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Intel sets sights on arcade games

The niche requires powerful processors to drive the sophisticated graphics and an array of other workstation-class computing demands.

Intel (INTC) is taking on one of the last high-end computing markets, arcade game machines, a niche that requires powerful processors to drive the sophisticated graphics and an array of other workstation-class computing demands.

Four game developers today released the first arcade games based around the Pentium II platform and the Open Arcade Architecture (OAA), a shift in hardware strategy that should deflate the risks involved in the arcade game business as well as open up a new market for computer vendors.

The closed architectures of most game machines have made the game industry "a bloodbath" in recent years, according to Andy Fischer, senior consultant with Jon Peddie Associates. If the game is a hit, game vendors and arcade owners rejoice. If it isn't, these parties get stuck with unpopular hardware boxes that can cost up to $15,000.

OAA establishes a common hardware platform specification for these machines. Therefore, if the game proves unpopular, the vendor or arcade owner can change the software without having to get a new box as well. The OAA effort was announced last December.

"We're bringing the dynamics of the PC market to the arcades," explained Clause Leglise, vice president of the content group at Intel. "You can amortize the cost of the hardware over more games."

The advent of PC market dynamics also means that the chief providers in this industry are likely to change. OAA-based machines are essentially Intel workstations optimized for graphics performance, said Leglise. As a result, computer makers such as Compaq and PC graphics chip makers are increasingly going to be selling into this relatively lucrative market. If the effort is successful, Intel will sell more chips too.

"This is a particularly interesting market because it is high-end," Leglise said, adding that cooperation with game vendors will in turn lead to better graphics performance in home computers.

The game companies themselves, which currently create the software for the games and work on the hardware design, will begin to function more like system integrators. Right now, components come from a variety of manufacturers while Hitachi, among others, provides the processors.

Hanaho/Kalisto, Inner Workings, Interactive Light/Immersia, and Location Based Entertainment debuted OAA units at the Amusement and Music Operators Association Expo in Atlanta this morning.

The typical OAA machine will cost approximately $5,000 or more, said Fischer. The OAA group recommends that at a minimum vendors use a 266-MHz Pentium II, 64MB of memory, and a high-end graphics accelerator coupled with the Accelerated Graphics Port, said Leglise.

Although proprietary systems often perform better than open systems, the OAA machines built to date exhibit graphics performance comparable to the former, Fischer added.

Intel is an investor in CNET: The Computer Network.