Nintendo ‘Pokémon GO’ Creating an Augmented Reality Craze

Nintendo added $7 billion in market value since debuting “Pokémon GO,” its location-based, augmented reality mobile game that it says has attracted more than 10 million players in its first month. The game takes users away from videogame screens and out into the real world where they search for virtual monsters in parks, historical monuments and even police stations. While gamers excitedly take to the streets, reports have recently pointed to distracted players falling into holes, walking into street signs, and even being robbed by criminals using the location tech to locate their prey.

Currently available only in the U.S., Australia and New Zealand, “Pokémon GO” was developed by former Google startup Niantic, which also involves location-based gameplay.

Bloomberg reports that the free game recreates Pokémon’s story of players looking for “pocket monsters” to train and do battle with one another. Some reports have said that players using location tracking to find new monsters have been “taking road trips and even renting boats to get to hard-to-reach destinations.”

Pokemon_Go_AR_Logo

App Annie says the game is No. 1 on Apple’s free-to-download app charts in both the U.S. and Australia since its July 7 release.

On Monday, stock trading in Tokyo jumped “as much as 25 percent,” a reflection of investor confidence that Nintendo will be able to monetize this hit and similarly exploit its other properties. That belief is bolstered by Nintendo’s announcement that the app “will serve as a communication platform and a portal for its games on mobile devices and consoles.”

“Clearly Nintendo has managed to pull off something very special that has created a craze in the mobile gaming market in matter of days,” says BGC Partners exec Amir Anvarzadeh. “This game may not be big enough to move the earnings dial in the short term but sentiment-wise it could prove very potent at this stage for Nintendo when hopes of major success on mobile have been very deflated since last year.”

Anvarzadeh also notes that, “Although the game is free to download, it looks well structured to potentially monetize on its early success through in-app purchases.” In fact, Nintendo already has plans to debut a related “plastic wristband device that will alert gamers to Pokémon activity.”

The “Pokémon GO” hit comes at a good time for Nintendo, which is “forecasting sales of Wii U and 3DS player to decline this fiscal year, while its next-generation NX gaming device won’t debut until 2017.” Miitomo, the company’s first smartphone app, debuted in April and quickly plummeted from top ranking.

Related:
Why Pokémon Go Is an Even Bigger Game-Changer Than You Think, BGR, 7/11/16
Hunt for Pokémon Has Led to Painful Discoveries, The Wall Street Journal, 7/11/16
Pokémon Go Brings Augmented Reality to a Mass Audience, The New York Times, 7/11/16
Pokémon No: Suspects Believed to Have Used ‘Pokémon Go’ to Rob Players, Digital Trends, 7/11/16