The presence of Pinball Pete’s on South University Avenue is a real head-turner for passers-by. The hot-pink awning, flashing lights, and the buzzers and bells of pinball games all combine to entrance us into cleaning out our pocket change battling the Balrog in the “Lord of the Rings” pinball game. But the real reason for a double take is, “How in blazes is an arcade still in operation?”

Allison Kruske/Daily
Allison Kruske/Daily
Allison Kruske/Daily

After all, arcades are an institution as antiquated as bookstores and Blockbusters, even for Ann Arbor. We now live in a society in which “gaming” means temple-running and launching birds with a flick of the finger, where kids are weaned on Wiis and “Call of Duty” team deathmatches. Yet, for over 30 years, Pinball Pete’s has endured. While much of the arcade industry has seen a precipitous decline in business, Pinball Pete’s has persistently evolved to succeed and continue as the last bastion of old-school gaming in the region.

This propensity to adapt has been in Pinball Pete’s DNA since its inception. It started in 1973, when East Lansing native Ted Arnold and his two elder brothers, all pinball fanatics, pooled their money together to buy and refurbish a used pinball machine. Arnold was just eight years old at the time, and his brothers were only teenagers. At first, they only shared the machine with close friends, but it soon became the talk of the town.

“Soon, neighborhood kids wanted to come over and play pinball too,” Arnold said. “After school, we’d have about 20 bikes in the driveway.”

A new venture was born — charging a dime for a game and a quarter for three, the budding entrepreneurs started saving money to boost their business. Next came a Coca-Cola machine, followed by a candy counter and another pinball machine. After a year and a half, the brothers were running a full-fledged mom-and-pop operation in their garage.

Then, the mighty hammer of government bureaucracy struck. A city inspector demanded the brothers cease and desist their operation, since they were running a business in a residential area. But the brothers were ready to run a business full time, briefly shifting operations to Monroe, Mich. before returning to their hometown to open a proper storefront. Their first East Lansing location was in a former doughnut shop with a life-size fiberglass elephant on the roof. Here, the pink pachyderm logo of Pinball Pete’s was immortalized.

“We said, ‘If we’re going to run this arcade, how are we going to get people to notice?’ ” Arnold said. “ ‘What if we went up there and painted that elephant pink?’ ”

Their initial plan was to enlist their mother to make a paper-mâché cowboy, who would have been the eponymous Pete, to sit on the elephant.

“We went up and painted the elephant pink and had a few cervezas, but the next morning we realized we didn’t have a cowboy on it so we left the elephant pink and decided we’ll just call him Pete,” Arnold said.

By then it was the late ’70s, and the very first video games began to enter the market. Pinball Pete’s became a hotspot in East Lansing after its proprietors snapped up a system that could play Pong, Space Invaders and other games.

“The rest is basically history,” Arnold said. “We never looked back, continuing to buy more and more games.”

When the ’80s rolled in, business was a-booming, so Arnold and his longtime business partner and friend Mike Reynolds decided to expand operations into Ann Arbor even though the city was flush with arcades, such as the Simulation Station and The Cross-Eyed Moose on East Liberty Street and Double Focus on State Street. Arnold and Reynolds took over the spaces of the arcade Mickey Rat’s, which had a joint on William Street and one in an old Victorian house on South University Avenue— the latter of which was set ablaze in 2009.

Pinball Pete’s consolidated its Ann Arbor storefronts and moved to its current location in 1996, tripling its overall square footage. And to counter the ’90s boom of home consoles, the owners bolstered their selection of games that are hard to duplicate at home, such as air hockey, skeeball, Dance Dance Revolution systems and prize games.

“The socialization aspect of the arcade is really one of the things that has kept us in business,” Arnold said. “Because kids realize, ‘If I’m looking to go out and meet other people, this is where I gotta come.’ ”

While the family and social games were crucial additions, Pinball Pete’s never abandoned its namesake gaming platform, even when other systems seemed more trendy and profitable.

John Cross, an Ann Arbor native who has been spending pocket money on pinball at the city’s arcades ever since there was a Mickey Rat’s, noted that Pinball Pete’s loyalty to pinball enhanced its appeal and might have contributed to its outlasting of the competition.

“There was a time when we started seeing all the (pinball) machines (in other arcades) getting replaced with DDR and Time Crisis,” Cross said. “But it’s great that (Pinball Pete’s) has kept so many here that are working.”

Always with a keen sense for customer wishes, Arnold and Reynolds haven’t stopped supporting their pinball players. In the past year, they purchased four new machines including “Tron: Legacy”- and “Iron Man”-themed games. Even though the games cost $1 per play as opposed to the traditional 50 cents — much to the dismay of some old-school players — patrons loved having new challenges to conquer and flickering targets to thwack with silver balls.

The new games keep customers coming through the doors, but for patrons such as Scott Nelson Wood, arcades will have an everlasting, irreplaceable appeal.

“I like video games at home, but it’s just something about being in an arcade. You get the actual feel of things,” Wood said. “With pinball itself, the way you move the machine actually has a lot to do with the game, and you learn to become almost ‘one with the game.’ … Just like how people have personalities, every machine has a personality.”

Opportunities to grow aren’t as bountiful as they once were, but Pinball Pete’s is still finding new avenues to make money. Aside from hosting private parties and lending their machines for corporate events, the arcade has kept afloat with its “street route” strategy: giving game machines to bars, restaurants and other establishments and taking a cut of the revenue. All these savvy business decisions have paid off — Pinball Pete’s has survived the arcade apocalypse and has a bright future. It’s recognized as one of the “Five Best Arcades in America” by Tips & Tricks magazine.

“We’re not planning on going anywhere,” Arnold said. “We’ve got a long-term lease.”

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