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Population 313m Under 15 62.9m Aged 15-64 209.2m Urban population 82 percent Major cities Nine over 1m, a further 24 over 500,000 GDP per capita $47,200 Business climate As we went to press in August 2011, the sensational downgrading of the U.S. credit rating by Standard & Poor’s had dealt a body blow to the country’s economic credibility. Yet it remains a huge, business- oriented and employer-friendly market. Possible issues facing those setting up in business here include a sizeable wealth gap between affluent and less-affluent consumers, with incomes remaining flat at the lower end; an ageing population with growing healthcare and pension costs; significant variations among states in the regulatory framework; and social conservatism in some areas that may affect those local markets’ attitudes toward amusements. There are also exceptionally high levels of violent crime, by the standards of industrialised nations, in a few localities, but – perhaps contrary to the popular view – many more are quite unaffected by this.

When coin-operated amusements first appeared during the 1930s Great Depression, early operators and manufacturers envisioned a profitable, recession-proof industry. For decades, the creativity and ingenuity of the American manufacturers and operators drove the thriving sector nationwide. But serious challenges have confronted the industry since the early 1960s and 1970s, as urban neighborhoods’ deterioration eroded the player base. The boom in video games of the late 1970s introduced tough new laws and taxes, and the 1980s move toward home video games proved competitive with street locations. Societal and cultural changes during the 1990s increased

parents’ reluctance to allow their children out as often. And the first decade of the 21st century introduced individualised technology, inviting consumers to customise their amusement options on personal computers and phones. This evolving culture, ever-changing technology, and

competition for leisure activities have impacted every operation across the U.S., even closing down many. Laws impacting operators, both positive and negative, have passed individual state and local legislatures. Since 2008, the American recession has devastated the

economy. Reflecting that consumer caution, the U.S. Bureau of Labor Statistics reported a five percent drop in entertainment spending in 2009, the most recent year for which reporting is available. Yet smart, innovative operators have survived and even profited

by diversifying and promoting new ways to attract and retain customers. They have adapted by recognising one premise: everything is constantly changing and nothing is certain at all. Ironically, the smallest equipment categories have often

experienced the least decline in revenues. One may conclude that these speciality games have a loyal, if limited, following which actively seeks them out.

Market size and structure In 2009, the U.S. amusements market as a whole had revenue of $5.3bn.


Pool and prize merchandising are the biggest single categories of amusement by revenue. Each November, Vending Times releases its Census of the

Industry analysis of the prior year’s sales. The latest 2010 coin-op summary reported a decline of almost ten percent in 2009. The fragile American economy will probably lead to similar 2010 results. Calculating machine totals nationwide is difficult. Operators

often refuse to reveal their proprietary information. Also, numbers fluctuate because of location changes, damage, maintenance issues and licensing fees. Pool tables: In 2009, pool tables were the top amusement

game, accounting for 33 percent of all total game revenues and 25 percent of all installations. Unfortunately, however, the market for pool tables was largely based on taverns and bars, feeling the economic brunt of the recession and decreased customer traffic in 2009. Pool tables have been operator favourites since the 1950s

because of their longevity and easy maintenance. In recent years, electronically-controlled tables have become popular, increasing revenues by up to 25 percent. Total 2009 revenue from pool tables was $1.7bn from 290,000

tables, or $115 per table per week. Prize merchandisers: As more traditional locations rejected pinball and video games, the prize merchandiser category, mostly comprising skill cranes, has grown. It is now the second-biggest element of the amusements sector, accounting for 19 percent of all revenue. In 2009, total revenue was $980m from 124,000 machines, or

around $152 per machine per week. Jukeboxes: The original big-box machine has been downsized

to a smaller digital box that downloads music from a remote server. In a quality-versus-quantity environment, jukebox numbers have decreased. However, revenues have increased because of fewer low-income locations and more profitable sites. Almost half – 42 percent – of all jukeboxes were priced at $0.50 per play, or three plays for $1. Average weekly income was $138. Video games: Once accounting for the bulk (60 percent) of

operators’ income, video games hit their peak in 1982. Excluding some temporary rises in popularity and income, video games have steadily declined since the 1980s, currently accounting for 15 percent of total operating income. Many newer games like the Golden Tee golf product appeal to a more mature audience with competitive sports games, and have developed to include tournament play. Vending Times’s 2009 figures show video games generating

total revenue of just over $800m, from 308,000 units. That equates to an average weekly take of some $50. Pinball machines: Historically the operator’s most enduring

type of game, the pinball machine has declined by more than 70 percent in a decade. Several reasons have been cited, including space limitations and operator preferences for a computer-based game over the complex mechanical pinball. The flipper game was traditionally associated with taverns,

candy stores, and local restaurants. Because many of those locations have closed, pinball is now considered a niche game. In 2009, total revenue from pinball was $275m from 79,000 machines, or about $67 per machine per week. Electronic dart games: Electronic soft-tip dart games

continue to benefit from evolving technology. Dart games are staples throughout tavern locations in the U.S., but have the highest concentration in the Midwest, where the region’s economic hardship since 2008 resulted in an 11 percent overall revenue drop in 2009. In 2009, total revenue was $562m, from 148,000 machines: a weekly average of $73 per game.

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