They force-fed me Tastykakes. Early in my visit to the Pennsylvania headquarters of Megatouch—a leading maker of touchscreen game machines—marketing manager Allison Ondik asked me if I’d like some Tastykakes, and I politely declined. She insisted. But seriously, I wasn’t hungry. But seriously, she wanted me to eat those cupcakes.

Later, she walked into the conference room unannounced with a tray full of them. Perhaps I could take some with me and eat them at my leisure, she suggested. It would make her feel a whole lot better if I did. So I put one of those damn Tastykakes in my bag as Ondik looked on, satisfied.

It’s the Megatouch M.O.: Provide customers with short bursts of pleasure. The company makes games for people to play at bars when they’re bored. The empty calories of the gaming world. Ever seen a crowd gathered around a glowing screen trying to spot the differences between two almost-identical photos—or one guy sipping a Yuengling and trying to spot the differences between two shots of the same bare-chested woman? Those are probably Megatouch staples Photo Hunt and Erotic Photo Hunt (and that lone guy is probably a rad dude).

Each machine has a bunch of games to choose from. Some are souped-up versions of Texas Hold ’em or blackjack. There are trivia games, too, and puzzle games that test pattern recognition. Monster Madness, for example, is a “connect three blocks in a row” affair with a bunch of Halloween-themed power-ups. It’s Bejeweled for drunk people.

Testing the Megatouch ML-1

This was the way Megatouch operated for 15 years. Then, last October, the company reinvented itself, or at least claimed to do so. The centerpiece of tomorrow’s Megatouch is a spiffy new machine, sexily titled the ML-1. It’s a 22-inch screen with what looks like a Darth Vader helmet strapped to the back. The ML-1’s overhauled operating system can handle multitouch technology (think iPhone) and a more social gaming experience.

Until recently, a player’s achievements were only saved on the local machine’s high-score table. The guy with the highest Monkey Bash score (a game where you punch a monkey long distances) at Jimmy O’Doulihan’s Irish Pub assumed he stood alone at the top.

But the ML-1 units connect wirelessly to the internet, meaning the Monkey Bash leaderboard also shows scores from Finnerty Shea McSeamus’ Even More Irish Pub across the street and Barry’s Not-At-All Irish Pub across the country. Players can post news of their Megatouch conquests directly to their Facebook walls. Suddenly, the guy with the Yuengling isn’t so lonely anymore.

Suddenly, the guy with the Yuengling isn’t so lonely anymore.

This, the most social of Megatouch doohickeys, was constructed in a bubble of secrecy. Until 2010, there were two major trade shows in the coin-op industry, but they recently combined to form the annual Amusement Expo. Freed from the obligation of making major product announcements twice a year, Megatouch creative director A.J. Russo decided the company could “start from scratch” and begin work on an ambitious new device, skipping the now-shuttered autumn trade show and working right on through until the 2011 Amusement Expo in the spring.

“Trouble is, the timing didn’t work,” said Russo, who oversees marketing and development, deciding what games to make and how they’re made. “We realized [in early] 2011 that despite some heroic efforts, our to-do list for launch wouldn’t be completed until that summer.” In fact, the Megatouch designers didn’t finish the ML-1 until that fall, and instead of a trade show, they unveiled the project with a live webcast.

They didn’t need convention-hall theatrics, anyway. Most of Megatouch’s competition, including outfits like JVL and Midway, have abandoned bartop gaming. Megatouch sells in more than 30 countries worldwide, and in the United States, the company has a market share of 85 percent. And now, with near-total dominance of the industry, Megatouch has decided to boldly…build a prettier, more connected version of what they already had.

A Megatouch unit isn’t a traditional part of the bar experience like, say, a jukebox. Nor is it an overtly money-hungry gambling device like a slot machine. It’s something in between, and that’s the gray area where Megatouch has lived since its beginning. While their development team puts out 12 new titles a year, building on a library that numbers well over 200 games, the company’s most popular games tend to be variants on casino stalwarts.

Why does Megatouch bother developing so many new games, then? Russo likened it to “replacing the felt on a pool table”—an aesthetic improvement that keeps their product looking fresh. That’s not what’s happening with the ML-1, he claimed. This was another story; they were “starting from scratch” and “reinventing” themselves.

But the truth is, the recipe for a Tastykake never changes.

Megatouch testing unit

The hub of Megatouch operations is located in a blink-and-you’ll-miss-it office park, its building indistinguishable from the others. It’s at the end of a winding road lined with one-story concrete blocks. By the time I arrived, I was sure I’d gotten lost—until I spotted a tiny sign with the logo of Megatouch’s parent company, AMI.

It was silent inside. Even the TVs in the lobby, showing Fox News, were muted. The walls were painted the plastery off-white color favored by landlords who are always prepared for new tenants, and they were bereft of decoration aside from a few dated Megatouch ads.

The office is divided into two halves. The business end of things—sales, marketing—occupies a handful of spacious offices that are sequestered in their own little nondescript wing. The creative work happens in cluttered cubicles littered with spare computer parts and half-disassembled machinery. There are arcade-sized consoles, some with arcade-sized error messages and others with cartoonish dancing animals enticing players to touch the screen.

On the machines that are fully constructed and functional, the electronic slabs’ monolithic aesthetic is tempered by panels of fluorescent light at the base and around the screen that create different color combinations—always changing and always on. These units are for bar use, after all, where attention spans are negligible and booze turns the environs into a formless blur. The lights help.

There’s even a conference room in the center of the office where neon Sam Adams signs sit next to machines, testing the screen’s ability to handle the usual bar dank. Occasionally the employees will empty a beer onto one of the machines to see if it can hold up to the harshest of pub conditions.

Erotic Photo Hunt

Erotic Photo Hunt

“No matter how much you think you’ve fully thought things out, when you’re at a bar and you’ve had a few drinks, people do stuff you’d never have expected,” said Russo, without elaboration. Russo’s a happy-go-lucky guy. He dresses in jeans and a button-down. A skinny tie, glasses, and scruff complete the casual-cool demeanor. I got the sense that there’s little that flusters the man. But he’s not an especially calm presence, either. He’s consistently at a seven out of 10.

They focused on the two customer bases they had left: social players and score whores.

Russo graduated from Penn State in 1999 with a degree in “Integrative Arts”—a blend of advertising, visual design, and communications. He interviewed for a job at Megatouch as a “Photoshop whiz,” even though, as Russo tells it, he wasn’t qualified. He wasn’t familiar with Megatouch and hadn’t included any video game samples in his portfolio. Russo told me than when he was offered the job, his reply was, “Really?”

Megatouch has been around for 30 years, and before the ML-1, it targeted four broad types of players. There were the high-score chasers concerned with seeing their name in lights, social gamers who gather around the machine with friends, the loners who play to kill time, and semi-interested bystanders who play every so often, on a whim.

But players in that last group—“casual” gamers—have flocked to the iPhone and iPad, and any state with a smoking ban in its bars has seen a drastic decline in solo gaming. Rather than try to salvage the players Megatouch was losing, Russo and his team decided to redouble their efforts to attract the two customer bases they had left: social players and score whores.

The ML-1 is tailor-made for Russo’s new targets. Megatouch built a bespoke ML-1 network so that high scores could be viewed and conquered globally, and game updates are pushed from a central server—rather than the old system, which was a guy in a truck with an update disk, driving from bar to bar. The unit also solved some simple logistical barriers by building in a larger screen. If players want to crowd around and play a game together, at least now it’ll be easier to see.

Megatouch meeting

As Russo detailed these finer points of his machine, he became so engrossed in the minutiae that he unwittingly led our little office tour into the middle of a production meeting. About a dozen guys stood in front of a wall-size bulletin board that was divided into tiny sections. The board was peppered with squares of paper. This was Megatouch’s development slate—each of the board’s dozens of sections represented another game.

Russo led me directly through the meeting, with little hesitation in his stream of palaver, the same reserved grin on his face. Russo is so casually upbeat that when the next interview started—already crowded with art director Brian Kubala, lead designer Jay Aigner, and content manager Jim Hartman—Russo took a seat too, and no one really noticed.

In contrast with Russo’s zesty stylish flair (read: a tie), these three were dressed to hang out at the neighborhood bar for happy hour. Fittingly, they demonstrated a deep understanding of how Megatouch fares in a chaotic bar environment. These are the guys that sweat the company’s core dichotomy, creating games that are light and breezy yet have a nasty habit of getting under your skin.

All of Megatouch’s titles are designed to be three to five minutes in length. A play session always lasts that long, whether it’s the result of a player completing every level or, inevitably, losing. In each round of Photo Hunt, for example, players try to spot differences between two photos before time runs out, but time is cumulative from round to round. Faster players are rewarded with bonus time allotted for the next photo. Photo Hunt doesn’t indicate time with a clock, though. Instead, the countdown is graphically represented as a bar that changes color from green to red as it evaporates. As levels progress, the bar goes down more quickly, but you don’t even realize that Megatouch has overwound the stopwatch until it’s too late.

Dino Whiz

Dino Whiz

As art director, Kubala is responsible for the look and feel of every game. According to Kubala, Megatouch games need to be understood by the typical player within the first 30 seconds, and without the help of an instructional screen. Most players think they’re hot shit and blow right by any sort of how-to, anyway, assuming they’ll figure it out on their own. “Easy to learn; hard to master” is the old chess mantra, and while nobody is comparing the Dino Whiz champion to Garry Kasparov, the philosophy guides every game Megatouch produces. Games have to be inviting but not simplistic, challenging but protected by a learning curve that rewards you for slowly figuring the game out. It’s an elusive goal, but the company defines the success of its games by how quickly players pick up on them and how badly they want to play again as soon as they’re done.

Which is a long way of saying that Megatouch benefits when its players are addicted. That’s their word, not mine. When Kubala explained that Megatouch’s wares need to have “an addictive value,” everyone else in the room nodded in agreement.

Development at Megatouch is an ongoing quest for the pure gaming experience, defined as the game that leaves players hopelessly hooked. Games undergo rigorous testing in labs and in the field, and underperforming titles are canceled without remorse. The company also tries to ensure that both male and female gamers find something to play, although when I asked how that gender equality was achieved, the room went silent.

After a few moments, lead designer Aigner—who develops the concepts for new games—offered a tenuous explanation. “I don’t know how much this is officially supported by market research, but it seems the more action-y, intense games don’t fare too well on the female population, but the photo-hunting and hidden object games take off on that side,” Aigner said. With only one female developer and two female testers in the company, it stands to reason that this is something of a guess.

The memories of flops linger. Kubala mentioned one game that failed to take off, Space Farmer, and the entire room let out an agonized sigh. The room was quick to brush aside any follow-up questions about what made Space Farmer such a disaster. They didn’t want to talk about it.

The Megatouch ML-1

The Megatouch ML-1

The bartenders call them “crack boxes,” said Brennan McTernan, vice president of software. He’s the guy who makes sure every piece of software gets developed on schedule, including testing. “They get their tips and spend half on the machine.” McTernan is quite a bit older than everyone else at the office and hunches when he sits, like a guy who’s spent his life in front of a computer. He speaks with his fingers pressed together, using both hands to emphasize points, though they hardly need it. The crack analogy isn’t meant as a point of pride, or of shame. It’s simply a matter of fact. If Russo’s energy level is a seven out of 10, McTernan maintains a five point zero.

McTernan has a longer backstory than most other Megatouch employees: He came to the company six years ago by way of an Internet marketing company. Before that, he won two Emmys working at NBC on the 1988 Olympics in Seoul, overseeing software that could be used for real-time judging. His conversation style has an Olympian bent toward crisp, no-time-for-bullshit snap judgments. Megatouch’s business approach? “We’re trying to tempt people to put money in.” Megatouch’s mission? “Our primary job is to entertain drunks.”

On the other hand, lead programmer Austin Martin has the typical Megatouch prologue: He graduated from Full Sail University, a Florida school specializing in game design, and made his way to Megatouch a few years ago. (Full Sail grads make up 90 percent of Megatouch’s development wing and 60 percent of its testers; most are on their first post-graduate job.) Martin sees the inner workings of every game and talks about ways they can be tweaked to maximum effect. Flick And Kick started as a basic field goal-kicking program, but bar patrons tired of its simple mechanics. So Martin morphed it into a Space Invaders-type shooting game, replacing footballs and goalposts with blasters and aliens.

“Our primary job is to entertain drunks.”

McTernan and Martin were unfazed by questions about Space Farmer, the project so vexing that it reduced the other employees to stammers. Space Farmer originally called for players to direct animals to crop circles while simultaneously directing the alien ships to pick up said cows. Players didn’t like it. They found the task too complex at first, and conversely, the challenge became rote for those who bothered to figure it out.

Martin’s insight was to reshape the rhythm of the game. Instead of one continuous bovine-abduction frenzy, Martin’s revised Space Farmer broke the action up into discrete moments of chaos, so that the aliens and cows arrived in waves. Space Farmer suddenly made sense.

McTernan saw Space Farmer as a symbol of a dramatic industry shift. If Megatouch can make this game work, then surely there are plenty more where that came from. And the key was the ML-1. “Are you familiar with The Innovator’s Dilemma?” he asked me, name-checking the 2003 bestseller by business guru Clayton M. Christensen. If a company only listens to what its customers are saying, he explained, then they’re only hearing one side of the story.

Take the cell-phone industry. Customers said that they wanted smaller phones, better service, access to email, storage space for music, etc. Wireless carriers responded by cramming new features into their phones, eventually turning them into Transformers-like multipurpose devices. Then came the iPhone, and the idea of accessing your data anywhere with an expensive “smartphone”—something customers had not thought to ask for—became widely accepted.

Sure, the iPhone was a big step up technologically speaking, but the real coup was that suddenly Joe The Plumber wanted to stream Netflix movies to a tiny screen like he’s Joe Millionaire. He and all future iPhone owners have Apple’s marketing department to thank for this newfound urge.

Christensen’s term for this sort of feat is “disruptive innovation.” (Ten years ago, the fashionable buzzword would have been “paradigm shift.”) It has the potential to seismically change an industry, and usually comes in the form of a hot young industry upstart, just out for a taste of this hardscrabble world.

McTernan said that Megatouch, having essentially cornered the market, wasn’t content to wait around for its assassin. “For the past 18 months, we’ve made an effort to be our own disruptor,” McTernan said. By offering a new revenue-sharing business model—as opposed to the traditional approach of selling the machines to bar owners—McTernan hopes the ML-1 will reinvent the way customers think of Megatouch.

But it’s tricky to rewrite the rules of an industry if you also play by them. The ML-1 acts like an older unit with a bigger screen, slicker graphics, and the ability for Facebook-ness. The internet connection is new, but it’s the next logical step from what the company was doing before, not a disruptor. Megatouch isn’t Apple. Instead, it has to be Nokia. So it adds features to an existing device to modify the way drunks interface with it—but not too much.

When Photo Hunt Social HD became available for iPad at no cost, Russo emailed me a download link. “This is kind of a big deal for us,” he wrote. The game played the way it always has. It still built, second by second, to a point where my eyes were rapidly leaping from one photo to the next, and it still demanded I top my previous score as soon as I was done. It just looked a lot better than before. The transitions were flawless and graphically interesting, and the sounds had been given a decade-overdue upgrade, featuring really rich beeps and boops. Megatouch wasn’t disrupting anything. They were serving me another dish of Tastykakes.

That said, I played for a while.

Words by Steve Heisler. Title illustration by Keith Vincent. Photographs by Jenna Teti.

Correction, April 20, 2012: The original version of this story misstated that Megatouch creative director A.J. Russo compared the launch of the ML-1 to changing the felt on a pool table. The context was incorrect. Russo used this metaphor in reference to Megatouch’s development of new games for its devices; he was not referring to the ML-1 launch.