Whoever Gets the Most Leisure Dollars Wins

It may have been the opening of a video arcade in Seattle, but it had Hollywood’s fingerprints all over it.

Televised nationally on MTV last weekend, it showcased media stars like “Fresh Prince” Will Smith and recording artists Coolio and Beck astride the latest in video games, including one that ended with a gut-wrenching 24-foot free fall.

It was the kind of star firepower that only GameWorks, the $10-million brainchild of movie producer Steven Spielberg, could assemble. His DreamWorks SKG has teamed up with Sega Enterprises and Universal Studios and plans to build 100 of the $10-million entertainment emporiums nationwide.

With a blend of proprietary video games, designer pizzas and stylish architecture, GameWorks offers stark proof that some of the biggest names in entertainment are now heading toward suburban malls and urban centers near your home.

Names like Disney, Spielberg, Sony--heavyweights with the business savvy and marketing might to dominate the theme park industry, produce Hollywood’s blockbusters and shape popular music--are looking for more. Now they’re using their considerable clout to change the way we play:

* Walt Disney Co., keeper of the Magic Kingdom that stretches from Anaheim to Tokyo, has spent millions on Club Disney, an upscale play site in Thousand Oaks that’s the prototype for a proposed 100-unit chain.

* Earlier this month, Dave & Buster’s, a Dallas-based arcade chain catering to adults, opened its premiere California location at the massive Ontario Mills shopping center.

* Sony Corp. is readying a huge four-story entertainment center in downtown San Francisco envisioned as the flagship for a fleet of major clubs to open in urban centers around the world.

* Odgen Corp., which operates venues such as the Great Western Forum, is breaking ground on a chain of mall-based storefronts that will blend live animals and motion-simulator machines to give suburbanites a wilderness experience.

* Brunswick Corp., which makes everything from bowling balls to outboard motors, recently opened Red’s Rec Room at a massive mall in Alberta, Canada. The prototype may be the precursor to a string of centers that incorporate a campy collection of bowling lanes, restaurants, bars and arcade games.

“We’re looking at things that a family can do for two or three hours after school and on weekends,” said Jay Rasulo, senior vice president of the new Disney Regional Entertainment division. “And, like Club Disney, the new concepts will be very different from Disneyland.”

And not all that cheap. Club Disney charges $8 for admission--and that doesn’t include food and gifts. And that catered birthday party for your child? Figure $250 for a dozen attendees.

Although GameWorks doesn’t charge an entry fee, competitors say a family of five could probably easily spend more than $100 on games and meals.

The new playgrounds are wrapped up in typical Hollywood hyperbole. Disney promises to “set a new standard for local family entertainment,” and GameWorks pledges a “one-of-a-kind entertainment experience.”

Critics might scoff at the unbridled self-confidence, but there’s no denying that these companies are an elephantine force.

They know that Americans place a high level of trust in respected brand names. That’s why Mickey Mouse’s footprints are all over Club Disney, and why GameWorks is heralding its high-intensity game parlor as “Steven Spielberg’s three-ring circus.”

They are also crafting alliances with brand names like Starbucks and Cheesecake Factory as they assemble one-stop centers where patrons can eat, drink, play and shop.

But despite the hoopla, these companies have reason to move carefully. Developers caution that entertainment could suffer the same fate as retailing, with consumers becoming numbed by a string of look-alike shops in malls across America.

And some big names have already stubbed their toes trying to build nationwide chains that blend entertainment and dining.

Disney’s vaunted pixie dust proved ineffective during the early 1990s, when the company threw in the towel on Mickey’s Kitchen, a restaurant chain offering Meatless Mickey Burgers, Pinocchio Pizza and French fries shaped like Disney characters.

Six Flags has put Funtricity, the prototype for a string of entertainment centers, on hold, and Paramount Parks sold its interest in Block Party, another prototype aimed at adults.

Despite the potential barriers, developers sense that now is the time to strike. They’re playing to the fears of many who think the world is spinning dangerously out of control.

“We’ve all watched what’s been happening in the [San Fernando] Valley with AK-47s,” said Michael McCall, a Columbia, Md.-based consultant who helped design Brunswick’s funky bowling emporium. “It’s sad but true. . . . We’re creating a community neighborhood where people feel safe, secure and can allow themselves to have fun.”

There’s no shortage of existing playgrounds. Americans already spend an estimated $8 billion annually on video games, juke boxes and other token-grabbing machines found at 4,500 family entertainment centers and arcades.

Most of those mom-and-pop operators are adding video games and motion-simulator rides to their proven arsenal of miniature golf, go-carts and batting cages. But few of them have the deep pockets and marketing know-how to tangle with the corporate army now on the march.

“When you put the corporate dollars that Sega has together with the creative mind of Steven Spielberg, you’re going to have a very high-profile, well-received arcade,” said Ed Pearson, general manager of a family-activity center near GameWorks and president of the National Assn. of Family Fun Centers. “It’s a wake-up call for our industry.”

Smaller operators that fail to respond run the risk of being steamrollered by the powerful new players.

A case in point: Few mom-and-pop operations can afford more than a handful of the hot Indy 500 video-racing machines that retail for about $15,000. But GameWorks can plug in several of them. And there are plans to hot-wire them to sister locations, clearing the way for nationwide competition.

GameWorks will also hone its competitive edge with proprietary attractions like Vertical Reality, a Spielberg-inspired game in which four players strap themselves into chairs that climb to a height of 24 feet, then plummet to the ground whenever weapon-wielding bad guys on a massive video screen score a direct hit.

Interactivity is the key word among the new concepts.

At most restaurants--even high-profile ones such as Planet Hollywood and Hard Rock Cafe--”you eat and look,” McCall said. “What we wanted to create was a product where you did the theme.”

That’s why Red’s campy setting, which borrows heavily from your grandfather’s ‘50s-era basement recreation room, incorporates live entertainment, a children’s play area, billiard tables, arcade games and the “Furnace Room,” where patrons can puff expensive cigars and quaff aged scotch.

Anyone old enough to remember clubs where patrons used tabletop telephones to talk with each other will get a chuckle out of the high-tech parallel at GameWorks, where guests chitchat via computers.

Club Disney adds its own twist to interactivity. Since unchaperoned kids aren’t allowed, parents dance the Mickey Macarena, take part in a Disneyesque onstage play and sit down with their kids in the “Chat Hat,” a room filled with interactive-media games.

But don’t worry about running out of quarters: The new entertainment centers are borrowing a page from Dave & Buster’s, which offers an ATM-like debit card and plenty of convenient “power stations” where the cards can be recharged.

Soggy pizza and watered-down drinks might be fine for a 10-year-old’s birthday party, but not when you’re chasing upscale customers.

Michael Swinney, president of Sony Retail Development, readily acknowledges the surfeit of wonderful restaurants surrounding Sony’s downtown San Francisco entertainment center. But the center will offer 10 restaurants of its own. Said Swinney: “We’ve got to be out of our minds.”

But there’s a method to the culinary madness: The longer you stay, the more you spend.

GameWorks players can sip Starbucks coffee drinks and wash down designer pizzas with suds from an on-site microbrewery. Club Disney offers kids their requisite pizza--shaped like Mickey Mouse--but it also offers upscale entrees from the Bristol Farms grocery chain, Cheesecake Factory desserts and Diedrich coffee drinks.

The intricate blend of entertainment and dining--dubbed “eatertainment” by restaurant industry wags--was pioneered by Dave & Buster’s. Their 60,000-square-foot clubs in effect offer a working blueprint for what the big guys are trying to do.

Ontario Mills, for example, features handmade billiard tables with mother-of-pearl inlays, the latest virtual reality games, Iwerks motion simulators and an ersatz casino.

Make no mistake: Dave & Buster’s knows where its profits come from. Half of a typical location’s $15 million in revenue is driven by electronic games that boast a 90% profit margin. But chain spokesman Dennis Paine said customers spend hours at Dave & Buster’s “because we’re serious about food and beverages. It’s not just a token thing.”

If history is any guide, some of the projects will die untimely deaths.

Tarun Kapoor, a hospitality industry professor at Cal Poly Pomona, cautions that the new neighborhood-based attractions will need continual face lifts--a potentially expensive process given the ever-changing tastes of fickle consumers.

During a recent Urban Land Institute program at the Beverly Hills Hilton, the developer of the Pier 39 park cautioned gung-ho developers about the potential for failure.

“There are a lot of opportunities out there to make mistakes,” said Robert Moor, a partner with Lake Forest, Ill.-based Moor & South. “And if the money is there, mistakes will be made.”