Tech giants are all a flutter about the ‘metaverse’ and how they plan to help build it.
A successor to the internet and convergence of technologies, the metaverse will combine physical and virtual worlds.
If the metaverse grows as predicted, the opportunities for business could be vast and lucrative.
First coined in Neal Stephenson’s science fiction novel Snow Crash, the ‘metaverse’ is… well, hard to define.
You might see it referred to as the mirror world, AR cloud, the spatial internet, social internet, embodied internet or even the magicverse. And while it isn’t here yet, during the COVID-19 pandemic you could have been unknowingly exploring its beginnings.
As lockdown and quarantine kept many away from friends and family, people gathered in co-opted online spaces. Weddings, funerals and political campaigns took place in Animal Crossing, graduations in Minecraft, slumber parties via Netflix and family reunions on Zoom.1 Slowly, these spaces became ones not simply for ‘gaming’ or ‘streaming’ but for the expansion of physical lives.
Were people engaging with prototypes of the metaverse? Quite possibly, and yet, for most, they’d likely never heard the term before, nor had any idea what it was.
There is much debate among the tech community over what the metaverse is and isn’t. The basic idea is that the metaverse will be a convergence of physical, augmented, and virtual reality in a shared online space.2 As the potential successor to the internet, it is imagined that the metaverse will be a place where people meet to socialise, attend remote work meetings, participate in events such as concerts, conferences or games, and an individual digital avatar that represents them.3
However, it’s posited that it won’t solely be a digital place where people only ‘go’. The metaverse will be around us in the physical world with the use of IoT, AR, VR and emergent technology. There could, for example, be a digital replication of everything in the physical world, so that when you chuck on a pair of AR glasses, the shops (workplaces, parks, anything really) you pass down your physical street could have a digital presence also, allowing you to interact or even purchase physical items to be delivered to your home without physically stepping inside.4
The key features that constitute a metaverse are: it’s physical and digital, it is always on, it is in real synchronous time, it has a fully functioning economy, everyone can participate, it is a place of content and experiences, and everything in it will be interoperable.5 Now, it’s fair to say that as of 2021, a lot of those terms are undefined in terms of possibility, but most enthusiasts seem to agree that in some form or another, those are the base requirements for the metaverse.6
Given where we stand with so many unknowns, it is difficult to imagine how the metaverse might change our lives, much as it was on the eve of the dot.com boom to foresee the impact of the internet. Instead, argues metaverse-guru, Matthew Ball, it is perhaps easier to define what it is not.
Unlike virtual communities, the metaverse will not be a standalone place or online community, such as the ‘world’ of an online game. Rather, it is imagined as an overarching ‘universe’ wherein all the facets of society, including game worlds, can be found. It won’t be just a virtual world, such as SecondLife.* It won’t be pure VR, though you can interact with the metaverse through a VR headset or AR glasses. It won’t be just a digital economy, such as a blockchain, but a digital economy will exist within it. It won’t be designed (like a game), nor will it be an app store (again, apps will exist within it), or an entirely new platform.7
It, as currently imagined, is more than the sum of all these parts — an augmented, interactive layer to our physical and online lives, where apps, platforms, games, experiences, communities and spaces all exist in a way that is seamless, weaving between the physical and digital. It is pure Fourth Industrial Revolution.
The metaverse is better thought of as a convergence of technologies that have been bubbling away for years (and even decades) coming into brilliant usefulness, together. Online gaming, blockchain, apps, AR, VR, internet, smart devices, social media, tv streaming, music streaming, podcasts, video, cloud, online shopping, hybrid workplaces, the creator economy, influencers, combining to form an extra dimension to our current lives. As Ball puts it, the metaverse is an idea that has been around in tech circles for a very long time, but just recently, “the pieces have started to feel real.”8
While there’s reason to believe that the metaverse will become ‘real’ in some shape or form, whether that happens in the next five years or in twenty, is anyone’s guess (and there are plenty of predictions). So do businesses need to pay attention?
In some ways, yes, if only to keep your mind on future possibilities. Big tech certainly is, which is the first clue that this might not be just a flight of fancy. Ball goes as far as saying in his blog that the metaverse is the “new macro goal for many of the world’s tech giants.”9
No one company can own the metaverse, but, in the same way that no one company can own ‘the internet,’ there will be big money for companies that can monopolise certain corners, say underpinning platforms or services like subscriptions, payments or advertising. Some of today’s tech companies are already in prime position should they wish to do so — acquisitions into AR, VR, social apps and games that didn’t quite make sense a few years ago take on a whole new meaning in this context.
Facebook, which owns Oculus VR, recently launched new smart glasses with RayBan10, and announced that it plans on becoming a metaverse company — launching a VR workspace for remote workers as a first step.11 [Editor's note: And the thinking behind their subsequent holding company name change to "Meta" - 29/10/21]12 They aren’t alone. Microsoft is working on building an enterprise metaverse. Epic, owner of Fortnite, alongside NVIDIA, Snapchat and Tencent are all interested, if not making outright moves in the meta direction. By some accounts, there are potentially trillions of dollars of value up for grabs should the metaverse take off.13
It has already been claimed that the metaverse will lead to a shift in communications as large as those brought about by the telephone or the internet.14 Much like the shift in content, branding and advertising that came about with social media, so could a shift occur with the metaverse. How brands engage with customers will need to be rethought.
In the purely digital layer of the metaverse there could also be opportunities. People may want their virtual avatars to wear branded digital clothing or to decorate their virtual real estate where they entertain physical friends via VR. All these items will need to be created and sold. New products and new services will be on the cards — from payments to ID verification, content creation (live events, experiences, games), cryptocurrencies, blockchains, virtual labour, and let’s not forget, cyber security. The list goes on.
The metaverse is, at the moment, a philosophical concept. Being hard to imagine, it’s hard to plan for, and while its beginnings can be seen today, there’s no guarantee that they will evolve tomorrow as imagined.
Like most technology, it could be both under- and over-hyped. Certainly, for it to appear in the way futurists predict, a lot of standardisation and cooperation will be needed. Amongst this utopian vision are thornier questions that need to be asked about who is doing the building and what their biases and motivations are. Who is being included and left out of the future universe? As we know with access to the internet and technology today, these are not insignificant issues.
What is certain, is that the concept is intriguing, commercialisation is on people’s minds, and the giants are rumbling. They’ve been right before, so it is perhaps wise to keep a virtual eye on what they’re seeing.
*Still going, by the way.
With thanks to PwC US director Louis Bennett and PwC Australia partner Matt Benwell.
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