When ATT is Done Paying Off Their Debt: Is Acquiring Dave Busters the Right Move?

Many have suggested that when ATT has finally paid off its debt, it should consider acquiring Dave Busters in order to enter the arcade business. This proposal is often made with the intention of giving Warner Media an alternative entertainment option, especially since it lacks its own US Warner Bros theme parks. However, the viability and wisdom of such a move need to be critically examined.

The Arcane Decline of the Arcade Business

The concept of arcades as a mainstream entertainment option for adults has largely waned over the past two decades, with most arcades either closing or dramatically downsizing. This is due to a combination of factors, including the rise of video games at home, the decline of family game time, and the economic shifts that have made arcades less appealing.

According to industry experts, the idea of a dedicated "playground" for adults, reminiscent of such settings as GAMEWORKS (formerly part of Dreamworks Entertainment) and Disney Quest, has struggled to gain traction, particularly in the United States. The vision of an arcade as a unique and profitable business seems anachronistic in the modern era.

Historical Context and Contrasts with Asian Markets

While casinos and entertainment venues in the United States have historically focused on family-oriented attractions, the arcades in Japan and parts of Asia have taken a different, more adult-oriented approach. These markets have seen significant growth, with numerous reliable and well-known arcade chains that continue to thrive. However, the arcades in the US have struggled to replicate this success.

For instance, in Japan, the arcades remain bustling with a diverse range of gaming, food, and social activities, catering to a wide audience, including adults. In contrast, the US arcade market has nearly collapsed, with many locations closing or significantly decreasing in size and scope. As of the latest count, there are fewer than 150 Dave Busters or GAMEWORKS stores in the entire United States, which is a stark contrast to the numerous similar establishments found in Tokyo alone.

Why Other Acquisitions Might Be More Viable

Given the declining arcades market, it may be more strategic for ATT to consider acquiring other entertainment companies. For example, acquiring BBC or a part of CBS Viacom could be a more promising venture, as these media giants have the potential to integrate into the current media landscape and offer diverse content and services.

Similarly, Take-Two Interactive, a leader in the gaming industry, could also be a better fit for ATT. With its vast catalog of popular games and potential for collaboration with Warner Media, Take-Two Interactive could offer a more robust and forward-looking business strategy.

Conclusion

While the idea of acquiring Dave Busters seems appealing on the surface, it is important to consider the current market dynamics and the long-term viability of the arcade business. ATT and Warner Media would be wise to explore other strategic acquisitions that align better with current consumer trends and industry developments.