• by Laurie Sullivan  @lauriesullivan, October 15, 2015

Google, Nintendo, Pokemon Co., and other investors infused $20 million in a Series A funding round for the Pokemon Go developer Niantic, which spun out from Google in August.

Investors plan to contribute $10 million more after the company achieves certain milestones, wrote Niantic CEO John Hanke in a blog post, but he did not specify the details. The funds are being used to bring new games to market, to further develop Pokemon Go, and support advancements in the mobile augmented reality (AR) game "Ingress" and other real-world gaming platforms.

Google Cardboard, Facebook Oculus, and Microsoft HoloLens promise to bring the world of virtual and augmented reality to advertising and marketing with support from smartphones. Facebook Founder Mark Zuckerberg believes virtual reality will become the next platform. "After video, the next logical step is fully immersive virtual reality," he says. "Where you'll be able to create full scenes and feel like you're right there in it."

The media and entertainment sector should post the highest average earnings before interest, taxes, depreciation and amortization (EBITDA) of any company, about 28%, according to the EY report Spotlight on Profitable Growth released Thursday. The report says electronic gaming companies are seeing an increase in mobile gamers and use of multiple monetization models.

A combination of an expanding base of mobile gamers, multiple monetization models such as subscriptions, micro-transactions, accessory sales and downloadable content, continued engagement of console gamers and focus on core franchises will drive EBITDA dollar growth for the electronic gaming sector, according to the EY report.

In September, Nintendo and its subsidiary The Pokemon Company, along with Niantic made plans to release an augmented-reality Pokemon game for smartphones in 2016. In-app purchases will make the game free to play.