The arcades are alright.

JAPAN'S ARCADE INDUSTRY MAY be flagging a little, but you certainly wouldn't guess it from the Tokyo Amusement Machines Show. We went down to the massive trade fair in September and spent the day playing the latest arcade games and browsing the state-of-the art technology. When our arms and feet were exhausted from prodding buttons and stomping pedals, we were left with a strong impression: If this is one of the industries that has allegedly started running out of steam, then Japan doesn't have much to worry about.

What impressed us most was the sheer inventiveness of the games. Arcades have been around for nearly 30 years, and there has always been a fear that once every genre had been tried there would be no more bottomless pit for kids' pocket money. What the mainly Japanese makers displaying their wares clearly showed was that even the oldest genres can still be rendered flesh and exciting.

Sega provided a prime example of this: It has now designed a hydraulic simulator into which any piece of driving or flying software can be loaded. To demonstrate the versatility of this fearsome device, each of us chose a different vehicle.

One was in a Karting championship, the other in a futuristic cyber-sled. As we each incompetently lurched around a road and a space arena, respectively, the machine hurled us about in perfect synchronization with the events on the screen. Dizzily and dazedly staggering off, we concluded that the effects were far too close to reality for comfort--at least for anyone over 15.

Music was a big theme of the whole show. Many games concentrate on plastic versions of classical instruments and encourage even the most tone-deaf to play along with famous old tunes.

One of us plucked at a Shamisen, the other pounded on a Kodo drum until he was red in the face. Later, we both squeezed into a tiny booth for a karaoke showdown. As we warbled our way through a couple of Morning Musume  belters, we were rewarded with little sweets--depending on which of us hit the truer notes.

Elsewhere, the theme of physical reward was also a strong one--and this, we believe, is what the message of the show was. The innovation that has been poured into Japanese arcade games over the years means that the technology has far outstripped the raw concepts.

Finally, the likes of Namco, Sammy, Taito and Sega have realized what they need to do: keep the gaming simple, but reward people for their success. Like it or not, arcade culture is not what it was in the 80s, and customers need more than a high score to walk away from a machine satisfied. Now they want fluffy toys as well.

The games makers have responded by adding a prize contingent to almost every type of game--driving simulators that pump out prize tokens, sophisticated prize-grabber games, Print Club machines that connect to mobile phones and a host of others. We rounded a corner to see our hunch proven exactly correct: This show was meant for arcade owners, and yet an area the size of a football field was devoted to merchandise. Just row after row of fluffy physical rewards to take home and treasure.

--The Editors