Oh, so it's similar to that thing that google did where you could find pokemon in really life locations using google maps?Assuming I'm reading the trailer correctly, it's a mobile-based ARG in the same vein as Niantic Labs' Ingress.
Effectively, real-world locations on a map - as determined by GPS coordinates - are assigned events in the game. More succinctly, things happen based on where you actually, physically are.
The net effect is that wild pokemon spawn in actual locations, and if you want them, you, physically, will have to travel to these locations, hunt them down, and catch them. Or I guess trade if you're lazy or homebound.
Certain major events will also apparently happen at fixed locations. In the trailer we saw a mass battle with Mewtwo in Times Square; I suspect that we'll see other legendary distributions - maybe the Legendary Beasts could inspire some cross-country shenanigans.
If it's anything like Ingress, people will probably do some bonkers stuff in real life to search for virtual 'mons. I never got deep into Ingress, but - assuming my phone cooperates - I'm gonna be all in GO like a wedgie.
Now what the trailer shows that is unlikely to actually occur, far as I know, is the actual overlay of the Pokemon into our world, AR style. Mobile devices can technically do it to some degree, but the tech necessary to determine exactly what a valid surface would be is beyond many phones' capabilities as far as I know, at least without setup involved. Of course, if they make a version compatible with, say, Google Glass, then all that goes out the window.
[EDIT]: And then I do some research, because logical progression.
In addition to the above, Nintendo is developing a watch-like Pokemon Go Plus that syncs to your phone via Bluetooth and keeps track of local events. If something goes down nearby, say a wild Pokemon appears - it notifies you and can even perform simple actions, such as catching them. The idea is probably so you don't have to have your phone out 24/7 to play.
If you explanations right, ti would explain a number of jokes I have seen about it.
Hm, I might actually do this. Would be kind of fun just walking down the street and a wild pokemon appears and I'm seen standing in the middle of the street playing with my watch.