| Are You Game?
Dedicated game rooms may be the next big thing for high-end customers. Jobs can range from simply adding gaming chairs to $150,000 integrations.
By Jason Knott
09/04 - What will be your integration company's biggest profit center in 2009? The answer to that question is likely found (or at least should be) in your long-range business plan. Evolution seems to be the name of the game in
terms of profit centers for dealers. Many have already evolved from non-installing stereo shops to home theater designers to whole-house systems integrators in the past 10 years. What's next?
The answer may lie in the demographics of the next generation of homebuyers and their electronic desires in the home. Industry watchers know that some of the predicted traits of the home of the future are always-on broadband
Internet connections, complete (hardwired or wireless) home networks, "smart" appliances, and the ability to download streaming media (music and movies) using a home media server. But some industry wags foresee active entertainment in the form of gaming as a
staple in the future.
In its ultimate form, that gaming desire could spur a virtual-reality room … much more than just home theater. It begs the question: Will home theaters be passe to the next generation of consumers who have grown up as "active"
game-players vs. "passive" movie-watchers/audio-listeners? Perhaps.
Savvy dealers are already preparing for this next generation by including gaming in their product mix. Just as in A/V or any other discipline, dealers need to accommodate various levels of gamers … from passionate, hard-core
fanatics who will spend money on a $100,000-plus dedicated game room to those who merely want to seamlessly connect their Xbox, PlayStation2 or GameCube to a home theater. Either way, offering gaming can be lucrative for dealers as the market grows. (See
sidebar below.) Other trends are also fueling the future need for home game rooms, including the growing establishment of public gaming facilities, online gaming, mobile gaming and more. (See sidebar below.)
What Is a Game Room?
To be clear, a dedicated game room is not the family home theater. It is something more ... a safe place for kids (and adults) to play their games while still within the confines of the home and close to the family. A dedicated game room will have individual
gaming stations, which are much like well-designed, ergonomic computer workstations, in addition to a large screen display with 5.1 surround sound for a group game experience.
Rich Green of Rich Green Ink, a Palo Alto, Calif.-based integrator who completed a $150,000 dedicated game room for one of his clients in 2002, calls it the "lean-forward, 2-foot media experience" vs. the "lean back, 10-foot
media experience" with which consumers are familiar when comparing their computing functions to TV-watching functions. "There needs to be at least two gaming stations, four is more fun," says Green.
Each station in the game room should accommodate games for X-Box, Playstation2 and PC. Nintendo GameCube is also viable. "Hardcore gamers do their serious gaming on PCs, using the most extreme PC technology their money can
buy," adds Green.
Ergonomics is a key factor in the design of a game room. Kids will often play for more than 12 hours at a stretch, and if the keyboard and mouse are not properly designed, that kind of extended, repetitive use can cause pain
and other physical problems. Beyond arm, hand, head, and body position, other design factors include screen size, viewing distance, sight lines to other screens within the room, competitive game configurations (e.g., one against three, two against two, four
against two), comfort (you need to move a lot of conditioned air in a small space to reduce claustrophobia and keep the temperature comfortable) and, of course, acoustics. Sound quality needs to be managed as skillfully as you would in a home theater, and
sound transmission to other rooms in the house must be minimized or "mom will start screaming," says Green. In multi-station rooms, switching becomes a serious challenge. An integrator must consider all forms of video, digital audio and analog audio in a
cross-point matrix configuration. Displays have to be just right, and of the highest performance with respect to LCD response time.
The dedicated room that Green constructed has five separate audio systems, plus it gives users the ability to wear headsets with microphones. Headsets are a key element to a game room. If gamers are competing against each other
in the same room, an integrator might need to configure the headsets so team "allies" can communicate with each other while their "enemies" cannot hear. That switching can be handled via VoIP.
Regarding audio, each gaming station has its own 2.1 channel system. Moreover, the entire room has a 5.1 surround sound system and subwoofer for use with a 42-inch plasma.
"Subwoofers are extremely important for gaming fun. They really ratchet up the emotion," says Green.
Communications are a challenge as well. All gaming platforms require high-speed Internet connectivity. The network has to be managed with DMZ (demilitarized zone or an area outside a firewall) port access, which means that the
game network will be partitioned from the rest of the house because a firewall will get in the way of game access and flow. T-1 Internet service for the game room is not out of the question. Green calls it the Massively Multiplayer Online Role Playing Games
(MMORPG) phenomenon.
Lighting is just as important for games as it is for high-end home theater. Green recommends using a gentle, color-neutral backlight behind the monitor so the users don't get "hot spots" in their vision from sitting in a dark
room with all the lights out except for a 20-inch illuminated panel. "That can be very fatiguing. You also want to have task lighting on the keyboard and mouse area so the gamer can see the keys without squinting," adds Green. "We don't use anything fancy ...
just pinpoint halogen spotlights."
Gaming Market Numbers Are Mind-Blowing
Video gaming is not just for penniless, pimply-faced geeks living with their parents anymore. Putting an exact market size on the video game console and PC market is difficult. One researcher, InStat MDR, estimates the 2004 console-only sales revenue at $2.3
billion. Another firm, The NPD Group, tabs the console and gaming PC equipment revenues at $4.2 billion this year. Jupiter Research is much more bullish, citing online gaming as a driving force. It estimates overall gaming equipment revenues for 2004 will be
$11.6 billion, with nearly two-thirds coming from consoles ($8.4 billion) and the rest from PCs dedicated to gaming in the home ($3.2 billion). Jupiter estimates the overall market to reach $14.7 billion by 2007.
One thing is for sure, annual equipment sales ebb corresponding to the introduction of new consoles. For example, the debut of Sony's PlayStation3 in 2005 is expected to boost sales next year. However, there were no new console
introductions by Sony, Microsoft or Nintendo in 2003 or 2004, which resulted in a 2.7 percent sales decline, according to The NPD Group.
The buying demographic is becoming more attractive for dealers also. In 2003, the average video game player was 29 years old, not too far from the age where consumers start buying houses. (According to the National Association
of Realtors, a typical first-time homebuyer is 32 years old.)
OK, we've established that the market is sizable, but what's in it for integrators? You are certainly not going to make money selling $150 consoles or game software (which ranges from $15 used to $60 new). Similar to the trend
in flat-panel televisions, the money is predicted to come from integration of the gaming equipment into home video and audio systems.
According to the Consumer Electronics Association (CEA), 38 percent of U.S. homes in 2002 had gaming systems. That figure is estimated to be 50 percent today, and an estimated 30 percent of those homes will have at least two
consoles. Meanwhile, nearly half of homeowners with PC networks (44 percent) cite gaming as a primary or secondary reason that they had a network installed.
"The market is wealthy people," says Green, adding that families with youngsters and teenagers already addicted to gaming are an added bonus. Green advises dealers to forget about trying to make product margins on consoles and
don't even try to offer game software. "So why should a dealer bother?" he asks rhetorically. "The answer is that you can wrap a $150,000 room around those things. It's all about the room … the design, ergonomics, complexity of switching, etc. Those are all
the things that integrators are uniquely qualified to do. We charge a lot of money for it because it is difficult. I consider this THE most difficult design challenge we have in our industry."
Green should know. His $150,000, 100-square-foot dedicated gaming room job was two years in the making. A previous A/V contractor in the area rejected the client's request to design and install a dedicated game room, saying
that "they don't do game rooms," according to Green, (even though the rest of the home has a magnificent A/V and whole-house control system.) The room accommodates four seated gamers along with two to four onlookers behind them. He estimates that 40 percent of
the budget was for design and installation.
"When the clients moved into their glorious new house, they found themselves huddled in our little game room most of the time," says Green. "And they were loving it." He adds that the client asked, "Gosh, why doesn't everyone
have one of these?"
Where Do You Start?
There are several levels at which an integrator can "play" in the gaming space. For dealers without showrooms, the entrйe into the gaming space is more difficult. But for integrators with showrooms, stage one is basic. For most, it involves merely connecting a
gaming console (Xbox or PlayStation) to an existing home theater area in their showroom.
"If you put an Xbox on the sales floor hooked into one of your demo theaters, the kids will be lining up on Saturday mornings to get in there to play. That's a shoo-in," Green says confidently.
The next level of gaming marketing is to create a private gaming room in your facility that looks like a business work center with PCs, gaming consoles, multimedia speakers and 20-inch LCDs.
The ultimate dive into game-room sales would be to also devote a portion of your showroom to "stand-up-and-fight" type of games where users swing golf clubs or baseball bats, shoot electronic rifles or handguns, or thrust and
parry swords. Those types of dedicated game rooms require a design with open floor space in the center, high ceilings, a large open wall and about 100 square feet. Typically, there is little to no furniture in the room.
David Gormley, president of Adtech Systems Inc. in Wayland, Mass., is one dealer who has taken the plunge, and hopes to use the gaming area to guide customers into custom installation. He spent six months and $300,000
remodeling a 1699 historic house in nearby Sudbury and filling it with $1 million worth of consumer electronics to create a very unique retail custom electronics showroom.
The upstairs of his 12,000-square-foot Home Entertainment Expo facility is a boutique-style showroom with 10 separate vignettes, including a retail-style display that includes gaming consoles. But downstairs is where the fun
begins, with four separate projector setups for do-it-yourselfers, including one room (about 8-feet by 10-feet in size) with a LaserShot target practice game. The idea is to guide customers from these rooms to the custom areas.
Gormley admits it's risky. "The challenge is that there is a percentage of customers who have no intention of buying from us; they are just looking to see the projector demonstrations. That will waste my sales staff's time. The
hope is that they will see our professionalism and decide it's worth paying more money to buy from us," he says.
Gaming Arcades Fuel the Market
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Remember as a kid when you went to the local penny arcade ... foosball, skeeball and pinball machines. Those arcades morphed to later include Pac-Man, Space Invaders and Centipede. Today's video arcades have evolved into competitive gaming facilities where
gamers not only compete against the machines, but against other gamers in the arcade and across the world online. The new moniker for the locations is multiplayer gaming facilities.
Dylan Schissler is the owner of Digital Ops, a gaming center in Ann Arbor, Mich. The small 650-square-foot location has 16 to 18 stations, based on the game configuration. Each station has joysticks, steering wheels and other necessary hardware to play
competitive games, both online and against other gamers in the facility.
"We cater to middle-school kids, but not just nerdy kids," says Schissler, who has home technologies in his blood as the son of industry training guru Helen Heneveld. Digital Ops is open from noon to midnight seven days a week
and charges $5 per hour to gamers, or $20 for the entire day. The location holds tournaments for particular games that require separate entry fees.
"Many of these kids hold LAN parties at their own homes, where four to 40 of them get together at someone's house, network their laptop computers and play competitive games all night. We even rent out our location for an entire
weekend," Schissler adds. At Digital Ops, any game station can voice conference with another. Users can play games in different configurations, like six-on-three, or four-on-two.
Rich Green of Rich Green Ink in Palo Alto, Calif., believes these gaming centers are a potentially valuable source of future business for dealers.
"If I were a dealer and I had a gaming arcade close to me, I would do some cross-marketing with the owners of the gaming arcades," he recommends. "The [players] are usually kids in their twenties with business degrees. I would
design and build an all-out fantasy game space in the back of my showroom and charge a premium to use it. I guarantee that parents would ask how they can create a game room in their own home." Green says during the recent CEDIA Regional in Calgary, he visited
a 40-station gaming center filled with "lots of polite, clean-cut teenagers" and "off-duty cops." He adds, "I bet those cops have families!"
Online Games: The Next Driver
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As gaming moves from arcades to the home, it is also moving into cyberspace. Online game sales and subscription revenue is projected to triple to $1.1 billion by 2008, fueled by new devices and falling console prices. According to a report from the Yankee
Group, the online gaming industry generates $353 million in direct sales and subscription revenue. The firm predicts that video game consoles will drop in price to between $49 and $79 in the next several years.
Hitachi is one company sold on the future of online gaming. The company recently announced that it has signed on as a worldwide sponsor of the Cyberathlete Professional League (CPL), a professional gaming league. Hitachi is providing $100,000 in cash prizes to
the league. The markets have legions of devoted fans. Everquest, a game that creates a virtual reality world of alter egos, has more than 400,000 subscribers, according to the International Game Developers Association. Gaming competitions are big Super
Bowl-style events in Asia. Meanwhile, PC makers are targeting the market with a new generation of high-performance computers for gaming. These units include state-of-the-art processors, expensive graphics and sound cards, extra power supplies, and cooling
systems to prevent overheating.
According to a report from Reuters news service, Dell, Hewlett Packard and lesser-known specialists Shuttle, VoodooPC, Alienware and Falcon Northwest are unveiling gaming PCs with price tags between $2,000 and $5,000.
Related:
www.alienware.com
www.falcon-nw.com
www.hitachigst.com
www.igda.org
www.shuttle.com
www.thecpl.com
www.voodoopc.com
Gaming Room Ingredients
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When Rich Green Ink installed a $150,000 dedicated gaming room for a client two years ago, he integrated home theater components with gaming equipment.
1 AMX NI-2000 integrated control system
1 Autopatch Precis 12x8 matrix A/V switcher
4 custom game PC P4 3.2GHz processors
1 custom game server P4 2.8GHz processor
4 Dell 2001FP 20-inch LCD video monitors
1 Fujitsu P42HHA30WS 42-inch plasma display
5 Gallo Acoustics Nucleus Due mini speakers
1 HP ProCurve 2524 24-port fast Ethernet switch
1 Integra DTR-6.4 A/V receiver
7 Mad Catz wireless controller game controllers
4 Microsoft Xbox gaming consoles
4 Middle Atlantic SRSR4 slide/swivel rack systems
3 Monster HTS2000 power centers
1 Monster HTS5100 power center
4 Sony Playstation 2 gaming consoles
2 Triad InWall Bronze/6 power subs
1 Vogels EFW2010 plasma swing-out bracket
4 XHiFi XDucer 2.1 powered mini speakers
Scotty ... I Need More Power
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If your clients ever wanted to be Captain James T. Kirk of the Starship Enterprise, here's your chance fulfill their dreams. A single gaming chair can be an alternative to hooking up a video gaming console to a client's home theater or dedicating an entire
room to virtual gaming. That's right, a single, far-out, sci-fi-inspired chair that would even humble William Shatner.
One chair-the GameDeck Mayfly machine-can be configured into a flight simulation mode (yoke and rudders) or a driving mode (steering wheel and pedals) with an LCD screen. The unit starts at $995 before upgrades.
The GameDeck Navis chair starts at $4,395. Among its features are tilting seat, swinging console, built-in VGA cable and USB extension cables, leather upholstery, and speaker brackets for 5.1 surround sound.
Gaming centers like Digital Ops advertise for patrons to come in and use the chairs, with the "first half-hour free."
Related:
www.gamedeck.com
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