What genres do you think would work best for arcade, both real and potential?
Racing and flight simulator games. Those are the games where the additional hardware an arcade can provide can make a difference with playing at home, while also allowing multiplayer. You can buy a wheel, or a flight stick to play at home, but if you begin to add rocking chairs, a pod like the one above and the like, your cost is going to increase.
I think they should also follow the demographic change and sort of become more like a pub: you go with friends to play pool, table tennis, darts and, yes, Daytona USA 2015.
But I still think it's a hard thing to do. I don't think MMOs and FPS translate well into the arcade experience (when compared with playing at home) and those are likely to dominate gaming anyway. There is still an attractive in playing right next to your friends instead of speaking over the Internet, but once your target already has the same games in his home and a reliable Internet connection, I don't think the arcades can compete. They have to offer something to complement online gaming: a different experience, first and foremost.