Niantic, Inc.: Pokemon Go and the Rise of Augmented Reality Gaming

In the summer of 2016, the unprecedented growth of Pokémon GO introduced augmented reality into mainstream gaming. Pokémon GO was developed by San Francisco-based Niantic, Inc. (Niantic), a highly successful spinoff from Google Inc., which partnered with the Japanese video game company Nintendo Co., Ltd. to bring the popular video game franchise into the mobile gaming sphere. Niantic's version included the innovative use of augmented reality, a technology that merged artificial reality with the real world. Although this strategy was a fresh approach, it also presented risks. Niantic was determined to shut down cheating apps and websites that were overloading the company's servers and giving some players unfair advantages. Some players were dismayed by Niantic’s actions and by the apps and websites themselves, while others predicted that the game's popularity would disappear as quickly as it had grown. By late 2016, Niantic needed to decide how to move forward. Should Pokémon GO continue to evolve as an augmented-reality game, with teams and live events, or should Niantic create a new gaming experience focused on features from the original Pokémon games? Alternatively, should the company partner with third-party developers, including those that had developed popular cheating apps and websites? Finally, how should Niantic fund its unexpected growth?

The case is suitable for undergraduate and graduate courses in marketing strategy, particularly those that emphasize entertainment and technology. The case introduces students to the use of mobile games to promote a franchise. After working through the case and assignment questions, students will have developed their ability to do the following:<ul><li>Identify and explain the challenges of market forecasting, particularly for technology start-ups.</li><li>Outline the challenges and opportunities of a new technology such as augmented reality.</li><li>Describe the product life cycle of new technologies, particularly fad-driven video games.</li><ul>

• product life cycle, venture capital, market strategy, startups