Pokémon GO: Nintendo on the Rise Again?

Pokémon Go; the wildly popular game these days has captured the eyes of many. The game was launched in Australia, New Zealand and U.S. on 6 July, 2016 successfully and Nintendo’s shares skyrocketed in value by more than 30% in just a few days after it. It has been gradually made available in more than 30 countries worldwide since then; including UK, Italy, Spain, Germany, Belgium, Hong Kong, Canada, Greece and Netherlands.

The game has been developed by Niantic Labs; a Google spinoff company. Niantic Labs was founded by John Hanke, who at the time was employed in Google working as the Vice President of Product Management for the company’s “Geo” division (Google Earth, Google Maps, Local, StreetView, SketchUp, and Panoramio). Niantic Labs already had experience in developing Augmented Reality (AR) based games with “Ingress” which was launched on December 14, 2013.  Ingress utilized the same technology as Pokémon Go and the goal was for players to use their devices to capture landmarks to increase their faction’s territory. Ingress was very successful as well; having more than 14 million downloads since its release while possessing a large player-base active in more than 200 countries.

Pokémon Go uses the device’s built-in GPS to track the player’s movements in real-time and displays it on a custom version of Google Maps. The map also displays the location of random Pokémon that spawn from time to time. The player has to move (yes, like walking or running) to the specified location on the map to capture them (while maintaining a working Wi-Fi/Data connection). Furthermore, the device’s camera can be used for AR; a feature, which lets players search for Pokémon whenever they’re in the range of one by pointing the device’s camera in the right direction. There are currently 250 different Pokémon available in the game for players to capture and many Poké Shops placed around the player where they can get useful items. It all sounds well but if you want to play Pokémon Go on your device then you will have to say goodbye to long battery life. The use of GPS and Wi-Fi/ Data Connection (3G/4G) simultaneously is very taxing on the phone itself but with the added occasional use of AR, the battery won’t last long.

Regardless of the issues with the game, it has been estimated that Pokémon Go has more than 15 million downloads in the U.S. only. It was launched in Japan on 22 July, 2016 with 10 million downloads estimated on the first day only. These are estimates only as Apple and Google don’t reveal the actual data for downloads publicly but they are still somewhat accurate. While this has also resulted in a sharp rise in the value of Nintendo’s shares, the company does not deem it as unexpected. In a statement released after the launch of the game in Japan, Nintendo announced that it owned only 32% shares of The Pokémon Company which means that not all the profits will be going into Nintendo’s pockets. In April, 2016 it was also announced that the earnings from Pokémon Go had “already (been) factored into the Company’s consolidated earnings forecast.” Following the announcement, the value of the shares dropped from very high to lower and more stable rates. It seems that the rise, in the first place, was fueled by the investors’ misdirected belief that Nintendo owned the Pokémon franchise when in reality it only holds a part of it.