What does the Pokémon Go craze really mean?

Here are ten quick thoughts, especially on the augmented reality (AR) angles: does the success of PG mean that AR is at a tipping point? (As always, I have no view on the stock market implications.)

1) It is definitely a hit. But comparing the number of daily average users (DAUs) to Tinder or Twitter doesn’t make sense; we should be measuring it against other successful mobile game titles. Pokémon Go has been downloaded about 7.5 million times, and let’s assume that 6 million are playing it daily, which is likely high, but we are early in the adoption cycle. Our old friend Angry Birds had over 30 million DAUs at one time, Clash of Clans was over 100 million DAU, and the record holder seems to be Candy Crush Saga, which had 158 million people PER DAY playing it in Q1 2015. Although PG has yet to launch globally, it is clearly not yet in the “big leagues” for mobile games.

2) But will it have ‘legs?’ Many games come out, peak quickly, but then see numbers drop again almost as quickly. Others have much greater longevity or retention as they call it in the gaming business. Retention is defined as the percentage of people who played your game in Month 1 also play it in Month 2. Losing more than half of your players in the months after launch is normal: only 16% of games have Day One retention rates higher than 50%! We just don’t know yet what Pokémon Go retention will be – my own guess is that it will likely have slightly lower retention than average for some of the reasons below.

3) The time of year matters: this is a great summer game. I suspect it will do less well when the weather gets colder or wetter. #CatchACold isn’t nearly as fun as #CatchEmAll!

4) This may be more about how much people love Pokémon than how much they love Augmented Reality. There are a number of other similar AR mobile games , and none of them have seen this kind of success. Ingress (an earlier game from the makers of PG, and without the AR overlays) had about a million monthly average users.

5) It is hard to overestimate the laziness of human beings. Yes, people are running around and trying to “catch ‘em all”, which is great for fitness: one woman said her pedometer measured twice as many steps in a day while she was playing! But, as we know from fitness bands, the drop-off rate for gamifying physical exertion is high. People do it for a few days, then turn back into couch potatoes! 😦

6) The most popular smartphone games tend to be casual time-fillers. You can play for a minute or two while in a line-up, or on a bus. Pokémon Go requires more of a time commitment – early data suggests that the average player is spending over 43 minutes per day in the game. That is amazing engagement, but likely to appeal only to a fairly narrow slice of serious gamers.

7) Some people are saying that this will be big for Augmented Reality in general. I don’t think that there is much evidence for that. Playing with your phone in a limited AR way is good, but how will that translate into AR headsets? Or into non-game AR content? Or into non-Pokémon AR content? All good questions…

8) A lot of smart futurist-type people and forecasters have been saying that AR will be the next big thing since 2010. They have been badly, embarrassingly wrong so far. And I think some of the buzz around Pokémon Go is from AR-boosters pouncing on this first success like a drowning man grabbing a life-saver.

The success of Pokémon Go means that at least some people, for some period of time, will actually use and enjoy using augmented reality for certain kinds of content. We didn’t know that before, so this is definitely meaningful new information.

But whether this is a bellwether for ever-increasing growth in the AR market is unproven in my view. Critically, most of the AR advocates have been pushing AR headsets of late, not the mobile phone overlay version. I don’t think the success of Pokémon Go does anything to suggest that people will also be willing to wear expensive, heavy, obtrusive headsets.

9) It is worth noting that Pokémon Go is unusually VISIBLE. Tens or hundreds of millions of people can and are using their smartphones to hurl birds at pigs, be ninjas with fruit, or drive around Hollywood with Kim Kardashian. But unless you peer at their little screens, the game playing are not being thrust into your awareness. In contrast, even a few dozen people gathered in one spot in Central Park makes headlines. (Which I find slightly odd: I have been to Central Park, and it has well over 100,000 visitors per day in the summer. Why make a fuss about a few dozen playing Pokémon?) I would argue the impact of Pokémon Go is being exaggerated to some extent by the extremely public nature of the game.

10) There are lists of issues that are getting written up: people getting robbed, walking into traffic, security issues around the app, draining your battery, or even using up data. (The last is not a big deal: PG uses about 10 MB per hour of play.) I think these are all fairly minor points, and will not be significant long term factors.

My conclusion?

I think AR in mobile gaming will be very similar to motion control in console gaming. The Nintendo Wii showed that motion control was a real market, and a profitable market, with tens of millions of people trying it and using it. But it reached a quick peak, and then fell rapidly from that peak: see chart below. Critically, it NEVER became the way that most people played games. It was an alternative, but always a small piece of the pie. I suspect AR in gaming will be the same. And motion control never crossed over from console gaming into how we interacted with our TV sets or computers…despite many companies trying to make that transition.




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