Everyone is talking about Nintendo being a huge winner with the recent success of Pokemon Go and with good reason. Nintendo’s stock price has seen a huge increase since the recent Niantic release. What many people are lacking to see is who is really profiting and will continue to do so, Google aka Alphabet.
Google recently went through some corporate restructuring to add more transparency to shareholders and changed their corporate name to Alphabet. Before doing this they spun-off Pokemon Go creator Niantic into its own private company. I won’t go into detail about all the reasons why this made sense for both companies, but just know that it did. Here’s the kicker, after the spinoff Nintendo and Google invested around a total of $20 million into Niantic.
Google’s return on their investment in Niantic has the potential for huge profits! As it stands now they are making money every time there’s in-app purchases. Let’s not kid ourselves, if that is all that Google would render from this investment they wouldn’t have invested into Niantic in the first place. Pokemon Go makes use of Google Maps to help guide its players throughout the real/virtual world. This is going to help Google continue to curate and make their Maps program the best. Google also sells ads and does so very well. Niantic has mentioned using sponsored Pokestops to generate ad revenue and Google can facilitate this like no other. In the future when you take a long walk to a Pokestop that is right by a Taco Bell, will this be a coincidence? Google will let you think that it is, but that’s why they’re the behemoth that they are, and why they are the real winners of Pokemon Go.