Over the last couple of years, we've seen a plethora of news articles about how virtual reality was about to save the timeless arcade. The theory goes that the VR gear is too expensive for home users, therefore it creates an opportunity for operators to pony up the big bucks to purchase it and make their money back by charging a match to play it. Much Nolan Bushnell, the inventor of Pong, is trying to hype the tech as the industry's savior. From the MIT Technology Review.
"While several high-end cans were released last year which may bring virtual-reality adventures to your living space, adoption of this technology remains in its earliest days to get a bunch of reasons--it's still bulky, pricey, and there is not all that much to do once you've got it on your face. More than two million cans were shipped worldwide in 2016, according to an estimate from market researcher Canalys, but this figure pales in comparison to the popularity of, say, video game consoles (earnings of their top one, Sony's PS4, topped six million during the 2016 holiday season ). Consumer virtual reality will probably catch on as costs come down and headsets improve. In the meantime, though, a number of companies are betting that customers may be pleased to cover a much smaller sum to try the technology with their buddies at, say, an arcade, theme park, or even bowling alley."
It's tempting to dive into this trap, but in the operator's perspective VR is a terrible thing. Other than buying a brand new vehicle and driving it a mile, I can not think about a way that you could eliminate money quicker between what you pay and what you'll have the ability to get for it down the street.
Another limit for most operators is that while you may have the ability to supply a space for VR people to wander around in now, as fresh VR tech is unveiled, we are going to find the stage expanded from 100 square feet into the whole world. Instead of viewing just the games in your headset, you will realize the true world with game play overlayed. Kids can go to the park and relive the knights of the round table or parking garages to shoot aliens. As the tech allows more actual world areas to be researched, it is going to earn a cramped arcade seem pretty lame in comparison.
VR is heading for mass market acceptance, however it's demand is not being driven by gamers who wish to pay big buck to play video games, but like the BETAMAX that came before it, by individuals who wish to watch porn in their houses.
Even if an operator can make just a little bit of money for the next few decades, once VR achieves critical mass, it is going to crush whatever revenue stream that operators are dreaming of. Do not believe me? Just check out what's happening in China.
A year later 22,000 of them have closed.
That is an incredible failure rate over such a brief period of time and one which should function as a sharp warning to anyone contemplating investing in the VR games. Maybe Dave and Busters can afford to take losses over the games more than Chinese startup arcades, however I doubt that most North American operators will fare much better using the tech in their game rooms and will only wind up in debt in the end of the day.
The problem basically boils down to consumers not being prepared to pay a premium for the experience. Tech In Asia, describes the problem perfectly in their own article, on that the Chinese VR boom and bust.

"Enterprising store owners jumped into VR are finding it impossible to bill fees comparable to cinemas or bowling alleys to get a arcade.9d vr experience. One VR arcade proprietor told iHeima that he saw excited queues when charging US$1.50 to get a 30-minute session, but everyone vanished as it climbed to US$5. From that sort of revenue it's not possible to cover the lease."
Even if the game was sold out all day, at $1.50 a half hour they're just earning $30 a day.
The actual world data streaming in from China should function as a canary in the quarter plantations of North America. Operators who invest considerable amounts of money on fancy VR setups will soon find their small VR rooms being replaced by the entire world for a stage. Since the setups get cheaper, smaller and more portable, the digital arcades will seem more expensive, bulky and limited. I would like to be proven wrong on this one, but I think that the arcade VR fad is more hype than hope.