No doubt they will be in arcades in bigger ways much like arcades today have more physical and accessorized games than you can have at home (racers with seats, bikes, guns to use, skee-ball like games etc), but the home experience will be great because most markets are open now and anyone can publish. Content will move very fast. Plus, just like touch pads, VR headsets are pretty nasty after a while if they are used…
I'm hoping against hope for the middle-way between those two, though: rentable holosuites, like the VR equivalent of computers at internet cafes, where there are a few titles preinstalled, but you can also run whatever titles you like from the 'net.
(Or maybe it'll just let you log into your Steam account, where all your VR games and apps are. I could totally see Steam as becoming to thin-client VR as Windows is to thin-client PCs.)