The game became a social phenomenon, with adults and children gathering in parks and public areas to train their Pokémon. The fad is still going strong, with new characters and upgrades being added regularly. More than 65 million people use the app each month, although it’s down from a peak. In the U.S., the game is among the 20 most-lucrative apps this year, holding the top spot for about a week in July.

For the companies behind Pokémon Go -- Niantic Inc., Pokémon Co. and Nintendo Co. -- the game has been an earnings bonanza, with revenue estimates ranging from $1.5 billion to $2 billion. Nintendo has reported 23.6 billion yen ($215 million) in income from equity stakes in other companies, the bulk of which came from its partial ownership of the Pokémon company.

Tsunekazu Ishihara, chief executive officer of Tokyo-based Pokémon, says this is just the beginning. He sat down with Bloomberg News to discuss the future of the smartphone title, Nintendo’s Switch gaming machine and his company’s upcoming Pokémon game for the new console.

Read also: Pokemon Go still going strong despite drop in player base

Pokémon Go

Earlier Pokemon games spanned titles on Nintendo’s portable handheld players as well as trading cards, cartoons, comics and toys. That created a rich pop-culture history and consumer affection that the smartphone title has tapped into. Ishihara has bigger plans for Pokémon Go, including the ability to trade the virtual monsters and battle one-on-one -- key features seen in other Pokémon-based games. While others have mentioned these might be coming, this is the first confirmation by the company itself. By adding new elements to the game, Ishihara is betting that people will keep coming back to play to discover new things. 

• “We’ve only accomplished 10 percent of what Pokémon and Niantic are trying to do, so going forward we will have to include fundamental Pokémon experiences such as Pokémon trading and peer-to-peer battles, and other possibilities.”
• “Depending on location, there are many Pokémon with different characteristics. So what do we do with those and the real world? One view is to have chilly Pokémon in a cold climate, but then that would also mean that people born on a tropical island won’t be able to catch them. So we are always thinking of how to find the right balance between game design, how our Pokémon should exist, and how players feel about their collections.”
• “Right now, if you go to the coast you can catch water Pokémon. For example, if you have a setting for electric-type Pokémon (such as Pikachu) to appear at power plants, is that really a good idea for you to find one in such a location -- is it safe, and is it OK regionally? We see it as a very realistic problem.”
• “On the other hand, it has created a lot of social problems. When too many people gather, it causes mass confusion. Also this isn’t limited to Pokémon Go, but the issue of staring at smartphones while walking is something we have to focus on and think about.

Read also: Pokémon Go celebrates 1st anniversary with real-world event

The new Pokémon game for Switch

In June, Ishihara revealed that a role-playing Pokémon game was under development for the Switch. A 16-second clip of the announcement caused Nintendo’s stock price to jump as much as 3 percent in U.S. trading, as investors bet the new title will boost Switch sales. Ishihara shared a few more details about the game, which is set to be released in 2018 or later. 

• “With the Switch, we see it as a chance to create Pokémon that goes deeper and with a higher level of expression. As a result, that makes it an extremely important platform.”
• “Right now we’re using 7 to 8 inch screens, but on a high-definition TV you can express a whole different world with graphics and sound.”
• “Until now, games were made as one for one person, but now you can go home and play with everyone -- so how do we tackle these themes, and how do we make sure it’s not complicated?”
• “I can’t say that we’ll release accessories, but I’d like to think of that possibility.”
• “Unlike smartphones, the Switch is not a game device that assumes that there’s constant network connectivity. So from our perspective, it’s really not that different from DS or 3DS in terms of connectivity.”

Read also: Pokémon Go makes $1 billion revenue worldwide

Augmented reality and the future of Pokémon

Ishihara also spoke at length about augmented reality, a technology that superimposes virtual characters and scenes onto real-world images. He said that this fits well with the Pokémon company’s vision of blending fantasy with reality, as Pokémon Go did as a location-based game.

• “With current AR, even if you say Pikachu is there, no one really thinks that. But that reality is just one step away. For example, you’ll be able to find Pikachu, and it can sense this table and jump on it, and you can see its shadow on the table, and then it faces you and starts talking to you. We will see the birth of this reality that is another step up from the current Pokémon Go. And I’ve only mentioned the visual aspect, but you can add haptic and rumble technology to that.”
• “Voice-activated assistants are increasing. Whether it is Google Home or Amazon or Apple Homepod, there are many of them and we could see these dialogue-based devices give birth of a new form of entertainment.”
• “Switch is just one of the possible platforms. I think we will open up more possibilities from all these platforms. Playing in a more realistic way should be possible.”

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