Real Gamers Insert Coins…

A brief history of arcade games through the last five decades

Play Video

If you’re a child of the 70’s, 80’s or even the 90’s, you probably remember the time you spent in arcades very fondly.

A popular hangout for children and teenagers, the arcade was somewhere you could go to escape your parents and hang out somewhere that didn’t cost a lot of money (if you didn’t want it to).

Arcades were dingy, dark, often smoky and had no food or drink available apart from what was in the vending machine parked in a corner somewhere.

Arcade games usually are coin operated and have short levels with rapidly increasing difficulty and simple control movements, making them easy to master but hard to conquer.

You can only play the game for as long as you can stay ‘alive’ before having to put in more money in and start again. A simple concept that hooked many into obsessing over it.

Arcades got their start as early as the late 1930s with the first coin operated pinball machines bursting onto the scene. As the years went by, arcade games became better and much more fun, and by the late 60’s, really started to take off.

The ‘70s and ’80s brought us some of the most memorable video games in history, such as Space Invaders, Pac-Man, Galaga and Frogger.

But what happened to these pop culture icons that at one point, took over our lives? Well they may just be making a comeback….

The Early history (1971 – 1977)

The early ‘70s saw the creation of the multi-billion dollar worldwide market for video games we have today.

It all started 1971 with the first coin operated arcade game of its kind, the “Galaxy Game”. It was first installed at Stanford University in California.

The game cost around $20,000 to build (which is well over $100,000 in today’s money), using a DEC PDP-11 computer and a vector display. The game cost 10 cents to play, or for 25 cents you got three goes!

Only one unit was built initially, but in 1972, seven consoles were added, allowing gamers to play against each other.

But only a few months after the release of the “Galaxy Game” in 1971 came “Computer Space” which was developed by Nolan Bushnell and Ted Dabney.

The rights for this game were snapped up by Nutting Associates, who went on to manufacture over 1,500 units and even though it was an unsuccessful venture, it became a landmark as the first ever commercially sold arcade game.

The “Computer Space” creators went on to start the renowned gaming company, Atari, Inc.

In 1972 they released “Pong”, a game that truly kickstarted the arcade industry as we know it. It featured 2D graphics and was based on a simple game of tennis, easy to understand and easy to sell.

Pong went on to be a great success for Atari, Inc. and by 1973, the company had filled over 2,500 orders, and in 1974 had sold more than 8,000 units.

By the end of 1974, there were more than fifteen companies producing arcade video games. What followed a quick rise to success was what is referred to as the ‘Golden Age’ of the arcade.

The Golden Age (1978 – 1986)

The Golden Age of arcade games was a time of technical breakthroughs, massive creativity and game design that was spot on.

It was kicked off in 1978 by the release of “Space Invaders”, which went on to become one of the most popular arcade games of all time.

During this time, arcades and game rooms rapidly popped up in locations across America, Europe and Japan.

Arcade games were also being placed in supermarkets, restaurants, bars, pubs, liquor stores, gas stations, bowling alleys storefronts and many other retail establishments looking to attract more customers and extra income.

The two most successful arcade game companies of this era were Namco (the Japanese company that created Pac-Man, Pole Position, and Dig Dug) and of course, Atari, who continued to go from strength to strength.  They battled for the top spot against Sega, Nintendo, Capcom, Konami, Taito and Williams (just to name a few).

In 1980 came the legendary arcade game that changed the pop culture landscape forever… Pac-Man.

Pac-Man was a refreshing change from space shooter games such as “Space Invaders”, “Defender”, or “Asteroids, and brought a sense of humour to gaming. It appealed to a much wider market than just teenage boys and females began to flock to the arcades.

Like shopping malls and roller skating rinks, arcades were safe, isolated areas where kids and teenagers could hang out, spending hours without their parents, or much money!

We were also seeing massive improvements in the display monitors and the control systems of games started incorporating more than just joysticks and buttons. Pedals, steering wheels and ride-on motorcycles made their arcade debut!

In 1982, Time magazine released a story on arcades, stating the most popular machines in America were pulling in $400 a week in quarters and the number of arcades was at about 13,000!

Post-golden Age (1987 – present)

Towards the end of the Golden Age, American chains like Chuck E. Cheese’s and Dave and Busters began to crop up across the country.

They combined the traditional bar and restaurant environment with arcade games, creating the family orientated out-of-home entertainment industry that continues to grow and be hugely successful today!

Towards the end of the ‘80s, the popularity of arcades began to dwindle. But arcades weren’t done yet…

In March of 1991, Capcom released Street Fighter II, setting off a resurgence within the arcade industry. More than 60,000 units were sold worldwide, which was unheard of in the early ‘90s.

Even though Street Fighter II was released as home computer version, the technology was weak. To get the full Street Fighter II experience, you had to be in an arcade. Many believe this is still true today!

Because of the success of Street Fighter and its competitive nature, many more popular fighting games emerged like Mortal Kombat, King of Fighters, Virtua Fighter, and Killer Instinct.

Riding off the back of this success, we were re-introduced to driving games like Ridge Racer and Daytona USA, as well as shooting games like Time Crisis and Virtua Cop.

But gaming companies began to realise they were caught between a rock and a hard place. If the games were easy to learn, the more people were able to play them. If a game was too intimidating, it put casual gamers off.

But the hardcore gamers that were the ones spending most of the money and time in arcades, mastered them too quickly and therefore, stopped putting coins in the machines. This dilemma was never solved and potentially led to the major decline in arcades worldwide.

Although the gaming industry has changed vastly with the introduction of in-home gaming consoles, arcade games still hold a place in the market… and in our hearts!  

But now the popular arcade games include simulators and virtual reality, reigniting interest in arcade gaming once more.

Die-hard arcade fans and collectors can’t get enough of the classics that also trigger major nostalgia with the rest of us!

Whether it is as an investment, something to play with your mates or quality time spent with your kids, buying an arcade machine is a must!

This weekend brings an exciting opportunity for Lloyds Auctions, and for amusement machine enthusiasts, as we look to have one of our biggest arcade machine auctions yet!

The Pinball, Arcade & Amusement Game Extravaganza auction is for collectors, investors or gamers and for the young or the young at heart. ️

Come down to 69 Manchester Rd, Carrara QLD, this Saturday morning and travel back in time! Have a play on these vintage machines yourself and see some incredible classic cars and grab a BBQ sausage while you’re at it!

Don’t let this be Game Over. Pop your email address below and we will keep you up to date with all our old school auctions!

Matt Kalinski

Head Of Valuations

Qualifications & Affiliations

American Society of Appraisers Candidate Member

Certified Practicing Valuer AVAA


Matt has been in the valuations space for many years and has extensive experience in the space across an abundance of various industries. He now leads the valuations teams for Lloyds Auctions with a passion for encouraging his team to set and achieve high goals and produce great results for the company whilst growing the team’s skills starting with a great culture and team mindset.