Location is built in to mobile experiences and the masses are using location-based apps daily for almost everything. The progress has been enormous: There is now a mass market platform for location based services available as well as global app distribution. In addition to that the mobile gaming industry has matured to a $30 billion dollar industry.
We have gotten so used to our smartphones knowing our location that it is very difficult to imagine how we would live our lives without them. There are location-based apps for everything: Navigation apps help you find the fastest route to your destination, recommendation apps will find you the best place to eat and you can even find your friends who are close by with a proper app. Location is built in to mobile experiences and the masses are using location-based apps daily. Pokemon Go introduced location-based gaming to the masses in just a few months. The game was released in July 2016 it has broken multiple app store records including fastest game to reach $500 million in revenue (in 60 days!) . It seems this happened overnight, but there were three key developments that made this possible. First, there is now a mass market platform for location based services available (the smartphone), second, there is global app distribution available and third, the mobile gaming industry has matured to a $30 billion dollar industry. Let’s look briefly how we got here.
Going back a decade we see a very different world: apps are not easily available, most phones do not have GPS and data connections are slow in general. In the coming years, three key developments changed everything: First, Apple Appstore was opened in July 2008 and the world got to know apps  and developers finally had mass distribution to consumers. Iphone 3G had GPS built in, and all other smartphones followed suite. Finally – the data connections got speedier every year and in less than five years we got from the point where some people had a special device for location-based applications to a point where everyone had a platform for location based services. For mass market products, the technology adoption was done. Google maps is the best example of an app that is being used by millions daily.
Mobile gaming tremendous growth also starts from the introduction of Apple Appstore. The first global super hit game was Angry Birds, the fantastic game that has seen more than 3 Billion downloads on the series games . The game initially cost a dollar, and it became a huge hit across the globe. After Angry Birds, the mobile gaming focus shifted to free to play games (F2P) where games are free but there are in application purchases that the players can make at any time. Companies such as Supercell have made games that have earned billions of dollars. This business model has proven to be hugely successful making the mobile games market the $30 billion behemoth it is. And it is still growing.
In short, Pokemon Go success has been made on three key developments: a mass market platform for location-based games, mass distribution of applications and the maturation of the mobile games business model. And it has been a success nobody could have anticipated. If we go back to the record I mentioned earlier – Pokemon Go reaching $500 million in 60 days – and compare the number to earlier attempts by industry giants we can see how the industry develops. Clash of Clans (Supercell, 2012) needed over 400 days to reach the same milestone and Candy Crush Saga (King, 2012) needed over 200 days. Pokemon performs better than the best, that is no easy feat.
Location based games were not invented by Pokemon Go, but they have been around for more than a decade. It has not been an easy ride for the pioneers. One of the oldest released location based games was BotFighters by “It’s Alive” (2001) . It was a PvP game played on top of the real world. An early game that used collection as key element (as in Pokemon Go) was Mogi (2003) by Newt Games . These early games were released well before the location-based applications had mass market adoption in devices or the apps had easy distribution via app stores. These were fantastic games, but many things needed to change before the people were ready. More recently, there has been many interesting games in the market. Shadow Cities by Grey Area labs was released in 2010 , when the market penetration for location based devices was still fairly low. The game was popular among its players, but it was still a little early in the market. Ingress  was released at the end of 2013 and it was developed by the same company as Pokemon Go, Niantic. The game is still running and the data in the game helped to create the world in Pokemon Go. It has been a slow and steady rise but now we can say location-based apps are on top of the world.
I expect a lot of new and interesting games to enter the market and we in Lume Games are developing one. We are currently testing our new game Everherd that is a location- and weather-based animal collector and town builder. We are developing a more casual experience than Pokemon Go where players can play very short sessions multiple times a day. We also want players to always look outside wherever they are – our game reacts to the weather and in different weather conditions different animals come out. We want rain to be a great event in the game.
With a lot of trial and error, the maturation of both the hardware and app distribution ecosystems we have gotten to this point: A single location-based game is the most profitable application in the world. As I claim in the title, there has never been a better time to make location-based games. Pokemon Go is leading the way and location-based games are no different to the mobile games industry: there is room for many successful games out there. The market opens now and I am very excited to see the great games in the coming years.
Final note: Pokemon Go also has Augmented Reality at the heart of the experience when catching new Pokemon, but that is a subject to another blog post.
About Lume Games and author
Lume Games develops Mixed Reality games that use location, weather and other pieces of information to offer fantastic games to players. Our new game, Everherd, is in soft launch and it has been developed with the support of CreatiFi and FIWARE technologies.
Riku Suomela is the CEO of Lume Games. He’s been part of location-based and Mixed Reality gaming from 2000 when he was a fresh research scientist to today when a location-based app is #1 grossing on the planet.