Short answers, pulled from the story.
Sega released Periscope in 1966 as an electro-mechanical game that used lights and moving parts to simulate a submarine attack. This machine marked the beginning of a shift from simple mechanical amusement devices to complex electronic entertainment systems.
Nutting Associates introduced Computer Space in 1971 which was designed by Nolan Bushnell and Ted Dabney. The machine was demonstrated publicly at the Amusement & Music Operators Association show that October alongside another early prototype called Galaxy Game at Stanford University.
Taito released Space Invaders in 1978 which triggered a massive expansion in the arcade industry across North America and Japan. By 1982 dedicated video-game arcades had multiplied in storefronts and shopping centers as demand surged following this release.
Sega led the charge into real-time three-dimensional graphics with titles such as Virtua Racing and Virtua Fighter during the early 1990s. These games utilized polygon-based rendering techniques that were far more advanced than anything available on home consoles at the time.
The decline in Western markets began around 1997 when console graphics and affordability outpaced what arcades could offer. Despite this divergence Japanese operators invested heavily in custom hardware and innovative gameplay mechanics that kept their industry robust.