Is Metaverse the next big thing? What is it, really? Who owns it? What will it mean to our businesses? Or is it all personal?
For now, Metaverse is more about questions surrounding it rather than firm and clear answers.
Imagine someone asking you about the internet in 1970s. It was all possibilities. The same is the case with Metaverse today with its many possibilities and scenarios. But if there is one thing that we can be sure about is that the Metaverse is going to change our lives, sooner than later. Therefore, we need to learn, explore and adapt.
What is Metaverse, really?
As of now, the Metaverse is best defined broadly, rather than exactly. Broadly, Metaverse is a shift of technologies that will possibly combine the physical world with the virtual cyberspace for an integrated and immersive experience. From 3D world, Augmented and Virtual Reality to digital economy which includes crypto currencies, NFTs assets, there are several technologies that are driving this shift.
In more simple words, Metaverse is both physical and digital. It’s a unified living experience where we can work, play, relax, socialise and transact in a completely virtual yet immersive environment.
But has it not existed already? Yes, there are quite a few examples such as Fornite, Second Life, several gaming apps which have already shown what a Metaverse could feel like. In the future, the integrations between these platforms will be wide and far and shape the Metaverse as a seamless experience touching many aspects of our lives.
It’s important to recognise the key differences between the what drives the internet today and connected world that will drive the Metaverse. While most of the interactions and transactions on the internet today are centrally controlled and monitored, metavers is based on a decentralised, peer-to-peer architecture. The internet today still offers digital payments that can be claimed in the physical world. On the contrary, metavers is going to be entirely driven by digital currencies and tokens. In the today’s scenario digital assets are not always transferable. In the Metaverse, you can buy or sell digital assets, just as you would do in the physical world. Metaverse is not a mere extension of the today’s internet but an explosion of possibilities surpassing its current limitations.
Why Metaverse now?
Not a day would pass without someone announcing an entry into Metaverse. Take a look at some recent developments for instance:
- Facebook has renamed it Meta
- Microsoft’s $69 billion acquisition of Activision to get into Metaverse
- HSBC buying a virtual plot of land in Sandbox
- Infosys launched a metaverse foundry to build use cases and educate customers
- China has set up a regulatory body for Metaverse companies
There are several factors driving the growth of metaverse. The pandemic has created a compulsive need for environment with connected, shared digital experiences. Users are looking to extend their experiences further through the meta verse. Several technologies such as AR, VR are now converging to enable immersive experiences. The internet penetration is peaking fast. The need for communities based on shared values and interests, and cutting across the physical boundaries of the world, is being increasingly felt. The ecosystem for participation is ripe, as the convergence of enabling technologies leads to rapid growth in metaverse use cases.
Metaverse Applications – what’s going to take-off in near future?
From facebook announcing a clear intent to create a metaverse of social interactions to increasing digital communities wanting to develop common virtual experiences in gaming, business, governance, learning and many other areas, social interactions are going to shift to the metaverse environment in near future.
Customer experience is increasingly becoming digital. From virtual product demonstrations to factory tours, enabled by the AR/VR aids, customer experience is set to become 360 deg digital. As more people join the metaverse through social, business or commercial spheres the platforms offer a whole new opportunity in terms of advertising and reaching out to new customers.
In fact many businesses are looking at metaverse as an opportunity to save on spends on physical space. For instance, Nike is building virtual stores and shift the experience completely to digital space.
Creating digital replicas of physical objects, equipment of systems is a great way to experiment, evaluate scenarios and develop simulations – all made convenient in the metaverse. By enabling digital twins, metaverse is set to accelerate R&D, smart manufacturing, learning and development.
New business platforms
Metaverse is set to become a complete platform in itself. Take the example of Omniverse, a platform by NVIDIA, to collaborate, interact and develop products in the virtual world. The platform is set to revolunise the marketplace by connecting researchers, engineers, developers and users from around the world in a whole new way. Sooner, than later, this will be the new normal of conducting business.
Digital products and merchandise
Digital merchandise is already a huge market in China where users buy stuff for their avatars, starting from clothes, glasses to makeup and cosmetics. As more users join the metaverse, the use of digital products is bound to grow. From shoes to sports goods, the ecosystems for digital goods is fast evolving. E-commerce platforms will have to evolve and the shopping experiences are set to change drastically in near future.
Hype or reality?
Like all technology forecasts where we tend to overestimate the impact of technology in the short term, Metaverse too could be a hype given its very early stages. The technology adoption will happen in the long term. However, there could be several disruptive developments in the short term, which present ample and significant opportunities. The shifts in some domains, such as gaming, finance, shopping could be much faster than expected.
Take a look at some $ statistics:
- Annually, almost $54 billion is spent on virtual goods such as avatars, digital merchandise etc. which is more than double the amount spent on buying music
- Market for AR/VR/Mixed Reality is estimated at # 60 bn, annually
- NFTs saw a $2.5 billion increase during the peak of the pandemic.
- In just three months, Decentraland Games’ casino earned $7.5 million
- Robolox users spent $650+ mn on the virtual currency of the platform
The JP Morgan report expects the Metaverse opportunity to cross $1 trn in the next 3-5 years. Naturally, no company wants to be left out and everyone is trying to ride the wave.
For instance, check the exponential rise in number of Apps adding/updating the Metaverse keyword in their names:
Clearly, metaverse offers a huge opportunity. What should be your strategy?
The Metaverse technology and user ecosystem is evolving rapidly and soon expected to explode. A planned strategy based approach may not work in the metaverse. Success will depend on rapid experimentation, failing fast and evolving quickly. Integrations across technologies will matter. But what will separate the winners is the ability to imaging a whole new reality, albeit virtually.
Helping you to stay ahead…
Crafsol has developed a Center of Excellence in developing strategies for evolving and adopting to a metaverse-centric business environment. We are of the opinion that a a ‘wait and watch’ strategy for the metaverse is only going to put your business at risk. What’s required is thinking ahead to aggressively imagine and adopt to the metaverse, educate users to build unparalleled competitive advantages.
If you want to explore what the future of your business will look like….connect with our experts on the metaverse. Drop an email to firstname.lastname@example.org