Niantic, the company behind popular mobile game Pokémon Go, has joined the growing list of companies downsizing their workforce. The studio recently announced that it would be letting go of 230 employees as part of an “organizational update.” In addition to the layoffs, Niantic also revealed plans to shut down its Los Angeles studio and cancel two licensed games: NBA All-World and Marvel: World of Heroes. However, the good news for fans is that Pokémon Go, the company’s flagship product, will continue to be developed.
In a letter to employees, Niantic CEO John Hanke explained the reasons behind the layoffs and studio closures. He acknowledged that the company had grown its expenses faster than its revenue, attributing this to the surge in revenue during the COVID-19 pandemic. However, once the pandemic subsided, Niantic’s revenue returned to pre-COVID levels, and new projects did not generate the expected revenues. Hanke stated that the layoffs were necessary to bring expenses and revenue back in line without endangering the success of Pokémon Go.
Despite the downsizing, Hanke emphasized that Pokémon Go remained a top priority for the company. He assured fans that the investment in the game and its development team would continue to grow. Pokémon Go was launched in 2016 and quickly became a viral sensation. It experienced a resurgence in popularity during the pandemic, as it provided an opportunity for homebound gamers to connect with the world outside their homes. Niantic even launched a social app for the game last year, allowing players to organize and chat.
One of the reasons cited for the downsizing was the slower-than-expected development of the augmented reality (AR) market. Niantic’s games, including Pokémon Go, were designed to take advantage of on-the-go AR experiences. However, the development of AR smart glasses, which would enable a more immersive AR experience, is still a ways off. The current wearable AR devices, such as Apple’s Vision Pro and Meta Quest Pro, are primarily suited for home and office use. While adaptations of Pokémon Go may work to some extent on these devices, Niantic’s vision for AR is dependent on consumer-friendly smart glasses that are not yet available.
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As a result, Niantic is adjusting its strategy to focus on building for emerging mixed reality (MR) devices and future AR glasses. Hanke mentioned in his letter that the company wants to concentrate on first-party games that embody their core values of location and local social communities. This shift in focus aligns with the company’s long-term vision of creating immersive AR experiences that go beyond what is currently possible with existing technology.
In conclusion, Niantic’s decision to downsize its workforce and cancel certain projects is driven by the need to align expenses with revenue and focus on the long-term development of Pokémon Go and future AR experiences. While layoffs are never easy, CEO John Hanke’s letter reflects transparency and a commitment to maintaining the success of Pokémon Go. Niantic’s dedication to embracing emerging MR technology and AR glasses shows their determination to continue pushing the boundaries of augmented reality gaming. Fans of Pokémon Go can look forward to new updates and features in the coming years as Niantic evolves with the ever-changing landscape of mobile gaming.
