God damn what a geeky title. Anyway, awhile ago I explained why the death of the video game arcade during the 1990s and 2000s had nothing to do with the rise of 3D graphics and more powerful hardware available on systems you could play at home.
The important thing to notice is that graph of arcade and home console sales that I re-drew from an academic's paper. After recovering from the early-'80s crash, arcade game sales peaked in 1988, so that the first year of the steady decline was 1989. The Super Nintendo was not even available, let alone prevalent. The Sega Genesis was only available as of August of 1989, but its early games were nothing compared to what you could find in an arcade. Anyone who says that, during the '90s, home consoles could replicate the arcade look must not have spent much time in the arcades.
Rather, the death of video game arcades was part of a broader pattern of people withdrawing from public spaces, especially the larger and more carnivalesque ones. During the massive social transition of the late '80s / early '90s, people started spending almost all their time at home, and when they did go out, they were only willing to travel a short distance, to a smaller and tamer atmosphere, and for less time.
It just occurred to me that pinball is a good test case for the sane and silly ideas about why arcades died. Pinball cannot be replicated on a home video game system or any video game system because it is not a video game. It could be simulated, but not replicated. For awhile, pinball was very popular, even into the early '90s, with the Addams Family game being the most popular. During the '90s and 2000s, though, it vanished along with video game arcade cabinets.
My idea explains that perfectly -- people started hunkering down in general, avoiding the arcade altogether, so everything inside it disappeared, not just the video game machines. Mini-golf, roller rinks, pizza parlors, etc., all have died off too, for the same reasons, and they used all have pinball machines. The silly idea about home systems replicating the arcade experience cannot explain the death of pinball. Again, video games cannot replicate pinball at all -- and it's not as though people started buying pinball machines for home use that were roughly as good as the ones they used to play in noisy public spaces.
Moreover, there were hardly any home video games that tried to simulate pinball -- a handful, but not enough to kill off the real thing. Devil's Crush is the best pinball video game, but it was on the TurboGrafx system, which almost no one had. Nope, people just forgot about pinball altogether and started focusing more on first-person shooters and soap-opera-like role playing games.
This argument also applies to those ticket-redemption games that were popular at Chuck E Cheese's, roller rinks, Putt-Putt, etc. Those are gone in everyday life, and it wasn't because there was some fantastic simulation of them on a home video game system. And they certainly weren't replaced by good-enough versions for use in kids' homes -- anyone who was a kid then remembers how pathetic the mini/portable version of the "shooting hoops" game was.
Kids and adults both agreed, openly or not, that unsupervised public spaces were too dangerous, so the kid began staying indoors all day, even if that meant not being able to play skeeball or Final Fight anymore. That behavioral change is what dried up the arcades, not technological progress.