"lan party" as a business??

[DrPizza]

From some posters on the wall at school, it appears that some kids, or some enterprising younger person has gotten a location and 20 computers networked together. They're having game nights, with certain nights featuring certain games. They had a couple of students at the school as contacts to purchase tickets.

Do any of you think this has a prayer of actually working as a business?
(Or would any of you like to steal this idea and start it locally, marketting it to the local kids)

 

[TitanDiddly]

It has before, but IIRC they tend to file for bankruptcy once all their machines get obselete and they need to upgrade.

 

[Daishiki]

there are lots of pc rooms. usually you pay per hour, rather than use tickets. i know of a few that have lasted over 3 years, but requires a lot of upgrading.

 

[Night201]

There is no stealing this idea. This is nothing new. I have seen many places like this (there was actually one at a mall near me and it closed after about 2 years. Maybe because of what PhasmatisNox said above (upgrading costs, etc.).

 

[ctcsoft]

Originally posted by: PhasmatisNox
It has before, but IIRC they tend to file for bankruptcy once all their machines get obselete and they need to upgrade.

most do fail. it would be nice if they could make it and afford to stay in business but most
can't.

 

[kyparrish]

There's a place like that in Charlotte, went in to check it out one time, and I asked the guy what type of video cards his 20 PC's had. When he said "256mb ones....... Geforce 5200's" I was like uh...... nevermind.

How someone could buy 20 of those POS's and run a PC gaming business is beyond me.

 

[imported_Nacelle]

There was one in Indy that is now a vacant building

 

[wyvrn]

This problem revolves around the cutomer base. I mean hard-core gamers, that are going to make up your core busines, won't play on boxes that don't have the absolute latest technology. But if you are going to run a business that way, then you should fairly be able to charge a premium to cover your expenses. But, gamers tend to be teens and twenties and have less disposable income, so during down economic times aren't going to spend this entertainment money.

So the only business lan gaming business model that is going to work is if you setup in a richer area, charge premiums, and/or have good sponsorship by gaming developers, gaming media outlets, and video card makers. There are a few businesses that can do this, but it is obviously a niche market that only well-funded conglomerate type businesses are going to be able to make work long-run.

However, as gamers age, in the future it might work because older people have more disposable income.

 

[Imdmn04]

Computer depreciates do damn fast, with little salvage value at the end of its useful life.
$2000 computer after 3 years is only worth $300.
That requires u to front 1700 bucks for each computer you are gonna replace.
1700*20computers =$34,000
Thats just the cost of replacing the computers after 1 cycle of useful life, you need to consider the power bill, the rent for the place, wage for employee and other overhead cost.

If you can still make money after all that, it won't be a lot, unless you have sponsors to pay your bills.

 

[virtuamike]

We're actually opening up an internet cafe in 2 weeks, but we're concentrating more on the cafe/food side of the business in order to turn a profit. Only using the PCs to bring people in.

Oh, and we're offering free wireless internet. Beat that Starbucks

 

[Ameesh]

Originally posted by: virtuamike
We're actually opening up an internet cafe in 2 weeks, but we're concentrating more on the cafe/food side of the business in order to turn a profit. Only using the PCs to bring people in.

Oh, and we're offering free wireless internet. Beat that Starbucks

i think thats a good game plan!

people will come for the internet and eat and drink while they are there, make sure your prices are reasonable and people will be more likely to spend more money.

keep us posted on how it goes!

 

[Whisper]

Yeah, pc room/LAN party businesses are actually becoming pretty common here in Atlanta, especially in the Korean community. Go in, pay by the hour, and have internet connection and a set of new games ready to play.

 

[Corporate Thug]

the pc rooms in my area are quite successful

 

[UNCjigga]

I think the only way a business like this could work is if they were located in a large city or near a college campus, and they charged monthly membership fees like $39.95 individual/$99.95 for a clan (unlimited clan members after paying one-time clan setup fee!) Inside, they'd have to have some sort of food/beverage facilities and make money on these impulse purchases from members. Ideally they'd have Bawls and other gamer oriented drinks, and maybe pizza by the slice and other easy food items or vending machines (I imagine most hardcore gamers are of the 'eat anything' variety.)

As far as the game machines go, they should have a few Xboxes connected to the net, as well as some net-connected PS2s. I'm not sure if Live gamertags are tied to their unique xbox or not...but if they aren't I imagine anyone could login to their account on the public xboxes. The beauty of these machines is that they are cheap, require only cheap TVs, and don't require much maintenance/upgrades. I imagine they'd only have to keep a library of the most popular multiplayer games.

PCs are difficult to figure out here. On the one hand, if you just bought Dell's equipped with decent videocards you could save money by buying in bulk and probably use Dell for service and warranty, etc. But if you built your own PCs, all using the same equipment with decent motherboards, you can provide yourself an upgrade path (upgrade to more powerful CPUs later down the line without having to replace the entire system.) What might make sense here is leasing the PCs from Dell and upgrading every 12 months. I know Dell, HP, and Gateway are interested in targeting the gamer market and are setting their sights on Alienware, Falcon Northgate etc...so maybe some sort of marketing deal can be worked out with these companies (only if you plan on franchising this though.)

Once you've got all the infrastructure, intense marketing will be needed to recruit customers. Obviously you'll want to get as many clans registered as possible...and help them to schedule games with other clans around the nation to keep them coming (that's why setup fee in order to get them registered on the web, etc.) In terms of operating hours, I'd think keeping it open on weeknights and weekends only would make sense, so you wouldn't have to pay staff for 9-5 every day (unless you want to be open during the day as an internet cafe or VOIP/conference center to rent out to local businesses.) I don't see a lot of business coming in on the $39.95/month. Marketing should use the message that instead of buying a new game every month, it makes more sense to pay the $39.95 and play all the latest games on the latest hardware in a cooler setting than your bedroom (but do geeks socialize outside their home?? )

 

[lobadobadingdong]

if you had a pizza hut in house it might make more money, but you'd have lots of sticky keyboards. :laugh:

 

[mugs]

If it's "kids" running it, I wonder if they have licenses for all the software.

 

[UnatcoAgent]

There's one of these on my campus, right in the heart of our mall, called 'Campus Cove'. Pool and other activities, as well as about 35 computers networked. It's amazing how packed it is with people, almost all the time.

 

[virtuamike]

Originally posted by: Ameesh

Originally posted by: virtuamike
We're actually opening up an internet cafe in 2 weeks, but we're concentrating more on the cafe/food side of the business in order to turn a profit. Only using the PCs to bring people in.

Oh, and we're offering free wireless internet. Beat that Starbucks

i think thats a good game plan!

people will come for the internet and eat and drink while they are there, make sure your prices are reasonable and people will be more likely to spend more money.

keep us posted on how it goes!

Thx! The gaming will be reasonable, $3 an hour basic and cheaper if you buy in chunks. Only have 10 PCS available (I'd rather have customers wait than have PCs gathering dust) but they're spec'ed to last us through the year. Dell 400SCs - P4 2.8C, 512MB DDR, 9800 Pro, MX300, Audio .90s - all running off a T1. Starting with CS, WC3, SC, UT 2K4, BF:V for now, we'll buy more software when we get requests. Coffee we're going with Seattle's Best, if they suck then we'll go with Pete's or something else. We'll be making smoothies and shakes and selling sandwiches, mini-pizzas, salads, and breakfast stuff. Also installing a 4000W sound system for DJs (no rap/hiphop) and live bands on weekends, planning to stream audio off our T1 for big events.

We're aiming to make it a college hangout. There's a Borders that caters to roughly the same crowd a couple blocks away that we have to compete with but we have plans on how to promote and steal their business. There are also 2 internet cafes in the area but they go after the high schoolers so we don't mind too much. We're being selective in the crowd we cater to.

Overhead cost is gonna be ridiculous for the 1st couple months, but I figure once we get through summer we'll have a good idea as to whether or not the cafe is a success. Will def throw a couple tournaments in July/Aug, that should help bring people in.

Hiring is giving me headaches though, ugh. Most of the applicants are doorknob stupid.

 

[Lonyo]

Originally posted by: Imdmn04
Computer depreciates do damn fast, with little salvage value at the end of its useful life.
$2000 computer after 3 years is only worth $300.
That requires u to front 1700 bucks for each computer you are gonna replace.
1700*20computers =$34,000
Thats just the cost of replacing the computers after 1 cycle of useful life, you need to consider the power bill, the rent for the place, wage for employee and other overhead cost.

If you can still make money after all that, it won't be a lot, unless you have sponsors to pay your bills.

You would need maybe $1500 initial setup per PC, but then you wouldn't need CD drives (use images/No CD cracks if it's a LAN gaming PC).
You could re-use HDD when you upgrade, same for keyboard/monitor/case etc.

You would need a new mobo/proc/graphics card (that would be ~400 per PC, estimating Barton 2500+, 9800Pro, if you wanted a faster system, it would probably still be $400~$500, because you can discount some of the cost from selling the old pieces) and then every 2 years you would need new RAM.
That's only $10000 at 20 comps, every year, plus maybe $4000 every 2 years, so $12,000 a year to keep up (but not be top end).
Also, the 9700 is still a good-ish card 2 1/2 years on. And processors haven't got that much quicker in the last 12~18 months.

It would still be difficult to make money though.

 

[Jeff7181]

I'd think it would be more profitable to have a room, with a server and switch and possibly monitors, and have people bring in their own computers. Basically the only problem with that would be dumbasses spreading viruses and cooling the room