Niantic, the company Pokémon Go, has sold its division that makes third-party games to Scopely, a business owned by a Saudia Arabian company, for $3.5 billion. This includes Pokémon Go, Pikmin Bloom, and Monster Hunter Now, and all the location data of its users with it.
Pokémon Go has over 100 million players and needs users to share their location to work properly. This information is used both for game features and targeted ads. However, this is still data that shows companies where the users normally go, which is pretty intimate information. Niantic, a U.S. company, giving the location data of its users to another company doesn’t look good. It’s hard not to be concerned about the lack of information on what will happen to the location data that Niantic has already collected when there is no clarification on what will happen to the sharing data going forward.
This lack of clarity is common in the data monetization industry, especially regarding location data. There’s no hard and fast rule on how companies are allowed to collect, sell, and use data, and it’s not uncommon for a user to just agree to any document before playing a game.
The situation between Scopely and Niantic after the acquisition is not very clear. They call it a “partnership,” but it’s unclear how they’ll work together. There’s also uncertainty about whether data might be sent to Savvy Games or the Public Investment Fund of Saudi Arabia, which owns it.
Niantic decided to sell off its games division mainly because it was hard to replicate the huge success of Pokémon Go. Other games, like Harry Potter: Wizards Unite, didn’t reach the same level of popularity. Now, Niantic is separating its geospatial AI business, called Niantic Spatial, into a new company that Scopely invested $50 million into. This new company will use location data from previous Niantic games to create large-scale geospatial models. This proves there’s still an interest in making money from location data, just through a different company.
Although both Niantic and Scopely say they are committed to keeping the player experience positive in the long run, it’s hard to say that after playing games from Scopely. The company has a history of aggressive money-making tactics in its games. I play Monopoly GO frequently, and at least three pay screens are thrown at me the minute my dice run out. After one window closes, another screen pops up with the X on a different spot, asking me to pay for more dice. Sometimes, the X I just pressed is replaced by a purchase button that will rope me into a new screen if I press it again, thinking it will close the ad.
If I saw that same kind of aggressive tactic used in Pokémon GO or Pikmin Bloom, I’d quit them all over again. However, there’s no word on how much of the games will change after the buyout, but it’s likely the move to Scopely’s tactics will come in time.
The two biggest concerns from this deal are the changes made to the games by Niantic and what Scopely will do with the location data. The way historical location data is treated is serious. This data is valuable, especially when combined with geospatial AI technologies, and users should get clear information about how it will be handled.
Since users have already signed away their location data upon making an account for Niantic, it seems up to companies to be more open about it. Since those users technically gave away this data, the companies have no obligation to give away any information. So we’ll have to wait and see what will come from this deal.
