Microsoft CEO Satya Nadella says the hugely successful Pokemon Go app, which has millions of people chasing down monsters on real-world streets using their phones, is a phenomenon that spells good things for his company’s augmented-reality headset, the HoloLens.
“I think it’s fantastic to see these augmented-reality applications getting built, because the best thing that can happen when you’re creating a new category is for applications that are these killer apps, whether it be game or in the industrial scenario, to get invested in,” Nadella said.
Microsoft has already made a point of demonstrating the potential for gaming in augmented reality, with impressive HoloLens demonstrations that transform living rooms into combat zones and that bring the world of Minecraft to your coffee table.
Nadella was speaking alongside Jeffrey Immelt, the CEO of General Electric, who agreed that the Pokemon craze — just barely a week old — is a clear indicator of the potential for augmented reality to break through. Beyond gaming, both Immelt and Nadella expect augmented reality to have a transformative effect on industry in the coming years.
Apple Earns 3X nintendo on Pokemon GO
A report by Luke Kawa for Bloomberg noted that the game already has more active users than Snapchat or WhatsApp, having rocketed to the top of the App Store charts at a record pace.
The report cited Macquarie Capital Securities analyst David Gibson, who noted, “As users build their Pokemon inventory, spending money becomes needed to store, train, hatch, and battle.”
Gibson stated that “we presume that out of every 100 units earned at the App Store, 30 would go to Apple, 30 to [software developer] Niantic, 30 to Pokemon and 10 to Nintendo.”
Apple earns a 30 percent cut of App Store sales and IAP, collected to help maintain and enhance the market for iOS software. App Store sales are a major part of Apple’s Services segment, which experienced 20 percent growth in the March quarter, bringing in high margin revenues of $6 billion.
Google Alphabet owns Niantic which built the Pokemon Go App
Nintendo — which does not charge users to download the app — makes money by charging users a small amount of money for widgets that speed up the game or otherwise make it more interesting.
Another feature of Pokémon Go is the concept of a gym — a specific location — an old church in Holyoke, Mass. — where players who reach Level 5 in the game must train the Pokémon characters that they’ve captured, noted the Times.
Restaurants or bars might decide to pay Niantic to be sponsored Pokémon Go gyms in exchange for which they might get lots of customers buying food and drink.
But the ultimate economic beneficiary of Pokémon Go’s popularity — SimilarWeb notes that people spend 43 minutes a day there – more than Instagram or WhatsApp — may be Alphabet since Niantic built the game using its digital mapping services, according to the Times.
To be sure, it is difficult to estimate how much revenue games like Pokémon Go will add to Alphabet’s revenues — but the uncontrolled popularity of this game is likely to spur hoards of developers to build new AR games using those digital mapping services.
SOURcES- CNET, Youtube, Apple Insider