The Royal Ballet, O2 Arena, London

Two houses, both alike in dignity...first Covent Garden and now the

It isn't the surround-sound munching or the comings and goings with beer.

It isn't the presence of entire families, including the odd babe in arms. It's the distance that keeps reminding you where you are. The seats furthest from the stage in the O2 arena are three football pitches from the action. Even from the "best" spots, where they had put the ballet critics, naturally, the performers are so tiny that your gaze repeatedly flicks to the three screens showing close-ups, and eventually stays there for the duration. If there is a loser in the Royal Ballet's first major foray outside the Royal Opera House, it is liveness. The winner, surprisingly, is Prokofiev.

Posted into a letterbox-shaped hole in the wall above the stage, the Royal Philharmonic Orchestra – under the Royal Ballet's excellent Barry Wordsworth – delivers the 20th century's greatest ballet score with a sonorous expansiveness that penetrates bone. It's amplified, of course (a no-no at Covent Garden), the lower voices given extra welly, as in a rock gig. Those massed trombones have never sounded more accusatory or more terrifying in the final scene in the crypt.

Officially, the stage the RB erected at one end of the giant oval is identical in size to Covent Garden's, but it seemed much bigger. Never before has Juliet had to run a half-marathon to reach Friar Lawrence's cell, or crawl so agonisingly far to die by her Romeo's side. There were benefits, too: Romeo's barrelling leaps in the balcony scene could really let rip with elation. And all that charging about in Verona's town square by the locals had a fresh-air freedom that wasn't forced.

Acting-wise, the stars faced a dilemma. Do you big up the gestures to match the space? Or do you go super-subtle, knowing that your face is being magnified on a 20ft-high screen? Carlos Acosta and Tamara Rojo chose stripped-down and streamlined, and it worked. Their one-on-one scenes – the balcony, the bedroom – were as potent as ever they've been, the sound of 12,000 people holding their breath proof of that. Only afterwards could you tell the effort it had cost. Both stars looked wrung out at their single curtain call. (There being no curtain anyway, they kept it short.)

But for all its supposed familiarity, the story suffers. Much of the narrative action happens in mid-focus scenes where key business is transacted among a throng: think of the illicit locking of eyes at the Capulet ball, Juliet's nurse delivering her letter to Romeo on the crowded piazza, the dangerous street games of cat and mouse that erupt into fatal gang war when one side goes a taunt too far. Artfully prepared video segments shown during scene-changes helped a bit (all credit to the BalletBoyz, Michael Nunn and William Trevitt). Live, the eye struggled to pick out who was doing what to whom in a crowd.

If the Royal Ballet is going to try this again (and it will, if ticket sales are the decider), it will have to re-think. Swan Lake would have semaphored its qualities better in the present set-up. Eventually, though, productions will have to be refigured for the demands of an arena – done in the round, the distance wouldn't be an issue. English National Ballet clocked this long ago, and it was odd that, in the mass of publicity preceding the Royal's O2 debut, no one asked Tamara Rojo about the time she danced Juliet for them in the Albert Hall 13 years ago, albeit in a less potent version.

For all its miscalculations of scale, the Royal serves Kenneth MacMillan's 1965 choreography superbly. Whether the choreographer's widow will ever allow it to be tampered with for in-the-round consumption is unsure. What's certain is that Kevin O'Hare, announced last week as the new artistic director of the company from July 2012, will already be planning how to capitalise on the vast new audience – in the tens of thousands – brought to ballet in the past two days.

Final performance at the O2 is at 3pm today (020-7536 2600)

Dance Choice

Turner Prize-winner Martin Creed is more familiar in the Visual Art slot, but his Work No 1020 uses music composed by Creed and played by his band, and is performed by five dancers restricted to using only the five core classical ballet positions, each ascribed a musical note. Inventive, intriguing and often funny. (Sadler's Wells, London, Tue).