Facebook Chief Executive Mark Zuckerberg has been in the news for a number of reasons recently, including his desire to see his company prosper in an environment often referred to as the “metaverse.” Zuckerberg’s desire is so strong in fact that Facebook won’t hesitate to invest billions of dollars and spend multiple years on this new reality. While Facebook hasn’t been shy about taking big financial swings in the past, one might wonder what exactly is the social media giant investing in this time around? What is it looking to buy? In other words, …
What is the metaverse?
Facebook defined the metaverse as, “A set of virtual spaces where you can create and explore with other people who aren’t in the same physical space as you. You’ll be able to hang out with friends, work, play, learn, shop, create and more. It’s not necessarily about spending more time online — it’s about making the time you do spend online more meaningful.”
In other words, the metaverse is a digital reality. It will combine aspects of social media, augmented reality (AR), online gaming and crypto currencies so users can act and interact virtually, according to German broadcaster Deutsche Welle (DW).
“I’m fairly sure at this point that the metaverse is going to be a new economy that is larger than our current economy,” Jensen Hang, CEO of computer graphics chipmaker and metaverse investor NVIDIA said.
Facebook’s name has been closely tied to the metaverse term, but it does not have any exclusive hold on it.
“The metaverse isn’t a single product one company can build alone,” Facebook Reality Labs Vice President Andrew Bosworth and Nick Clegg Facebook VP, Global Affairs said in a release. “Just like the Internet, the metaverse exists whether Facebook is there or not. And it won’t be built overnight. Many of these products will only be fully realized in the next 10 to 15 years. While that’s frustrating for those of us eager to dive right in, it gives us time to ask the difficult questions about how they should be built.”
What is metaverse technology?
As Clegg and Bosthworth noted, a lot of potential metaverse products haven’t been fully realized yet. The company is starting to put metaverse-adjacent tech to work, however. In August it began testing Horizon Workshops, an app that allows users wearing Facebook’s Oculus Quest 2 VR headsets walk into virtual offices as avatars and take part in meetings. People can still see their computer screen and board while operating the headsets. Facebook announced it plans to hire 10,000 employees in Europe during the next five years to help build the metaverse, The Wall Street Journal reports.
“We develop technology rooted in human connection that brings people together,” Facebook said in its release. “As we focus on helping to build the next computing platform, our work across augmented and virtual reality and consumer hardware will deepen that human connection regardless of physical distance and without being tied to devices.”
Meanwhile, video game companies and other technology businesses are trying to create their own metaverse platforms and get to the forefront of what could be a significant revenue-generating industry. Other examples of metaverse-adjacent ventures include Epic Games, Inc. hosting a concert through its Fortnite video game during the COVID-19 pandemic. The event attracted more than 12 million people. In May, gaming company Roblox Corp. hosted an experience celebrating Gucci’s 100th anniversary where people could purchase limited-edition items for their avatars. Roblox also hosted a Twenty One Pilots concert in September.
It’s anyone’s guess how much money can be made within the metaverse, but if the video game business any indication, there’s a lot of upside for financial gain, according to Jeffries analyst Andrew Uerkwitz.
“People are willing to spend $80 billion-plus annually on virtual goods,” he told The Wall Street Journal. “(The revenue generated in the metaverse) could be very, very large.”
Companies will have to overcome some obstacles before they begin counting their metaverse money, however, according to analysts. Latency, how long it takes for data to move from one point to another and back, isn’t fast enough yet to support the metaverse concept, Jeffries said in its report. Also, virtual currencies require further evolution so they develop metaverses as marketplaces.
Meanwhile, any tech company interest in becoming a major metaverse player will need strong video game operations, according to Michael Wolf, co-founder and chief executive of consulting firm Activate, Inc. Technology companies should be prepared to spend significantly in order to expand their gaming divisions so they can keep pace in the metaverse competition, he said at The Wall Street Journal’s recent Tech Live conference.
Zuckerberg appears to have no problem spending what it takes to put Facebook at the forefront of the metaverse, however. The company already said its spending on Facebook Reality Labs will drop its operating profit by about $10 billion this year. The company’s total expenses could also increase by as much as $27 billion next year, The Wall Street Journal reports. Zuckerberg sees it as a long-term investment that will eventually pay off though.
“I expect this investment to grow even further for each of the next several years,” he said. “If you’re in the metaverse every day, then you’ll need digital clothes and digital tools and different experiences. Our goal is to help the members reach a billion people and hundreds of billions of dollars of digital commerce.”
Why do people want to be in the metaverse?
In some ways, a lot of people have already experienced the metaverse—or a least an aspect of it. Social media platforms, VR, online gaming and the cryptocurrency world have been around for years and are iterations of the metaverse. Additionally, world-building and interactive games like Second Life, Fortnite, Minecraft and Roblox also have metaverse elements in them. These games let people work together, go to events and use real money to buy virtual goods and services.
The difference between those worlds and the metaverse is the self-containment, according to DW. A user can play Fortnite or Minecraft in a sitting, but not both. The metaverse is envisioned as a place where someone could move throughout digital worlds seamlessly. There are even thoughts that a user could just have one virtual identity in the form of a digital avatar and the capital they have in one virtual world would work and have the same value in others. In the metaverse, everyone would pay with the same accepted digital currency.
“Instead of just viewing content — you are in it,” Zuckerberg told tech blog The Verge in July, contrasting the idea of the metaverse with standard “two-dimensional” webpages that currently populate the Internet.
The metaverse would also allow people to enjoy events from the comfort of their own home if they desired. After a long day of work, a person could enjoy a live concert with their friends, buy a souvenir t-shirt without having to go back out thanks to the metaverse.
What’s the downside of the metaverse?
Few technological advances come without some sort of concern. In the case of the metaverse, that concern is isolation. If people can be together without actually having to get together, what would that do to society?
John Hanke, founder and CEO of software development company Niantic recently wrote about such concerns on the company’s blog.
“A lot of people are talking about ‘the metaverse’ these days,” Hanke wrote. “Coming off 18 months of Zoom, Netflix, and Doordash, you can count me out — at least in the form that most folks are imagining. I’m not denying that the metaverse is a cool concept from a technology point of view; it comes from one of my favorite sci-fi writers, Neal Stephenson, who coined the term in his 1992 novel, Snow Crash. Along with the works of William Gibson, that book created the cyberpunk genre, in which characters spend time wired into a digital universe where they explore, socialize, fight, and (at least in the novels) save the world from villainous plots.
“The concept reached one of its most complete expressions in Ernest Cline’s Ready Player One, where virtually everyone has abandoned reality for an elaborate VR massively multiplayer video game.”
Hanke went on to acknowledge that while tech and gaming companies want to bring this vision of the virtual world to real life, the novels he mentioned were mean to serve as “warnings about a dystopian future of technology gone wrong.” There’s still room for technology in people’s everyday lives, but it was never meant to completely replace human interaction, he went on to say.
“(At Niantic), we believe we can use technology to lean into the ‘reality’ of augmented reality — encouraging everyone, ourselves included, to stand up, walk outside, and connect with people and the world around us,” Hanke wrote. “This is what we humans are born to do, the result of two million years of human evolution, and as a result those are the things that make us the happiest. Technology should be used to make these core human experiences better — not to replace them.”
What is the difference between metaverse and multiverse?
Between “multi”, “meta” “omni” and “uni”, it can be tough to keep so many “verses” straight! When it comes to metaverse versus multiverse however, the differences lie within the user experience. As previously explained, the metaverse is a digital reality—a virtual place where people can meet up with others, play games, shop, etc. The metaverse would not necessarily limit someone to one virtual platform at a time. Facebook, video game companies and tech businesses are all currently working to develop the tools and products necessary to become the foremost voice in the metaverse experience.
The multiverse however is more of where we are now from a tech capability standpoint, according to TechCrunch.
“In 10 years, we will have undergone a paradigm shift in social media and human-computer interaction, moving away from (two-dimensional) apps centered on posting content toward shared feeds and an era where mixed reality (viewed with lightweight headsets) mixes virtual and physical worlds,” TechCrunch’s Eric Peckham wrote. “But we’re not technologically or culturally ready for that future yet. The ‘metaverse’ of science fiction is not arriving imminently.”
Instead, it’s up to the virtual worlds of multi-play games from “old-fashioned” platforms like cell phones, tablets, computers and gaming consoles to serve as “stepping stones” to the metaverse. It is elements of the multiverse like gaming and social media coming together that will create the virtual worlds that Zuckerberg and other envision. The hope is however that the transition will be gradual and the metaverse will run in tandem with the physical world rather than be a separate entity.
“Multiverse virtual worlds will come to function almost like new countries in our society, countries that exist in cyberspace rather than physical locations but have complex economic and political systems that interact with the physical world,” Peckham wrote.
Peckham also projected that within 10 years, the multiverse-metaverse evolution will lead to people socializing in virtual worlds that evolved from games just like the would on social media platforms. Friends building things in virtual worlds will become more common and major happenings in popular virtual worlds will become pop culture news stories.
Currently, 75% of U.S.-based Facebook users are on the site every day. Meanwhile, Instagram (63%), Snapchat (61%), YouTube (51%) and Twitter (41%) are quickly becoming part of people’s daily routines as well. On the other hand, just 11% of people played a video game on any given day in 2016. That figure is expected to increase in the next few years as virtual worlds within these games offer more fulfilling social, entertainment and commercial platforms.
Meanwhile, companies are not waiting for the metaverse to be fully upon use before they begin to get involved. Venture capitalists are already funding startups who are building towards this virtual future like Klang Games, Darewise Entertainment and Singularity 6, TechCrunch reports. Additionally, startups are starting to provide the middleware for virtual economies as they grow and become more complex. More startup companies are expected to pop up in the coming years to provide this infrastructure as a service, according to Peckham.
“Over the next decade, these new platforms are going to start to unlock the kinds of experiences that I’ve wanted to build since before I even started Facebook,” Zuckerberg said during a recent earnings call.