(Continued from page 29)
By 1992, we'll have the largest ~o~e market of p layers
in the history of thzs zndustry.
ships for communication within this industry. I'll hear
about problems in the field , and this will help us
recognize and correct problems.
Let me give you an example of how a direct com-
munication between an operator and the manufacturer
can help. This actually happened to me, and I don't see
how this would have found its way through the existing
communication channels. Quite a few years ago an
operator suggested to me , "I don't understand why you
guys don't use yelllow paper to print your schematics on."
And I asked him what's so good about yellow paper. And
he said , "Don't you know that in less than ideally lit
locations, it's easier to read off yellow paper?" And he
said I should try it. So, when I went back to the factory, I
photocopied some schematics on yellow paper , then went
down to a cocktail lounge that night , a place where games
would be. And when I pulled out the two schematics, I
found I could read the one on yellow paper a heckuva lot
easier than the one on white paper. And I saw the same
was true under flourescent lighting. I found, overall, that
it's just a whole lot easier for the operator if the sche-
matics are printed on yellow paper. And ever since then
Bally's schematics have been printed on yellow paper.
This minute detail, which was brought up by an operator,
is very important when you talk about what that opera-
tor's mechanics have to do on a daily basis. When you
talk about communications with operators, they have a
lot of ideas and suggestions. They've always had . And
I've learned more from operators, bringing back sug-
gestions like this that we could incorporate into Bally
product to make it better for the operator.
PLAY METER: Turning back to the subject of systems
games. Another criticism, if you will , of system games
when they first came out, was that they would bypass the
distributor. What do you see as the distributor's role with
the system games?
POWERS: First of all, there's always going to be a place
in this industry for operators, manufacturers, and dis-
tributors. This industry was built on that three-tiered
basis, and I don't see anything that could replace that.
For one thing, you're still going to have dedicated games.
You've got dedicated pinballs, vending machines , juke-
boxes , pool tables, and so on. What the video game
systems mean to the distributor is that he won't be selling
as many main frames, full complete video games in the
future. But he will be selling more kits.
One distributor asked me last week, "Is it going to
come down to the point where I'm going to be selling used
kits?" And I said, "Probably." I said it's not inconceivable
for a distributor in the future to be accepting trade-ins on
SAC-Paks that he can then sell to operators who maybe
haven't tried that game. It's very possible that there will
be a market like that down the road.
PLAY METER: And what was the distributor's reac-
tion to that?
POWERS: His reaction was good . A year ago every-
body in this industry was down because people didn't
know what to expact. But today everybody is up about
the industry because they see where things have finally
settled down , and there's finally a sense of direction . So,
for the distributor, he sees where things are going and
knows what to expect. It's when the unexpected happens,
that's when you get hurt.
As for Bally Sente, we've just done something new
with regard to our relations with our distributors. We've
set up exclusive geographical boundaries for all our dis-
tributors. We view it as a more formalized way of doing
business . It really should help the distributor control and
know his marketplace, to see into the future and be able
to predict his sales . We've heard people in the industry
say to the operators for years that they've got to get a
contract on their locations to protect themselves so they'll
know what to expect week after week . That's the only
way you can run an orderly business. In the same manner ,
we have taken it to the other level where we're doing the
same thing . We've gone to the distributor network we
plan on supporting and arranged it so that we11 have a
marketplace that they'll look after.
PLAY METER: And how do you expect to stop dis-
tributors from selling outside their territory?
POWERS: There is a clause in the agreement which
allows us to pass through a certain percentage of the
selling price from the distributor who sold outside his
territory to the distributor in whose territory the equip-
ment was sold. The reason for that is, generally speaking,
it's the distributor in that territory who will be responsi-
ble for servicing the Sente equipment.
It's nothing really unusual because your vending
companies sell to large national accounts directly,then
pass the money through their distributorships that have
that vending territory because that distributor is the one
who is going to have to service that equipment. So,
basically, we're starting to do that on the games side now.
We think this is healthy for all concerned and wouldn't
have tried it if we didn't think it would work out.
•
We ,v e set up exclusive geographical boundaries for all our dis tributors.