San Francisco-based augmented reality (AR) gaming company Niantic is reportedly in discussions to sell its video games division, including its flagship title, Pokémon Go. According to a Bloomberg report citing sources familiar with the matter, the deal could be finalized in the coming weeks. However, the sources also caution that there is “no assurance” the discussions will lead to a definitive agreement.
The Rise and Challenges of Niantic
Niantic, originally founded as an internal unit within Google in 2010, became an independent company in 2015 when Google restructured under Alphabet Inc. The company struck gold in 2016 with the release of Pokémon Go, which quickly became a global sensation. Players use their mobile devices’ GPS to explore real-world locations, capturing and training virtual Pokémon in an AR-driven gaming experience. The game remains the most downloaded and profitable AR app to date, according to Niantic.
Despite its continued success with Pokémon Go, Niantic has struggled to replicate this triumph with its other gaming ventures. Titles such as Harry Potter: Wizards Unite failed to gain significant traction and were eventually discontinued, with the Harry Potter-themed game shutting down in 2022. Additionally, the company had to cancel several in-development projects and lay off employees as part of cost-cutting measures.
Potential Shift in Focus
Should the sale go through, Niantic is expected to pivot its focus toward its geospatial technology and AR-based infrastructure. The company has been developing a “large geospatial model,” which it describes as a positioning system built on player data gathered through Pokémon Go. Niantic has long envisioned a future where spatial intelligence becomes integral to wearable technology and real-world digital interactions.
“As we move from phones to wearable technology linked to the real world, spatial intelligence will become the world’s future operating system,” the company previously stated. The potential sale of its gaming division suggests that Niantic may now be concentrating on this vision rather than traditional mobile gaming.
Savvy Games Group’s Growing Influence
The possible buyer of Niantic’s gaming division has not been confirmed, but one strong contender is Scopely, a mobile game maker owned by Saudi Arabia’s Savvy Games Group. Savvy Games Group is a subsidiary of the Public Investment Fund (PIF) of Saudi Arabia, which has been investing heavily in the gaming industry to establish itself as a global leader in interactive entertainment.
Last year, Niantic and Savvy signed a deal aimed at expanding the AR gaming market in Saudi Arabia, the United Arab Emirates, and Egypt. This partnership suggests that Savvy Games Group may be a natural fit for acquiring Niantic’s gaming assets, allowing it to further strengthen its foothold in AR gaming.
What’s Next for Niantic?
As negotiations continue, the future of Pokémon Go and Niantic’s other gaming projects remains uncertain. If the deal proceeds, it could signal a major shift in Niantic’s business strategy, positioning it as a leader in geospatial technology rather than gaming. Meanwhile, Savvy Games Group’s involvement in the industry continues to grow, making it a key player in the future of AR gaming.
For now, Pokémon Go fans and industry observers will be watching closely as discussions unfold in the coming weeks.
