Metaverse: inventory of a new world in its infancy

On October 18, 2021, Meta (the parent company of Facebook, WhatsApp and Instagram) announced the creation of 10,000 jobs in the European Union over the next five years to invest in new talent and help build the metaverse. A year later, Mark Zuckerberg announced 11,000 job cuts, setting off the first wave of layoffs and acknowledging the most difficult turnaround in the company’s history.

However, a recent McKinsey report estimated the metaverse market to be worth $5,000 billion by 2030, making it the third largest economy in the world after the US and China. Investments are estimated at more than 120 billion dollars. As big as the Metaverse project is, it exceeds the ambitions of a single company.

Famous retailers and brands such as Nike, Balenciaga or Louis Vuitton are located in these virtual spaces. Companies such as Microsoft, Amazon or Google have confirmed their investments. The situation is uncertain, so let’s decipher the differences in perception of the metaverse and examine the ingredients that may contribute to its success.

Why is Metaverse not meeting the expected success?

The first source of uncertainty is due to the simple fact that we don’t all agree on the definition of metaverse(s). The metaverse is a concept under construction, and no one knows what it will look like, or even what lies behind the term. Web3 are all modern creations revolving around non-fungible tokens (NFTs) and the blockchain metaverse. The lack of knowledge about these technologies and the blurred boundaries between these concepts and the concept of the metaverse do not contribute to general public understanding.

In May 2022, Ipsos published the results of a survey showing that only 28% of French people were familiar with the concept of the metaverse. Although major groups, states and the EU are investing, 62% of the French still do not see the point of virtual worlds. Therefore, it is important to inform citizens to better understand the metaverse and related technologies.

Virtual reality headsets are still under-received

The mission’s interagency report on the development of the metaverse, published in October 2022, defines the latter as “an online service that provides access to simulations of real-time, shared, and persistent 3D spaces where we can experience immersive experiences together.”

This definition puts the virtual experience at the heart of the matter. However, virtual reality headsets are still underutilized and have obvious limitations (price, autonomy, weight). In their desire to enter, major players present a metaverse that can be accessed through a virtual reality headset, but also through a browser or mobile app. While immersion is necessary for some players, for others it would be a brake on the democratization of the metaverse.

To date, several hundred metaverses can be identified, and the largest (Roblox, Second Life, Zepeto, Minecraft, Fortnite) have millions of users. The huge numbers we see in circulation are inflated by the success of massively multiplayer online games. However, the latter could arguably be considered a metaverse. This question should be discussed, especially since some articles have highlighted the very low participation of platforms regularly referred to as the metaverse (Decentraland, The Sandbox). Although these numbers are contradictory, we are not reaching the level of commitment we had hoped for.

What does Metaverse success require?

Metaverse reception is very slow for observers. Anticipation is high as major players emerge early and bet long term. Despite reaching a record 400 million monthly active users in 2022 (equal to the number of Internet users at the turn of the year 2000), mass adoption is far from over. At the recent DealBook Summit, Mark Zuckerberg hinted that the metaverse won’t be profitable until 2030 at the earliest.

Gartner’s research shows that in 2026, 25% of people will spend an hour a day in the metaverse. His methodology cycle syringe (a curve depicting the evolution of a new technology) positioned the metaverse as an emerging technology. He estimates that his productivity plateau will be reached in more than ten years.

Businesses looking for better productivity can be a key driver of adoption. Many believe the metaverse is poised to revolutionize remote work. The health crisis has greatly contributed to the acceleration of the adoption of this type of format. According to a Forrester report, at least three of the following four leading solutions, Zoom, Slack, Webex, and Google Apps, will add metaverse-like functionality in 2023. A recent PwC survey found that 51% of companies are in the process of integrating virtual reality into their strategy or have already integrated virtual reality into at least one area of ​​their business. Institutions of higher education have also identified the beneficial effects of the metaverse.

Ease of use, usefulness… the metaverse still needs to be improved

Examples of technology adoption remind us of the importance of usability criteria as well as utility. To date, these are not really implemented. When our motivations are sufficient, efforts to enter the metaverse will no longer be an obstacle. For what has happened, Capgemini indicates that three-quarters still use it and will continue to use it.

Among the many conditions that allow the metaverse to be deployed at scale, the following criteria are regularly put forward.

The Metaverse must be interoperable. This means that designers and platforms that enable the creation of virtual universes must rely on common protocols to make it easy to change the virtual space. Ultimately, navigating from one location to another should be as simple as navigating from one web page to another. This work continues with the efforts of the Open Metaverse Alliance (a Swiss-based association) or the Metaverse Standards Forum (an industry consortium).

Being able to take advantage of (near) real-time interaction is essential for a satisfying experience. The number of operations per second is the main limit. The rendering and timing of scenes are subject to technical execution. To reach a large audience, the metaverse will therefore have to rely on increasingly efficient technologies. This brings up the issue of energy consumption of virtual universes. The latter will have to register as well as possible within the framework of digital vigilance.

On the need to reduce cybernetosis

Technological developments will also need to find solutions to reduce cybernetosis (a term adapted to motion sickness – a mismatch between visual perception and the vestibular system that causes motion sickness) suffered by about 40% of users, as well as visual fatigue, muscle and mental strain. Similarly, theft of data, digital assets, or breach of privacy due to security or ethical concerns can lead to a loss of trust among users and investors.

Tools should be more accessible without creating unnecessary complexity. Creating a cryptocurrency wallet, buying NFTs and creating a virtual experience should be more intuitive.

An expected advance is a finer capture of our senses, including touch, smells and localized sound. Haptic jackets are starting to emerge and help you experience virtual interactions in the physical world. They allow you to feel, for example, the feeling of wind or even rain. Versatile mats allow you to run, swim and move in virtual universes with realistic gestures.

Today, the video game is a gateway to the metaverse, where the youngest has already won, but struggles to convince other audiences. The Metaverse is in the hands of the young, as about 51% of users in some virtual universes are under the age of 13. If the metaverse regularly faces waves of skepticism, the new generation seems already immersed in the virtual universe and actively participates in its construction.

About the authors:
Charles Perez. Associate Professor at PSB Paris Business School.
Armand Derhy. Director of the Paris School of Technology and Business, PSB Paris Business School.
This article is republished from The Conversation under a Creative Commons license. Read the original article.