Is the LAN Shop Business Model Defunct?

Many things about the Internet have changed since the early 21st century, and one of them is the accessibility of the Internet in itself. Though it has been slow-going in some parts of the world (especially those that are particularly far away from what we consider “civilization”), the accessibility and affordability of Internet access has been climbing with each passing year. It has also helped that devices that access cyberspace have become more practical and also increasingly cheaper. Look around you; just about everyone has a mobile device (a smartphone, likely) that is capable of Internet access.
Let’s narrow the focus on a particular business model that has been a mainstay since the dawn of commercially available Internet: the humble LAN shop.

Actually, these computer rental places have been there even before the widespread expansion of the ‘net, albeit as offline computer rental and computer gaming services. Web access has made it even more proliferate and lucrative, and with the rise of online gaming (MMORPGs, game rooms, online gambling, etc.), it enjoyed even further success.
Ironically, the spread and “cheapification” of Internet access and internet-capable electronics is affecting the LAN shop business in a negative way. The price of access has also made it viable for people to subscribe to one or more internet providers to give them access at home and just about everywhere else. No longer do people need to plunk down in a specific area to partake of Internet; it is available just about everywhere they are. Once, a serious gaming system would be only within the financial reach of affluent people and businessmen who seriously invest in hardware for their LAN shops. Now, a sub-$500 gaming console can offer you a decent gaming experience, and increasingly more game titles require an Internet connection to further enhance the experience.

So, should you still consider filling out the business incorporation documents, buying loads of Windows and game licenses, PC and networking hardware, and coming up with your own LAN shop? Generally, I’d advise against it… save for when the following conditions are still true for where you plan to set it up:

Limited Internet Connectivity

There are still nooks and crannies in this supposedly well-connected world of ours that Internet access is still spotty, at best. In such places, the barrier to entry for Internet access is rather restrictive, with either the cost of electronics being too high for the general populace, or the price of Internet access still as restrictive. Provided that there are enough people that can support a decent income, this presents an entrepreneur with an opportunity to provide decent access at a more affordable rate.

Prevalent Gaming Culture

In places like Korea and China, the availability of cheap Internet hasn’t wiped out the LAN shop business primarily because of electronic gaming. With the most advanced PC hardware, an obscene amount of virtually lag-proof bandwidth, and plenty of people to compete with in both LAN and fully online games, the “PC shop” is still a major thoroughfare for the gamer crowd and their fans. For as long as professional gaming is still an in-thing, the LAN shops that can support high-end gaming will continue to thrive.

Specialized Services

Some LAN shops are also veritable virtual offices that provide certain services that are either too expensive for other small companies to justify, or they simply just have the better technology. In that sense, a BPO-based business is somewhat of an over-glorified LAN shop. If you can gather up a clientele of outsource-based workers that still need office facilities and stable internet access, then your LAN shop business might just thrive for a bit longer.

Stacey Thompson is a professional writer, marketer, entrepreneur, and a lover of weird little animals. She is based in San Diego, California, and actually drops by her favorite gaming LAN shop now and then. Stacey and her friends have a blog, Word Baristas.