Coin-operated Arcade Game Manufacturing Industry
We estimate that the coin-operated arcade game manufacturing industry in the United States has a market size of about $4.95 billion. Unfortunately, we were not able to find this data directly, since both government and industry reports from the United States classify arcade games along with either video games or gambling games, like slot machines. However, much more detailed information is available for Germany, in fact more than for any other country we could find, and so we have used the German data to triangulate the market size for the United States. Below please find a detailed discussion of the methodology behind this report and why it was necessary to use German data, followed by the calculations which led to the final estimate of $4.95 billion.
We began by searching for industry reports and estimates for the coin-operated game manufacturing industry in the United States, however, there were no relevant reports available, as all those we found included arcade games in the "video games" category, and gave figures for the category as a whole. Given the prevalence of the video game industry, and the popularity of video games for home consoles and computers, we were not able to draw conclusions specific to the coin-operated arcade game manufacturing industry from those figures. We also found some reports which put arcade games together with slot machines and similar gambling machines, however, once again, these figures were too general to use as the basis of estimates specific to the coin-operated arcade game manufacturing industry.
We then looked for data from both the Census Bureau and the Bureau of Labor Statistics, however there was once again a classification problem. Both organizations classify companies using NAICS, the North American Industry Classification System, and under that system, "Manufacturing coin operated game machines" is classified under, "U.S. Industry 339999, All Other Miscellaneous Manufacturing". This category includes industries as varied as, "artificial Christmas tree manufacturing", "potpourri manufacturing", and "hairpieces (e.g., wigs, toupees, wiglets) manufacturing". Therefore, none of the data about this group reported by the government was nearly specific enough to use as the basis for calculations about the coin-operated arcade game manufacturing industry either.
Since there was no relevant data available for the United States, we examined the data available globally, with even more limited results. Finally, we examined country-specific data for a few other countries, including the United Kingdom, but found that of all the countries we looked at, Germany had by far the most complete information available, since their Federal Statistical Bureau collects data on this specific sub-industry, making Germany the only country to do so as far as we are aware. Moreover, as a developed European country, Germany has a relatively similar economy to the United States, compared with most countries in the world. Therefore, we have used the data available from Germany to calculate the approximate size of the coin-operated arcade game manufacturing industry in the U.S.
In Germany, the market size for the manufacture of coin operated "amusement machines", which is what coin operated arcade games are called in Germany, is 860 million Euros (about $1.06 billion) for 2016, up from 790 million Euros in 2013. This is a growth rate of 2.15% per year.
To estimate the market size in the United States, we can compare the size of the American economy with the size of the German one. The GDP of the United States is about $19.36 trillion, while the GDP of Germany is about $4.15 trillion, both figures as of 2017. This means that the American economy is about 4.67 times the size of the German one. Therefore, to estimate the market size of the coin-operated arcade game manufacturing industry, we can simply multiply the size of the German industry ($1.06 billion) by 4.67 to find that the market size of the coin-operated arcade game manufacturing industry in the US is about $4.95 billion.
An alternative way to calculate this estimate would be to compare the populations of the two countries. The population of Germany is about 80.59 million, and the population of the United States is about 326.63 million. This means that the United States is about 4.05 times the size of Germany by population. Since we are looking for market size, it seems more sensible to do the calculations on the basis of the difference in the size of the economies of the two countries rather than by the difference in population, however if you feel that population would be a better metric, then you can easily recalculate my figures using the population difference of 4.05 times rather than the economic difference of 4.67 times. This would result in an estimated market size of $4.29 billion.
Though direct data about the coin-operated arcade game manufacturing industry is not available for the United States, the German Federal Statistical Bureau collects detailed information about the same industry in that country, where the market size is 860 million Euros, or $1.06 billion, and the growth rate is about 2.5%. Based on the difference in size between the German and American economies, we have calculated that the size of the coin-operated arcade game manufacturing industry in the US is about $4.95 billion.