arcades are dying.
thats why this was so confusing to me:

This sums up most of my thoughts well. The possibilities I would add are:

Have an excellent internet connection, and hold tournaments vs other locations. Have players compete to be in these tournaments, and then send your best 8 vs another arcade's best 8. Games like Halo 3, played on larger screens than people have at home, which a more social atmosphere would be popular.

Also, as far as the high profit foods go, add in attrative waitresses. It makes charging a lot for food and drinks more economically viable.

Having online tournaments is definitely one of the things I think would help to revive the arcades. You would definitely have to figure out a way to get a large number of different arcades to put it together to have any cultural or financial impact of any significance.

Only if they go balls to the wall on novelty, and refocus their efforts as a premium experience marketed to a select crowd. If you go for a high-brow audience whose loyalty could be guaranteed, and also subsidize the whole experience with snackfoods and the like (somewhat as voty suggested)

I'm sure there could be some sort of a franchise similar to Dave and Buster's that has the ability to be successful, albeit on a smaller building scale, and focusing more on video games.

not really dying its just getting too old pretty quick when you try to play it.

What?

ddr everywhere!!! and beatmania and all the bemani games. that's all you need