Try to make that Cafe near some
Engineering Hostels(Pvt. Colleges proffered) or something. That always works wonders.
About the concept, Ive seen many such businesses come up in Chandigarh, do amazingly good and then after a year or max 2 years of craze, just fade out. Just like that.
We had
2 Zapaks here, which were totally awesome for that time. 100 Bucks for 3 Hours, basic gaming hardware cheap GPUs small monitors but a damn fast internet. People usually came for DOTA WoW and CS anyways so that didnt matter.
But then both of them shut down even when they both were super successful, INITIALLY. It COULD BE that the profits they were earning thinned down at the end.
Okay now next we had was
Oxide(still here), it had 3 PS3s, 2 XBOX360s and a Nintendo Wii. Small place but amazing decor and Furniture. 46 Inch TVs. It was super exciting, but again, only initially. It was hot but then again the craze thinned down.
They charged 180 for 1 person and 240 for 2 per hour, so QUITE expensive.
Then we have
Indulgence, a super big place, TOTALLY gaming oriented stuff, Big 3D TVs with Mid Range computers hid under super expensive PC cases(games ran at low/medium), amazing gaming theme decor, maybe 14-15 computers but again super expensive, and this place never kicked off. It had a somewhat okay start but again the craze just went away.
Now we have this place called
Octopus Gaming.
Whats great about this place is that its a small showroom on the first floor, nothing fancy, BUT Great PCs(Most have AOC 23 inch monitors and 3 have 27 Inch ones) 4 having HD5450 graphic cards and the others having HD7750, and not sure but atleast an Athlon or Pentium Dual Core in all of them. Internet is super fast too. ANNNNNNDDDDD Only Rs.75 per hour!

Whats best is that on request the guy offers you 9 PM to 4 AM gaming, 1 Big Chips pack, 1 Coke bottle all under 350 Rs per person IF you manage to bring atleast 10 People!

Me and my friends have had about 4 night outs here, the guy is super awesome and nice and often plays a game or two with us.
Now see,
Zapak MAY have failed cuz it was a BIG establishment with a BIG investment which didnt give enough profit. (Zapaks were all over India and the bigger one in Chandigarh had around 30 PCs)
Oxide is slow cuz MAYBE the stuff they have is just for Casual gamers (a market which now has iPads and iPhones and Galaxy S3/S4s which can full full their Gaming needs) and it was just too fancy for a gaming place. Also not that cheap so gamers could always BUY a PS3 if they were rich enough to play there OR just go to the local (although illegal

) PS3 VideoGame booth.
Indulgence, too high investment, targeted only super rich people or hardcore gamers, who could always buy the same Hardware at home and play the same games for much cheaper and also, convenience.
But this
octopus place is new. Its not really THAT hot but its pretty good. Every time I visit(cuz its cheap) I find a few 'Regulars' over there playing CS or COD4 or WoW with their own Gaming mice and mouse pads . Although I still cant be sure if its really that profitable but from what the store guy (not the owner, just a manager) told me the owner is planning to open 2 such Gaming Cafes around Chandigarh in the Richer single digit Sectors.
I hope all this somehow helped and you can gain a thing or two from here. Best of luck!