An arcade game or coin-op game is a coin-operated entertainment machine typically installed in public businesses such as restaurants, bars and amusement arcades. Most arcade games are video games, pinball machines, electro-mechanical games, redemption games or merchandisers. While exact dates are debated, the golden age of arcade video games is usually defined as a period beginning sometime in the late 1970s and ending sometime in the mid-1980s. Excluding a brief resurgence in the early 1990s, the arcade industry subsequently declined in the Western hemisphere as competing home video game consoles such as the Sony PlayStation and Microsoft Xbox increased in their graphics and game-play capability and decreased in cost. The Eastern hemisphere retains a strong arcade industry.^[47]

The first popular "arcade games" included early amusement-park midway games such as shooting galleries, ball-toss games, and the earliest coin-operated machines, such as those that claimed to tell a person's fortune or that played mechanical music. The old Midways of 1920s-era amusement parks (such as Coney Island in New York) provided the inspiration and atmosphere for later arcade games. In the 1930s the first coin-operated pinball machines emerged. These early amusement machines differed from their later electronic cousins in that they were made of wood. They lacked plungers or lit-up bonus surfaces on the playing field, and used mechanical instead of electronic scoring-readouts. By around 1977 most pinball machines in production switched to using solid-state electronics both for operation and for scoring.^[48]

Popularity of arcade machines came with contention through the mid 1970s and early 1980s. During the same period that video games proliferated and were celebrated as a sign of technological progress, numerous communities organized against arcades.^[49] Efforts to regulate coin op video gaming were geographically widespread, and they also drew on long standing suspicions of the coin-operated industry, which included organized crime and influence of violence. Existing regulation in several communities facilitated the ongoing regulation existed due to its associations to money laundering and organized criminal activity and its long standing cultural and historical ties with gambling.^[49] Despite the negative connotations of the coin operated industry in the preceding decades of the 1960s and the 1950s, by the 1970s, those in the industry were working towards professionalization and acceptance as a legitimate business. Two major trade journals RePlay Magazine published in 1975 and Play Meter published in 1974 offered profiles on industry professional and updates on industry news that helped professionalize the industry.

In 1966 Sega introduced an electro-mechanical game called Periscope^[50] – an early submarine simulator and light gun shooter^[51] which used lights and plastic waves to simulate sinking ships from a submarine.^[52] It became an instant success in Japan, Europe, and North America,^[53] where it was the first arcade game to cost a quarter per play,^[50] which would remain the standard price for arcade games for many years to come.^[53] In 1967 Taito released an electro-mechanical arcade game of their own, Crown Soccer Special, a two-player sports game that simulated association football, using various electronic components, including electronic versions of pinball flippers.^[54]

Sega later produced gun games which resemble first-person shooter video games, but which were in fact electro-mechanical games that used rear image projection in a manner similar to the ancient zoetrope to produce moving animations on a screen.^[55] The first of these, the light-gun game Duck Hunt,^[56] appeared in 1969;^[57] it featured animated moving targets on a screen, printed out the player's score on a ticket, and had volume-controllable sound-effects.^[56] That same year, Sega released an electro-mechanical arcade racing game, Grand Prix, which had a first-person view, electronic sound, a dashboard with a racing wheel and accelerator,^[58] and a forward-scrolling road projected on a screen.^[59] Another Sega 1969 release, Missile, a shooter and vehicle-combat simulation, featured electronic sound and a moving film strip to represent the targets on a projection screen. It was the earliest known arcade game to feature a joystick with a fire button, which formed part of an early dual-control scheme, where two directional buttons are used to move the player's tank and a two-way joystick is used to shoot and steer the missile onto oncoming planes displayed on the screen; when a plane is hit, an animated explosion appears on screen, accompanied by the sound of an explosion.^[60] In 1970 Midway released the game in North America as S.A.M.I..^[60][61] In the same year, Sega released Jet Rocket, a combat flight-simulator featuring cockpit controls that could move the player aircraft around a landscape displayed on a screen and shoot missiles onto targets that explode when hit.^[62]

In the course of the 1970s, following the release of Pong in 1972, electronic video-games gradually replaced electro-mechanical arcade games.^[63] In 1972, Sega released an electro-mechanical game called Killer Shark, a first-person light-gun shooter known for appearing in the 1975 film Jaws.^[55] In 1974, Nintendo released Wild Gunman, a light-gun shooter that used full-motion video-projection from 16 mm film to display live-action cowboy opponents on the screen.^[64] One of the last successful electro-mechanical arcade games was F-1, a racing game developed by Namco and distributed by Atari in 1976;^[65] this game appeared in the films Dawn of the Dead (1978)^[66] and Midnight Madness (1980), as did Sega's Jet Rocket in the latter film. The 1978 video game Space Invaders, however, dealt a yet more powerful blow to the popularity of electro-mechanical games.^[67]

In 1971, students at Stanford University set up the Galaxy Game, a coin-operated version of the video game Spacewar. This ranks as the earliest known instance of a coin-operated video game. Later in the same year, Nolan Bushnell created the first mass-manufactured game, Computer Space, for Nutting Associates.

In 1972, Atari was formed by Nolan Bushnell and Ted Dabney. Atari essentially created the coin-operated video game industry with the game Pong, the first successful electronic ping pong video game. Pong proved to be popular, but imitators helped keep Atari from dominating the fledgling coin-operated video game market.

Taito's Space Invaders, in 1978, proved to be the first blockbuster arcade video game.^[68] Its success marked the beginning of the golden age of arcade video games. Video game arcades sprang up in shopping malls, and small "corner arcades" appeared in restaurants, grocery stores, bars and movie theaters all over the United States, Japan and other countries during the late 1970s and early 1980s. Space Invaders (1978), Galaxian (1979), Pac-Man (1980), Battlezone (1980), Defender (1980), and Bosconian (1981) were especially popular. By 1981, the arcade video game industry was worth US$8 billion^[69] ($22 billion in 2018).

During the late 1970s and 1980s, chains such as Chuck E. Cheese's, Ground Round, Dave and Busters, ShowBiz Pizza Place and Gatti's Pizza combined the traditional restaurant or bar environment with arcades.^[70] By the late 1980s, the arcade video game craze was beginning to fade due to advances in home video game console technology. By 1991, US arcade video game revenues had fallen to $2.1 billion.^[71]

Sega AM2's Hang-On, designed by Yu Suzuki and running on the Sega Space Harrier hardware, was the first of Sega's "Super Scaler" arcade system boards that allowed pseudo-3D sprite-scaling at high frame rates.^[72] The pseudo-3D sprite/tile scaling was handled in a similar manner to textures in later texture-mapped polygonal 3D games of the 1990s.^[73] Designed by Sega AM2's Yu Suzuki, he stated that his "designs were always 3D from the beginning. All the calculations in the system were 3D, even from Hang-On. I calculated the position, scale, and zoom rate in 3D and converted it backwards to 2D. So I was always thinking in 3D."^[74] It was controlled using a video game arcade cabinet resembling a motorbike, which the player moves with their body. This began the "Taikan" trend, the use of motion-controlled hydraulic arcade cabinets in many arcade games of the late 1980s, two decades before motion controls became popular on video game consoles.^[75]

Arcades experienced a major resurgence with the 1991 release of Capcom's Street Fighter II,^[76] which popularized competitive fighting games and revived the arcade industry to a level of popularity not seen since the days of Pac-Man,^[77] setting off a renaissance for the arcade game industry in the early 1990s.^[78] Its success led to a wave of other popular games which mostly were in the fighting genre, such as Pit-Fighter (1990) by Atari, Mortal Kombat by Midway Games,^[79] Fatal Fury: King of Fighters (1992) by SNK, Virtua Fighter (1993) by Sega, Killer Instinct (1994) by Rare, Tekken (1994) by Namco, and The King of Fighters (1994–2005) by SNK. In 1993, Electronic Games noted that when "historians look back at the world of coin-op during the early 1990s, one of the defining highlights of the video game art form will undoubtedly focus on fighting/martial arts themes" which it described as "the backbone of the industry" at the time.^[80]

3D polygon graphics were popularized by the Sega Model 1 games Virtua Racing (1992) and Virtua Fighter (1993),^[81] followed by racing games^[77] like the Namco System 22 title Ridge Racer (1993) and Sega Model 2 title Daytona USA, and light gun shooters like Sega's Virtua Cop (1994)^[82] and Mesa Logic's Area 51 (1995), gaining considerable popularity in the arcades.^[77] By 1994, arcade games in the United States were generating revenues of $7 billion^[83] in quarters (equivalent to $11.8 billion in 2018),^[84] in comparison to home console game sales of $6 billion,^[83] with many of the best-selling home video games in the early 1990s often being arcade ports.^[85] Combined, total US arcade and console game revenues of $13 billion in 1994 ($22 billion in 2018) was nearly two and a half times the $5 billion revenue grossed by movies in the United States at the time.^[83]

Around the mid-1990s, the fifth-generation home consoles, Sega Saturn, PlayStation, and Nintendo 64, began offering true 3D graphics, improved sound, and better 2D graphics, than the previous generation. By 1995, personal computers followed, with 3D accelerator cards. While arcade systems such as the Sega Model 3 remained considerably more advanced than home systems in the late 1990s,^[86][87] the technological advantage that arcade games had, in their ability to customize and use the latest graphics and sound chips, slowly began narrowing, and the convenience of home games eventually caused a decline in arcade gaming. Sega's sixth generation console, the Dreamcast, could produce 3D graphics comparable to the Sega NAOMI arcade system in 1998, after which Sega produced more powerful arcade systems such as the Sega NAOMI Multiboard and Sega Hikaru in 1999 and the Sega NAOMI 2 in 2000, before Sega eventually stopped manufacturing expensive proprietary arcade system boards, with their subsequent arcade boards being based on more affordable commercial console or PC components.

Arcade video games had declined in popularity so much by the late 1990s, that revenues in the United States dropped to US$1.33 billion in 1999,^[88] and reached a low of $866 million in 2004.^[89] The gap in release dates and quality between console ports and the arcade games they were ported from dramatically narrowed, thus setting up home consoles as a major competitor with arcades.^[90] Furthermore, by the early 2000s, networked gaming via computers and then consoles across the Internet had also appeared,^[91] replacing the venue of head-to-head competition and social atmosphere once provided solely by arcades.^[92]

The arcade market suffered from a lack of diversity even compared to other gaming markets (a 1996 survey showed that 70% of arcade players were teenage males), leading to a cycle in which the uniformity of the audience discouraged innovation in game design, which in turn further discouraged people outside the narrow target audience from visiting arcades.^[93] The arcades lost their status as the forefront of new game releases. Given the choice between playing a game at an arcade three or four times (perhaps 15 minutes of play for a typical arcade game), and renting, at about the same price, exactly the same game—for a video game console—the console became the preferred choice. Fighting games were the most attractive feature for arcades, since they offered the prospect of face-to-face competition and tournaments, which correspondingly led players to practice more (and spend more money in the arcade), but they could not support the business all by themselves.

To remain viable, arcades added other elements to complement the video games such as redemption games, merchandiser games, and food service, typically snacks and fast food. Referred to as "fun centers" or "family fun centers",^[94] some of the longstanding chains such as Chuck E. Cheese's and Gatti's Pizza ("GattiTowns")^[95] also changed to this format. Many 1980s-era video game arcades have long since closed, and classic coin-operated games have become largely the province of dedicated gamers and hobbyists. In the 2010s, some movie theaters and family fun centers still have small arcades.

In the 2000s and 2010s, arcades have found a niche market by providing games that use special controllers largely inaccessible to home users, such as dance games that have a floor that senses the user's dancing. An alternative interpretation (one that includes fighting games, which continue to thrive and require no special controller) is that the arcade is now a more socially-oriented hangout, with games that focus on an individual's performance, rather than the game's content, as the primary form of novelty. Examples of today's popular genres are rhythm games such as Dance Dance Revolution (1998) and DrumMania (1999), and rail shooters such as Virtua Cop (1994), Time Crisis (1995) and House of the Dead (1996). In the Western world, the arcade video game industry still exists, but in a greatly reduced form. Video arcade game hardware is often based on home game consoles to reduce development costs; there are video arcade versions of Dreamcast (NAOMI, Atomiswave), PlayStation 2 (System 246), Nintendo GameCube (Triforce), and Microsoft Xbox (Chihiro) home consoles and PC (e.g. Taito Type X). Some arcades have survived by expanding into ticket-based prize redemption and more physical games with no home console equivalent, such as skee ball and Whac-A-Mole. Some genres, particularly dancing and rhythm games (such as Konami's Dance Dance Revolution), continue to be popular in arcades.

Worldwide, arcade game revenues gradually increased from US$1.8 billion in 1998 to US$3.2 billion in 2002, rivalling PC game sales of US$3.2 billion that same year.^[96] In particular, arcade video games are a thriving industry in China, where arcades are widespread across the country.^[97] The US market has also experienced a slight resurgence, with the number of video game arcades across the nation increasing from 2,500 in 2003 to 3,500 in 2008, though this is significantly less than the 10,000 arcades in the early 1980s. As of 2009, a successful arcade game usually sells around 4000 to 6000 units worldwide.^[98]

The relative simplicity yet solid gameplay of many of these early games has inspired a new generation of fans who can play them on mobile phones or with emulators such as MAME. Some classic arcade games are reappearing in commercial settings, such as Namco's Ms. Pac-Man/Galaga: Class of 1981 two-in-one game,^[99] or integrated directly into controller hardware (joysticks) with replaceable flash drives storing game ROMs. Arcade classics have also been reappearing as mobile games, with Pac-Man in particular selling over 30 million downloads in the United States by 2010.^[100] Arcade classics have also begun to appear on multi-game arcade machines for home users.^[101]

In the Japanese gaming industry, arcades have remained popular through to the present day. Much of the consistent popularity and growing industry is due to several factors such as support for continued innovation and that developers of machines own the arcades. Additionally, Japan arcade machines are notably more unique as to US machines, where Japanese arcades can offer experiences that players could not get at home. This is constant throughout Japanese arcade history.^[102] As of 2009, out of Japan's US$20 billion gaming market, US$6 billion of that amount is generated from arcades, which represent the largest sector of the Japanese video game market, followed by home console games and mobile games at US$3.5 billion and US$2 billion, respectively.^[103] According to in 2005, arcade ownership and operation accounted for a majority of Namco's for example.^[104] With considerable withdrawal from the arcade market from companies such as Capcom, Sega became the strongest player in the arcade market with 60% marketshare in 2006.^[105] Despite the global decline of arcades, Japanese companies hit record revenue for three consecutive years during this period.^[106] However, due to the country's economic recession, the Japanese arcade industry has also been steadily declining, from ¥702.9 billion (US$8.7 billion) in 2007 to ¥504.3 billion (US$6.2 billion) in 2010.^[107] In 2013, estimation of revenue is ¥470 billion.^[107]

The layout of an arcade in Japan greatly differs from an arcade in America. The arcades of Japan are multi-floor complexes (often taking up entire buildings), split into sections by game types. On the ground level the arcade typically hosts physically demanding games that draw crowds of onlookers, like music rhythm games. Another floor is often a maze of multi-player games and battle simulators. These multi-player games often have online connectivity tracking rankings and reputation of each player; top players are revered and respected in arcades. The top floor of the arcade is typically for rewards where Players can trade credits or tickets for prizes.^[108]

In the Japanese market, network and card features introduced by Virtua Fighter 4 and World Club Champion Football, and novelty cabinets such as Gundam Pod machines have caused revitalizations in arcade profitability in Japan. The reason for the continued popularity of arcades in comparison to the west, are heavy population density and an infrastructure similar to casino facilities.

Former rivals in the Japanese arcade industry, Konami, Taito, Bandai Namco Entertainment and Sega, are now working together to keep the arcade industry vibrant. This is evidenced in the sharing of arcade networks, and venues having games from all major companies rather than only games from their own company.^[109]

Virtually all modern arcade games (other than the very traditional Midway-type games at county fairs) make extensive use of solid state electronics, integrated circuits and cathode-ray tube screens. In the past, coin-operated arcade video games generally used custom per-game hardware often with multiple CPUs, highly specialized sound and graphics chips, and the latest in expensive computer graphics display technology. This allowed arcade system boards to produce more complex graphics and sound than what was then possible on video game consoles or personal computers, which is no longer the case in the 2010s. Arcade game hardware in the 2010s is often based on modified video game console hardware or high-end PC components. Arcade games frequently have more immersive and realistic game controls than either PC or console games, including specialized ambiance or control accessories: fully enclosed dynamic cabinets with force feedback controls, dedicated lightguns, rear-projection displays, reproductions of automobile or airplane cockpits, motorcycle or horse-shaped controllers, or highly dedicated controllers such as dancing mats and fishing rods. These accessories are usually what set modern video games apart from other games, as they are usually too bulky, expensive, and specialized to be used with typical home PCs and consoles. Currently with the advent of Virtual reality, arcade makers have begun to experiment with Virtual reality technology. Arcades have also progressed from using coin as credits to operate machines to cards that hold the virtual currency of credits.

Arcade games often have short levels, simple and intuitive control schemes, and rapidly increasing difficulty. This is due to the environment of the Arcade, where the player is essentially renting the game for as long as their in-game avatar can stay alive (or until they run out of tokens). Games on consoles or PCs can be referred to as "arcade games" if they share these qualities or are direct ports of arcade titles. Many independent developers are now producing games in the arcade genre that are designed specifically for use on the Internet. These games are usually designed with Flash/Java/DHTML and run directly in web-browsers. Arcade racing games have a simplified physics engine and do not require much learning time when compared with racing simulators. Cars can turn sharply without braking or understeer, and the AI rivals are sometimes programmed so they are always near the player (rubberband effect).

Arcade flight games also use simplified physics and controls in comparison to flight simulators. These are meant to have an easy learning curve, in order to preserve their action component. Increasing numbers of console flight video games, from Crimson Skies to Ace Combat and Secret Weapons Over Normandy indicate the falling of manual-heavy flight sim popularity in favor of instant arcade flight action.^[110] Other types of arcade-style games include fighting games (often played with an arcade controller), beat 'em up games (including fast-paced hack and slash games), light gun rail shooters and "bullet hell" shooters (intuitive controls and rapidly increasing difficulty), music games (particularly rhythm games), and mobile/casual games (intuitive controls and often played in short sessions).

The term "arcade game" is also used to refer to an action video game that was designed to play similarly to an arcade game with frantic, addictive gameplay.^[111] The focus of arcade action games is on the user's reflexes, and the games usually feature very little puzzle-solving, complex thinking, or strategy skills. Games with complex thinking are called strategy video games or puzzle video games.

Emulators such as MAME, which can be run on modern computers and a number of other devices, aim to preserve the games of the past. Emulators enable game enthusiasts to play old video games using the actual code from the 1970s or 1980s, which is translated by a modern software system. Legitimate emulated titles started to appear on the Macintosh (1994)^[112][113] with Williams floppy disks, Sony PlayStation (1996) and Sega Saturn (1997), with CD-ROM compilations such as Williams Arcade's Greatest Hits and Arcade's Greatest Hits: The Atari Collection 1, and on the PlayStation 2 and GameCube with DVD-ROM titles such as Midway Arcade Treasures. Arcade games are currently being downloaded and emulated through the Nintendo Wii Virtual Console Service starting in 2009 with Gaplus, Mappy, Space Harrier, Star Force, The Tower of Druaga, Tecmo Bowl, Altered Beast and many more. Other classic arcade games such as Asteroids, Tron, Discs of Tron, Yie Ar Kung-Fu, Pac-Man, Joust, Battlezone, Dig Dug, Robotron: 2084, and Missile Command are emulated on PlayStation Network and Xbox Live Arcade. The emulators have evolved to be used in mobile phones (APPS) or websites that function as an online emulator.

In addition to restaurants and video arcades, arcade games are also found in bowling alleys, college campuses, video rental shops, dormitories, laundromats, movie theaters, supermarkets, shopping malls, airports, ice rinks, corner shops, truck stops, bars/pubs, hotels, and even bakeries. In short, arcade games are popular in places open to the public where people are likely to have free time.^[114]

Currently

Arcade machines spawned various communities and industries such as Fighting game community, and popular tournaments such as Evolution Championship Series.

The American Amusement Machine Association (AAMA) is a trade association established in 1981^[115] that represents the coin-operated amusement machine industry,^[116] including 120 arcade game distributors and manufacturers.^[117]

Often averaging the amount paid per game based on the length of the game play, knowing people are likely to try more than one game.

For arcade games, success was usually judged by either the number of arcade hardware units sold to operators, or the amount of revenue generated, from the number of coins (such as quarters or 100 yen coins) inserted into machines,^[118] or the hardware sales (with arcade hardware prices often ranging from US$1000 to US$4000 or more). This list only includes arcade games that have either sold more than 1000 hardware units or generated a revenue of more than US$1 million. Most of the games in this list date back to the golden age of arcade video games, though some are also from before and after the golden age.

These are the combined hardware sales of at least two or more arcade games that are part of the same franchise. This list only includes franchises that have sold at least 5,000 hardware units or grossed at least $10 million revenues.