The Metaverse: Why the Sceptics Are Wrong and the Hype Is Justified

Is the metaverse a load of hype or as transformative as technology companies, ‘visionaries’ and other advocates make it out to be? The concept is certainly being questioned and examined – the global editorial director of leading technology magazine Wired, Gideon Lichfield, was quoted recently as describing the current metaverse conversation as a “a terminological land grab” and said people “were trying to bring the … idea to a very different and very disparate set of experiences.”

Key audience segments also hesitate to fully embrace the universe of possibilities that proponents claim the metaverse is poised to deliver. United States market research and analytics organization Harris Poll conducted a survey late last year that found only 38% of ‘Generation Z’ respondents ¬– those born between 1997 and 2012 – think “the metaverse is the next big thing and will become part of our lives in the next decade”.

Whether the metaverse would impact positively on individuals’ lives is another issue of concern. Another Harris Poll survey conducted earlier this year reportedly found more than half (52%) of U.S. respondents aged 18-54 who were aware of the metaverse feared the space and its technologies would lead to neglect of their physical surroundings – and were particularly concerned they could lose existing relationships and the ability to form new ones.

Many observers are also concerned that the problems and challenges of social media will be replicated – and potentially amplified in the metaverse. Tiffany Xingyu Wang – Chief Strategy & Marketing Officer at Spectrum Labs, an AI-powered content moderation business, recently conducted an interview with Time in which she illustrated the traits of the metaverse that could deliver risks as well as benefits. “Immersiveness increases the impact of any toxicity,” she says. “Persistence increases the velocity of toxicity. And the interoperability part makes content very hard, because toxicity is very industry-specific. Dating, gaming and social platforms, for example, can have very different types of behaviors.”

However, these concerns are likely to be addressed as the metaverse concept matures and early-stage hype and challenges are replaced with sustainable business models, services and consumer experiences. There are even robust indications that industry participants are actively working to make sure the metaverse is a friendlier place for users than many existing social networks – Wang founded the OASIS Consortium comprising leaders of many prominent businesses to build “an ethical internet with safety, privacy and inclusion at its core,” and an aim to advance ethical standards across safe online communities, data privacy and diversity and inclusion.

Many respected analysts also believe the metaverse will deliver on its promise: for example, Gartner claims 25% of us will be replicating aspects of our offline lives in the metaverse for an hour a day by 2026. In addition, investment banks Goldman Sachs and Morgan Stanley have each put the addressable opportunity of the metaverse at no less than $8 trillion.

Here we will delve into the technologies that power the metaverse and why they provide a solid foundation for an immersive, persistent and interoperable environment that will live up to the hype. However, before we do that, here is a brief overview – and reminder - of the metaverse itself.

What Is the Metaverse?

As seasoned observers of the metaverse are by now well aware, science fiction author Neal Stephenson described in his 1992 novel Snow Crash a virtual world – the metaverse – in which digital avatars and software agents interact in a three-dimensional space. The concept exploded in late 2021 when Mark Zuckerberg introduced Meta – the new name of the Facebook parent organization – with the mission of bringing the metaverse to life and helping people connect, find communities and grow businesses.

A long list of technology industry luminaries and commentators have over the years coined their own descriptions of the metaverse (or metaverses – a number are springing up as companies seek to establish and brand their own versions); Alibaba Cloud describes the metaverse as ‘a shared virtual platform that people can access through different devices and move around on through a digital environment,’ and notes that the metaverse extends beyond virtual reality to encompass augmented reality, new mobile platforms, existing internet applications and a range of use cases.

So what technologies are successfully driving opportunity and innovation in the metaverse?

Transformational Technologies And How They Are Bringing the Metaverse to Life

Blockchain is effectively a cryptographically secured database shared among connected participants, with information transparent and available to each participant at the same time. The blockchain is also referred to as a distributed ledger, as information resides on several devices on a peer-to-peer network, where each replicates and saves an identical copy of the ledger, and updates itself independently.

Furthermore, because data is stored as blocks of information, with each block linked together in a ‘chain’ format, with new information updated as a block and attached to the previous version, creating an immutable, tamper-proof record. In addition, information cannot be updated on the blockchain unless a majority of the participants check and verify the credentials that are used. This consensus driven model essentially ensures that no one entity can take control of the data and create fraudulent transactions. Extended reality publication XR Today nominates some of the key use cases for blockchain in the metaverse as:

• Immutable in-game assets – these would become non-fungible tokens or NFTs that gamers could earn or sell, creating value outside the metaverse
• Self-identity authentication – blockchain technology can keep track of users as they navigate the metaverse
• Metaverse real estate – the blockchain can act as an immutable record of real estate activities in the metaverse

Non-fungible tokens (NFTs) use blockchain technology to provide proof of ownership of an item, and metaverse-related use cases are beginning to proliferate. For example, in a recent column, Shreyansh Singh, Head of Polygon’s NFT and gaming arm, Polygon Studios, pointed to the use of NFTs as deeds to virtual properties, giving owners exclusive access to enter and grant access to others, and discussed other opportunities, such as VIP access to real-world conventions, festivals and other events, and airdropping branded merchandise or allowing special access to fan-only content.

Fashion retailers are already embracing the opportunities presented by the metaverse – for example, in late 2021, Nike acquired RTFKT, a brand that leverages game engines, NFTs, blockchain authentication and augmented reality to create virtual products and experiences, while Gucci has embraced NFTs through initiatives such as SUPERGUCCI, a three-part series of ultra-limited NFTs co-created by Gucci's Creative Director Alessandro Michele and synthetic artists Janky & Guggimon. Another example – of many – is Dematerialized, a brand that provides what it describes as an experiential marketspace for digital fashion NFTs.

Virtual reality is, according to Wired, a technology by which computer-aided stimuli create the immersive illusion of being somewhere else – and which is popularly associated with clunky headsets.

Unsurprisingly, Meta-owned Reality Labs – whose researchers, developers and engineers create augmented and virtual reality technologies – are extremely positive, describing virtual reality as having "enormous potential to transform how we play, work, learn, communicate and experience the world around us. By incorporating interactivity and the viewer's literal point of view, virtual reality experiences reimagine the role of the audience as co-conspirator and active agent rather than a passive participant." The continued development of headsets and avatars will help extend virtual reality into the consumer marketplace.

Virtual reality gained considerable impetus in 2014 when Meta (then Facebook) bought Oculus, the maker of the Rift virtual reality device, for $2 billion. In the same year, Sony announced Project Morpheus, a virtual reality headset for the PS4 and Samsung announced the Samsung Gear VR headset. The technology continued to develop and in 2019, Facebook released Oculus Quest – helping provide a credible platform for Meta to springboard into the metaverse.

Virtual reality and close cousin augmented reality are categorized as extended reality, with the latter described by Investopedia authors as, “an enhanced version of the real physical world that is achieved through the use of digital visual elements, sound, or other sensory stimuli delivered via technology.” A practical example is the incorporation of augmented reality into retail catalog apps, enabling consumers to visualize how products such as furniture appear in real-world environments. Wikipedia notes that augmented reality “can be defined as a system that incorporates three basic features: a combination of real and virtual worlds, real-time interaction, and accurate 3D registration of virtual and real objects.”

Alibaba Cloud describes the use cases for augmented reality as “almost endless” and states that it will become the visual interface of digital information systems in the future, while proponents such as John Hanke, Chief Executive Officer of Niantic – the company best known for augmented reality mobile game Pokemon Go, which surpassed 1 billion downloads in 2019 – believe augmented reality will be where the real metaverse happens. “What’s different from the VR metaverse is that with ours you have this common structure that is the real world. The bits get tied to the atoms. And so you have these things that add information to the place that you’re in or give you useful functionality,” Hanke told Wired in an interview late last year.

3D technologies enable the metaverse by giving developers the ability to scan the real world and build models for use in the digital world. These technologies help create and maintain the photorealistic buildings and objects that comprise the metaverse and deliver a consistent experience to visitors and users. 3D technologies are developing quickly; for example, products such as NVIDIA’s Omniverse – a real-time 3D design collaboration and virtual world simulation platform available free to individual creators and artists – enable the connection of 3D worlds into a shared virtual universe. Omniverse combines graphics, AI, simulation tools and scalable computing to help designers and creators craft 3D assets and scenes from their laptops or workstations.

AI is poised to become ubiquitous across the metaverse, with some commentators seeing it infused into every layer – from hardware to software and communications. Its uses can range from AIOps – automating IT operations processes – to the creation of realistic avatars that represent users, including expressions, emotions and features, the continuous improvement of virtual worlds and human-computer interactions. Meta has listed a range of AI-powered applications and use cases that the organization is working on for the metaverse, including robotics – enabling digital avatars to pick and manipulate objects through models that bridge the gap between virtual reality and the physical world.

The ubiquity and growing maturity of these technologies, combined with innovation coupled with rigor and discipline born from experience with social media, will deliver a bright future for the metaverse – and silence the critics.

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The Metaverse: Why the Sceptics Are Wrong and the Hype Is Justified

What Is the Metaverse?

Transformational Technologies And How They Are Bringing the Metaverse to Life

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