Pokemon Go, an augmented-reality mobile game, was a global sensation in 2016. What is the future of the trend?
Hiroshi Shibuya is walking along a path at Yoyogi Park in central Tokyo on a Sunday afternoon, occasionally stopping to hold his smartphone aloft. Despite an occasional sprinkle of rain, Shibuya, a bespectacled, clean-cut office worker, is one of dozens of people who venture out to play the popular Pokemon Go mobile game at the park.
"I come here almost every weekend. The game has made me walk around more often outside," says Shibuya, who declined to provide his real name. Shibuya says he joined the craze soon after Nintendo launched the app in July, even though he seldom plays video games at home.
One Korean couple from Adachi district, on the eastern edge of the Japanese capital, are also strolling around the park looking for Pokemon characters.
"I just wanted to take my wife out because she spends so much time at home," the man says. "We went to other parks in order to play it."
Pokemon Go lets players "go outside in the real world and catch a Pokemon," Nomura said.
The augmented-reality (AR) mobile game, which was a global sensation this year, lets players search for computer-generated Pokemon characters around real-life geographical locations.
Pokemon Go is a game of metadata, as information about the real world is overlayed with other information.
When game developers attach metadata to digital data, such as bar codes, image data and sound waveforms, that "could open up the possibility of new games," Hirabayashi said.
The estimated total number of Pokemon Go downloads is expected to reach around 500 million by the end of 2016, according to Juniper Research, a market research firm in Britain.
The number of other AR game downloads will be about 17 million by the end of the year, Juniper Research estimates. "We hope there will be more of this type of games coming out," Nomura said at Spikes Asia.
Analysts expect the number to increase drastically in the coming years since AR games require lower production costs than virtual reality ones. Virtual reality games require a bulky headset and a special filming procedure and editing work.
Some AR games are likely to reach beyond existing game fans and expand the market, analysts say. Pokemon Go has attracted some, like Shibuya, who were not previously avid gamers.
"The Pokemon Go game even enabled some people who are afflicted with depression to go out and play it," says Yuri, a nursing school student in Tokyo who declined to provide her family name.
Juniper Research forecasts the market for augmented reality will grow from 515 million dollars in 2016 to 5.7 billion dollars in 2021. The majority of revenues comes from license and subscription fees and is expected to continue to do so, it says.
Nintendo released Pokemon Go Plus in September, a new accessory that alerts players when a Pokemon is nearby and lets them try to get it.
The number of Pokemon Go players has dwindled since its launch, analysts say, so Nintendo is trying to lure them back. Fans are expecting more surprises from the game maker before Christmas.
Sony is also keen to play an active role in mobile gaming fields. It established a subsidiary called ForwardWorks in April. The consumer electronics giant wants to broaden its customer base by letting users play PlayStation games and others on smartphones.
"Pokemon Go is a real game-changer," Sony chief executive Kazuo Hirai told the Financial Times in September.