They are everywhere. Not sure what OP means.
Round 1 is giant!
No idea why they thrived in Japan (if they did) but I used to LOVE going to the arcade. Couldnt beat playing multiplayer with strangers or experiencing tech that seemed like it was from the future.
Once I was able to get similar experiences at home (with little compromise, no compromise, and inevitably improved hardware), the writing was on the wall.
The idea of (for example) putting on clothes and lining up to play bite sized "PlayStation 5" games for fifty cents a pop just doesn't sound appealing in this day and age.
Bigger & better killed the arcades, I think. Cabinets got expensive, so arcade owners jacked up the price to play; one could play a very close approximation on home console for far cheaper.
I also think there's a link between arcades closing and Dreamcast dying. At that time gamers were really getting into the idea of deep long games, not arcade style at all.
Arcade owners basically destroyed their own market by jacking up the price. In Japan, it's a tightly regulated market, and I don't mean regulated with laws, I mean the business model. You make a few thousand on a cabinet and you're done, you get the next one.
Here in America, the whole idea is, hey let's make 10 grand on this one machine and then never replace it. You end up with all these old machines that cost way more than they're worth because they never lowered the price over time, and no way to resell them bc nobody wants it anymore.
It's like making a specific type of shoe that starts off trendy, and you never change the style or lower the price after the trend has worn off, and you just end up with these dated products that nobody really wants, and even if they did, are way more expensive than they should be. This is typically an american practice in business.
A great example of this is Adidas. Their track suit was very popular during the 90s and they never thought to introduce new products, they just stuck with the same old shit. Meanwhile, underarmor showed up and stole the market right out from under them because they offered things Adidas was reluctant to upgrade into.
Not only in the U.S. but in the "western world" overall.
Home gaming has become more acessible, specially after the motion controls / multiplayer craze of last generation, and the visual gap between arcade and home consoles has dissapeared. Arcades also became too expensive.
In my country (Brazil) arcades are a thing of the past too. There are still a few small arcade centers in shopping malls, but those are aimed at families, they have very few games and most of them are old ones.
I really miss the days of hanging out in arcade centers.... there used to be a lot of them in my city. Today I can name only one who still survives: https://lordsdiversoes.com.br/tatuape.html It´s curious to see that many people still hang out there on weekday nights and weekends, I think most still goes there for nostalgia.
Arcade scenario in Brazil is terrible. I`m also from Brazil, Goiania especifically, and the two malls that still have arcades are terrible, they just took away any shooting arcade, they just have machines that can be played by children...
I'd say it's more along the line of it being to expensive, rather then anything else. Yes you spend 300 on a console, but thats a one time fee. Most Americans have to pay for car insurance, health insurance, property tax, all this other bogus stuff, theres really no room in the budget I'd say. That's just my guess though, I grew without arcades so...People being more social in Japan I don't agree with either. Most people tend to be to themselves in Japan. It's pretty rude to go up to a stranger and try to become friends with them, in fact you'd be shunned for even doing something like that. In Japan another thing is if you have something to do you just do it, no questions about it. In America lots of Americans suffer from anxiety prohibiting them from going out. I mean that happens in Japan too, but the difference is in Japan its more along the lines of "Okay this is my task, I'm going to finish it" thats usually the end of the statement. I know i'm going a bit over board with this, but a lot of this stuff adds up, and ultimately effects the overall scene of the situation. to give you a full idea of everything, you would need to over see just how people interact with one another, how their culture is, and ultimately what their wallets are like.