Niantic, the renowned developer of the hit augmented-reality mobile game Pokémon Go, is reportedly in talks to sell its video game division to Saudi-owned Scopely for a staggering $3.5 billion. This potential deal, first reported by Bloomberg, would likely include Pokémon Go, the game that sent players out into the real world to collect Pokémon and broke numerous records in the process. The sale is expected to be confirmed in a matter of weeks, although neither Niantic, Scopely, nor its owner Savvy Games Group has commented publicly on the reported acquisition.

The potential sale of Niantic's video game division to Scopely, a leading mobile game publisher, marks a significant shift in the gaming industry. Scopely, which publishes popular titles such as The Walking Dead: Road to Survival, Stumble Guys, Marvel Strike Force, and Monopoly Go, is owned by Savvy Games Group, a Saudi Arabia-based company that has been actively investing in the gaming and esports sector. In 2022, Savvy Gaming Group purchased two of the world's biggest esports companies, ESL and FACEIT, for a total of $1.5 billion, and in 2023, it acquired Scopely for $4.9 billion. The company's ambitious strategy aims to make Saudi Arabia the ultimate global hub for the games and esports sector by 2030, with a focus on diversification, innovation, and scaling the entertainment and esports competition offerings across the Kingdom.

Niantic's journey began in 2010 when John Hanke, the company's CEO, led a team inside Google that envisioned the future of augmented reality gaming. The team launched Ingress, the first major global augmented reality game, in 2013, and within two years, it had amassed seven million players. In 2015, Hanke spun out the Google group into an independent company called Niantic, which later launched Pokémon Go in collaboration with Google, Nintendo, and The Pokémon Company. By the end of 2016, Pokémon Go had been downloaded by more than 500 million players, making it one of the most successful video games in history.

However, in recent years, Niantic has faced significant challenges, including the cancellation of titles and layoffs. In 2020, the COVID-19 pandemic hit, and millions of players sheltered in place, leading to a decline in the company's revenue. In 2023, Niantic laid off 230 employees, roughly 25% of its workforce, and Hanke emphasized the company's need to focus on Pokémon Go. The potential sale of Niantic's video game division to Scopely may mark a new chapter for the company, as it shifts its focus towards mapping and geospatial models, using the data collected by its apps to create large-scale machine learning models that understand and connect scenes globally.

The potential acquisition of Niantic's video game division by Scopely has significant implications for the gaming industry, as it highlights the growing interest of Saudi Arabia-based companies in the sector. The deal is expected to be closely watched by industry analysts and gamers alike, as it may signal a new era of investment and innovation in the gaming and esports sector. Some of the key points to consider in this deal include: * The sale price of $3.5 billion, which is one of the largest deals in the gaming industry in recent years * The potential impact on Niantic's employees and the company's future direction * The growing role of Saudi Arabia-based companies in the gaming and esports sector * The potential for Scopely to expand its portfolio of games and increase its presence in the global gaming market * The implications for the future of augmented reality gaming and the potential for new innovations in the sector