Last Thursday afternoon, I sat in the office of Niantic Labs with its CEO John Hanke across from me at a conference room table. He looked like he hadn’t had a good night’s sleep in a few weeks, but made some time to begin a set of interviews that would span the next three days. That evening he also participated in a photoshoot for a FORBES magazine story that was published this Tuesday. But sometime between that interview and having his picture taken, he launched Pokémon GO in Japan, the birth nation of the popular pocket monsters franchise, and set his company’s servers ablaze once again.
It’s all part of the job if you’ve created the most popular mobile game of all time. Pokémon GO has turned Hanke’s life upside down. Save for the ten days he spent in Japan following the app’s launch, he’s been surrounded by people playing the game. It’s become so crazy that Niantic had to scrub its name off its San Francisco office building to discourage people looking for rare Pokémon from knocking on their door.
The man who helped build Google Earth says he’s never seen a reaction like this for product he’s created. He may never again.
Below are excerpts from conversations between FORBES and Niantic Labs CEO John Hanke that spanned for three days across San Francisco and San Diego. The conversation has been edited for clarity and structure.
Forbes: Did you grow up playing computer games? What was your first game?
John Hanke: I grew up in the 8-bit sort of home computer generation. The first game I got paid for was on an Atari home computer–Climber in 1983–and I it sold to a magazine.
A TRS-80 was the math computer in our school when I was in probably the seventh grade. I was hanging around watching older guys and they were playing the original Star Trek game with ASCII graphics. It was like nuke the Klingons from solar system to solar system. I ended up spending hours and hours in the computer room doing that. A couple years later, I saved up my money mowing lawns and bought an Atari 400 with $500 and a tape recorder to save all my programs.
When I was growing up I was reading Byte magazine and reading about Steve Jobs and [Steve] Wozniak and all the characters in California that were inventing personal computers. It all seemed like a remote, foreign place that I wasn’t connected to–an impossible thing to be part of it, but it was something that I wanted.
F: How did you end up at Keyhole? I heard it started from a gaming company?
JH: A company formed called Intrinsic Graphics and the founders all came out of Silicon Graphics (SGI)… and they wanted to build a game-building platform. That’s the direction that they started in. While they were spinning things up, they created a demo of something that would have been an SGI sort of hallmark: a spinning globe with satellite imagery textured onto it. This is something that SGI would take to trade shows and show this Infinite Reality System which was a multimillion-dollar visualization system. It could do this-jaw dropping thing called “space to face” where you would see the globe and you would zoom into a high-resolution satellite image.
They tried to recreate that on a personal computer as a demonstration as sort of their prowess. That’s basically what it was. A demo. There was a low-resolution inset and one high-resolution inset, I think it was of Denver, Colorado… You see the globe and hit the button and vroom… it looked cool, you could show it to investors and raise money but it didn’t have anything to do with the company. So they decided to spin it out. [Hanke was later recruited to be CEO of that company.]
F: How did Google GOOGL +3.43% end up hearing about Keyhole?
JH: They were deliberating buying this company called Picasa, which they ultimately bought and was one of the early photo-sharing sites. And during the discussion to buy Picasa, Sergey [Brin] was flying around in Keyhole and had a projection on the screen and was bugging everybody saying, “Look at this! Where do you live? Check this out!” He was being typically Sergey and very disruptive.
We went to Eric [Schmidt]. And we went in and talked to Larry [Page] and Sergey. We didn’t understand Google. Nobody understood much about Google. This was pre-IPO… There were rumors that they had masseuses and these lavish catered meals and stuff. And we were like, “What’s going on over there?” As it turns out that was true.
F: So you get to Google and you stay for a few years leading Google’s Geo team. I heard you brokered the deal that got Google Maps onto the original iPhone.
JH: Well I’m at home sitting in my living room and I get an email from Steve [Jobs] at Apple: “Can I give you a call.” I thought someone was pranking me and I told my wife, but just in case I emailed back and said, “Sure, give me shout tomorrow morning.” The next day Steve Jobs called. And I picked up. He was still being very coy about the iPhone: “You may have heard about this project that we’re working on.” That began the process where we put some people with their people. It launched in January as I recall, and we started in September or October. A real crash effort.
F: Then you start Niantic. What was the thought with creating that?
JH: Gaming was a thought, but it wasn’t necessarily the focus. It was in that mix with social and discovery and mobile and maps. We didn’t know what we wanted to build but we wanted to explore that general space. The first actual project where code got written was Field Trip. Then we collected some data for Field Trip around historical markers. [Field Trip was an augmented reality app for mobile phones that populated information of interesting landmarks when a user walked around a city.]
I then made a prototype of a game and coded it up. It was the first time I’d done any coding in a while. It was called Battle For San Francisco and it was pretty crude, but it was really fun for me to write code.
I added areas around Mountain View and San Francisco. Some were working down there and some were working in SF and people were making raids on each other’s territories. One guy rode in early in the morning so he could capture territory from us… That was 2011 and we saw the basic fun of that. After other brainstorms and a false start or two… we settled in with Ingress.
F: Is Pokémon GO possible without Ingress?
JH: No. Who knows. It’s a counterfactual hypothetical. But it took a lot of iteration around Ingress and the building up of infrastructure and data and seeing what things worked and things that don’t. All that was rolled into Pokémon GO. If you had come out with Pokémon GO absent of that experience, I don’t know if we would have done anything that people would have liked or not. The whole infrastructure that the game runs on is the second-level technology stack that was built from Ingress.
The decision to go with a nichey, Sci-Fi game was very deliberate. We felt like it was the first time out of the gate with a nichey new genre of game. Instead of doing something really broad and trying to put a smiley face on it–a sort of pop app for the masses–we sort of went for the app for mid-core gamers because we felt they would be more tolerant of an imperfect product and they would be early adopters of a new technology.
F: How did you get connected with The Pokémon Company?
The April Fools’ thing happened. [Meetings were later set up in Tokyo].
In that preliminary phase Mr. [Tsunekazu] Ishihara [the CEO of The Pokémon Company] had become aware of Ingress. By the time I met him, he was a higher level than I was. They just got it, we didn’t really have to pitch it. We went through the motions of explaining the vision. They came to see us in Mountain View for a time after that.
I was a level 10 player, he was level 11. There are 16 levels, and to be 14, 15, 16 you have to be crazy hardcore.
There was a pretty good chance we would have been interested in and pursued a Pokémon project whether there was an April Fools’ joke or not.
F: So what level are you in Pokémon GO?
JH: I’ve had so little time to play since the game launched. I’m, like, level 5. I was in Japan for 10 days [after the launch] and I couldn’t play over there at all because it was blocked. [Hanke had a much higher level in the beta testing of the game, but that progress was wiped when the app was officially launched in early July.]
My kids are pretty high. My younger one was 12 or 14. All three of them are playing and their mom. My wife is loving it because all the other moms are loving it because their kids want to go out and go to the park.
F: I know you were behind the launch of Google Earth but have you seen anything like this?
JH: You don’t see the physical manifestation of it. I think the first time I saw that was the day we launched Ingress and I went to get lunch and I heard the sound effects from a guy that was standing in line. That was amazing–to encounter the product of your labors out in the wild, you know? I asked him some questions: “Hey, what are you doing?” And then I told him I worked on it.
Pokémon GO is just this other level of penetration that I still don’t want to jinx it.
Since that flurry of negative press that came out there’s been a wave of positive stories in the past few days.
F: And the negative press has been?
JH: Someone found a dead body. Someone got mugged. Someone drove their car into a police car.
F: I think the finding the body stuff is that you’re more out and about.
JH: Hah! True. It’s not really about the game it’s more a ding on society that we live in a world where dead bodies are floating around to be found.
We want to make the game as safe as possible. It’s not dissimilar to Strava or a running app.
F: How do you feel about the people that are trying to cheat the game? I saw a guy put up a train set around his home for his phone.
JH: Hah! To hatch his eggs? Well that’s kind of cheating, but it’s kind of creative and funny to so I don’t really mind it. He’s only cheating himself.
I saw a turntable hack. I saw that one for hatching eggs.
F: What about the guy in New York that said he caught all the available in his area?
JH: Yeah, I saw that. We were speculating on it–is this guy cheating? I’m not sure what the final conclusion was.
F: So he hasn’t truly caught them all? What about the legendary birds?
JH: Time will tell.
F: How do you feel about Poké Radar and things that tap into the code and show where Pokémon are spawning?
JH: Yeah, I don’t really like that. Not a fan.
We have priorities right now but they might find in the future that those things may not work. People are only hurting themselves because it takes some fun out of the game. People are hacking around trying to take data out of our system and that’s against our terms of service.
F: But in every game you have that. You have people with cheat codes.
JH: True but it’s a multiplayer context… It’s a constant battle. World Of Warcraft had that too.
F: I think you’re intent is to open up one-on-one [battles] and right now you can go to these gyms. But it’s not really multiplayer in the sense that I’m seeing other people in the game, at least yet, right?
JH: That’s true. But the team gym aspect of it is something we think is important to the game long-term. For that to work, that has to be free of a large amount of cheating and spoofing.
F: You’ve been a little hesitant to talk about what comes next in the game. If you look at the original Gameboy games in Japan–red and green–Mew was the ace in the hole. They didn’t tell anyone that it was in the game until later. It was an O.K. game [in terms of sales] but after they said Mew was in the game it flew off the shelves.
JH: Oh really? I didn’t know that.
F: So everybody is wondering: What do you add to the game later that brings people back if you start to see numbers drop?
JH: Well there are a number of threads that you will start to see. You will see new Pokémon come into the game around special events at certain times in certain parts of the world. You’ll see us do some things around events. We initially thought that we would organize events ourselves like we did for Ingress. We’ll see if we do or not. There are a lot of self-organizing events that are happening and maybe we just support those. There are some things that we do in game with the gameplay to make the events more interesting.
Some of this, it’s not like we’re withholding our secret plan from you. We intend to iterate and work on these specs right up until the moment it ships. Stuff evolves until the last minute. Like with Ingress if you attend one of our events, you get an in-game medal that shows up in your profile… It’s an achievement like the achievement you get for walking 1,000 kilometers.
We have achievements in Pokémon. So we could have medals around events in Pokémon. I’m not sure yet.
F: There was a fan theory the other day. Given that there is portals [for Ingress] in Antarctica, maybe you can go there to find an Articuno, the legendary bird.
JH: Could be cool!
F: You’re going to start seeing double the flights to Antarctica.
JH: [Laughs]. Like in Korea. I hadn’t watched the video until yesterday and the mayor was promoting it and that visitors should play Pokémon. He’s a very entrepreneurial mayor. [A town in South Korea was part of a mapping glitch that allowed some residents to get the game early.]
I think that is so strange though to see this purely virtual artifact have that impact in the physical world. I think that’s pretty unprecedented to have this virtual wall where everyone stands on one side of the line instead of that side because there is clearly a virtual distinction between the two.
Forbes: What about past mobile gaming companies that have had one, two, three hits like Zynga or Rovio. It almost seems like mobile gaming companies reach a certain point and then they fade. How do you avoid that?
JH: It’s an interesting strategic question. There are ways to mitigate that. Part of is, it’s like any business, you have to have some strategic moat… For what we’re doing, there isn’t really and it’s competition right now and it’s hard to do.
We’re not building just another Candy Crush. There’s a huge amount of infrastructure behind our game… For those that want to compete with us, they’re going to have to invest in comparable amounts of engineering resources with comparable amount of quality on the engineering team over a comparable amount of time to get there and we’re going to be running at full speed to deepen our technology stack and out data such that we maintain that gap between everyone else.
What we’re doing on server side to operate a massively multiplayer mobile game at this scale is pretty special.
F: How many people did you expect to sign up for the game?
JH: We expected tens of millions of users to sign up and create accounts…. Based on our projections, we got, in the first two weeks, somewhere we expected we’d get sometime by the middle of next year.
F: Did you do any market research to figure out how big this thing would get?
JH: We didn’t do much research. We had one data point which was Ingress. We had another data point from The Pokémon Company about how many people were in the Pokémon fan club and how many units there game has sold and we looked at those two things and we said we got this set of potential “lapsed users”–Pokémon people that are maybe not actively playing the DS games today but did at one point in time. It was that set of people and a good portion of them we thought would be potential users for this game.
I think we got that set of people, but I also think we got a whole bunch of other people that maybe knew about it through friends, or grew up with it or Pokémon was a cultural touchstone, but wasn’t something that they were deeply into.
F: Server issues. How have you dealt with those?
JH: The system was built to scale and built to add additional users, but you don’t really know how that’s going to work until you stress the system at those levels of usage. As we started adding more users, we found that certain things broke and had to be repaired quickly. Typically the way it works in a situation like that, you fix something here and that relieves some pressure but then that forces more pressure somewhere else in the system and you have to fix that… We had this cascading set of things where we added more machines and things broke at this level then we fixed them, and things broke at this level then we fixed them, and things broke at this level then we fixed them.
We’re now at a level that we’re at pretty good shape from where things go from here. We were servicing a very large amount of concurrent users.
F: Everyone is talking about the McDonald's MCD -1.48% deal that you did. Going into location-based stuff, did you know that there was obvious business opportunities here?
JH: We incorporated that sponsored location model into Ingress the day it was launched. The idea was to build an alternative to in-app purchase based on idea that in-app purchase exerts a lot of pressure on game design that can lead to games that are not very much fun to play even if they make a lot of money. We kind of caved a little bit when we spun out and added in-app purchases to Ingress and we of course launched Pokémon GO with in-app purchase. My belief is that the sponsored-location model is a better business model for games.
The idea with real world games was to build an advertising model that is deeply tied to the way the game itself works… so it doesn’t break the flow of the game. It doesn’t feel like something is grafted on. That’s what we’re trying to do and it will provide a compliment to in-app purchase. In app-purchase will be the majority of the revenue, but it does take some of the pressure off of us to squeeze hard on the purchase side which would be detrimental to the game.
F: I assume people are going crazy to get those Pokéstops at their local restaurants.
JH: There are so many. We’ve been bombarded be people saying, “Please, please, please.”
F: Pretty much every business I can think of? Movie theaters and Starbucks?
JH: Yeah, yeah, yeah. If we’re building that type of business, to have all the potential customers asking to be part of the program is great.
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by Ryan Mac
@forbes