Niantic is keeping details on the upcoming Pokemon Go updates relatively quiet but the Generation 2 rumors are very persistent and all suggest the same time period: March 2017. This release time has not been confirmed by Niantic but this is certainly a realistic date.
Generation 2 will only be released to the world once the final Pokemon have been released for Generation 1 and according to Niantic, the legendary Pokemon will be released very soon. Current estimates suggest that the Generation 1 legendary Pokemon will be released this year and the developer has previously stated that they will be released in the next major update.
New rumors have emerged for Pokemon Go which suggest the Pokemon Breeding will be coming with the next generation; this idea is based on Ditto which has still not been confirmed to be in the game. There are reports claiming that Ditto is a region exclusive to Africa but Niantic hasn’t commented on this yet so it’s still uncertain. This Pokemon is key for breeding in the main games so it would seem likely that Ditto has the same purpose in Pokemon Go.
Players should expect to see more region exclusive Pokemon coming with Generation 2; there are already predictions about which Pokemon will be region locked in the next generation. Rumors suggest that Miltank will be restricted to North America and Heracross will be Asia exclusive.
This Generation 2 update is expected to be launched in 2017 however some new reports suggest that it could be arriving at the end of the year; the game has been slowly losing its player base and bringing the next generation to the game is guaranteed to bring some players back.