you've subscribed, that they are turning up in your inbox. Anyway, anyway, anyway, that's it from me.

SPEAKER_00 1:09:11

All right. Well, thank you, Kevin, for a great sound off, and we will see you on the next one. Have a good one.