Pokemon GO is set to become a significant contributor to the expansion of the global augmented reality (AR) software market, which will reach $30 billion in scale by 2020. So says analysis from global market research firm, Trendforce. Revenue from Pokémon GO alone is forecast to top $800 million in 2017.

With download and active user numbers far exceeding other popular apps, Nintendo’s Pokémon GO has generated an enormous wave of enthusiasm for mobile gaming and augmented reality (AR) technology worldwide.

“The popularity of the Pokémon brand and its character IP, rather than the AR technology, is mainly responsible for the success of this game,” said Jason Tsai, wearable device analyst for TrendForce.

“Other AR games that were released earlier did not resonate with consumers because they do not have the long and famous brand history that Pokémon has. Over a 20-year period, this title has built up a franchise that spans across games, films, anime, toys and other industries. In sum, the brand’s widespread recognition and its tens of millions of fans are the driving force behind this craze over Pokémon GO.”

He adds that Nintendo plans to generate value other than revenue from the game.

“Though Nintendo controls part of the Pokémon franchise and will also receive a share of the revenue, making profit from the game is not company’s primary, long-term goal. The real aim is to generate continuing publicity with the Pokémon brand using the AR technology and attract potential customers to other, even more valuable areas of the franchise such as theme parks,” Tsai said.

He also believes the game’s success will benefit the entire AR industry by encouraging further innovations in mobile based AR technology.

While some app developers may create knockoff games, those titles may not end up being a successful due to the lack of recognizable characters or poor game design.

Nonetheless, the proliferation of mobile-based AR games will increase consumers’ contact with the technology. People will eventually become more familiar with using AR apps for different activities. Besides spurring the creation of new AR game apps, Pokémon GO will help expand AR’s role in consumers’ everyday lives,” Tsai said.

www.trendforce.com