So what's the deal with Pokémon Go right now? That's a difficult conversation to have, partially because there are a lot of over-reactions. The tracking system wasn't working, and in fact had not been working for weeks. People recognized that it was not working, and they did not rage about it. Niantic did two things to fix this: they removed the visual representation of failure (the footprints that would have been the tracking system had it worked) and blocked the excessive drain on their servers caused by third-party tracking systems. Naturally, people reacted calmly...except they did not at all, at least not the vocal minority. This decision has been declared by some "the death of Pokémon Go" and other things that don't make much sense.
Much more damaging is the fact that while wild Pokémon encounters seem to have increased ("seem to" being the operative word; I haven't started a new low-level account to see if this was universal or not) it's become much more difficult to capture them. Even the green-tier 'mons (the easiest to capture) are now sometimes breaking out of Pokéballs. In my experience, this has had a pronounced change on the game: I haven't seen a lure model in use in my city since that changed. At least once a week I will go on a two hour walk specifically to get more Pokéballs in areas that are otherwise out of my way. Despite that, I'm scared to use an incense out of concern that I will run out of Pokéballs while it's active. (By comparison, the only time I've ever run out of Pokéballs before this was a time when six lures were used in rapid succession and I was back up/span>to 80 by the end of that night).
When accused of increasing the difficulty in order to encourage players to engage in more microtransactions - specifically purchasing more Pokéballs instead of only using the ones at PokéStops - Niantic claimed this was a mistake. There is of course no way to verify this, and this has become partially fixed over the past week. Still, one would think this a relatively simple bug to fix.
Ultimately, it's not a surprise that a game that swept the nation a month ago is undergoing a bit of a lull right now. While it's become less frustrating to play - it freezes much less - it's also become slightly less fun. The "newness" is also gone. When you're wasting Pokéballs on a regular basis, it's a lot less enjoyable to lay down lures and go hunting. The gyms have developed into a sort of rotation, and this is not helped by the fact that at higher levels there seemto be more opportunities to injure your Pokémon and use items than there are to actually pick up new items. The discussion of adding PokéCenters could fix this, but as they haven't come out yet (I don't think there's been a single update that wasn't fixing a bug, reinforcing the statements of beta testers that the game wasn't ready yet) that's not a fix we can rely on.
I think the game is settling from its position of worldwide phenomenon to MMO. Unfortunately, if this happens it will be among the least successful games in the Pokémon franchise. Still, there are a lot of updates coming. Over the next few years there will be six (probably seven by the time it comes) additional generations of Pokémon to add. How this will function with how difficult it already is to evolve some Pokémon will be a problem for Niantic to decide. As it is, I still think Pokémon Go is a fun game and one that still encourages community togetherness and exercise...but Niantic will need to put in serious work to keep it doing these things rather than becoming a forgotten curiosity.