Arcade License

An arcade license is a legal agreement permitting commercial use of video games in public venues like arcade halls, cafes, restaurants, entertainment centers, or specialized e-sports events. Without an arcade license, only private gameplay is permitted; public access or monetization is prohibited.

The reason: video games, like other intellectual property, are copyright-protected. The publisher funding game development wants to control usage and earn revenue if someone profits from the game. An arcade license is a middle ground: allowing businesses like arcade halls to use the game while enabling publishers to calculate revenue through royalties.

Practical example: Suppose you own an arcade hall with classic games like Pac-Man. The hall owner must purchase an arcade license from the entity holding Pac-Man rights (historically Namco, now Bandai Namco). The license might be: “Pay us €1,000 annually, and you can have Pac-Man in your hall.” Or alternatively: “We get 20% of every coin inserted into the Pac-Man machine.”

In modern times, arcade licenses are less popular because most games are available through digital channels (Steam, Epic Games Store, mobile apps). However, they still exist for: classic arcade games, VR games in VR centers, and specialized arcade machines.

For startups developing games considering arcade versions: you must negotiate with publishers, define geographic territories, payment, and profit calculation methods.