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The Metaverse Equation:
Core metaverse concepts
M ≥ VR + AR + AI + B +e + X
Where....
- M: Metaverse
- VR: Virtual Reality
- AR: Augmented Reality
- AI: Artificial Intelligence
- B: Blockchain
- e: The internet
- X: the X factor (Experience, Connectivity, Enhanced Interaction)
Understanding the Hype
The excitement behind the metaverse is at peak levels.
Several companies have recently appointed Chief Metaverse Officers or similar roles. Some other key facts connected to the new buzzword:
- “Metaverse” has been quoted 700 times in the last calendar quarter of 2021 by CEOs and CFOs
- The metaverse represents a potential $8 trillion to $13 trillion opportunity by 2030, that could boast as many as 5 billion users
- 46% of CIOs say the metaverse is very important to their products and services strategy
What is the Metaverse and how do I get in it?
One common misconception associated with the metaverse is that it is a singular digital space that one can access via virtual reality headsets, much like the Oasis in the Ready Player One movie. While the immersive factor in this description stands true, its singularity nature does not.
The metaverse can be better understood when referring to it as the metaverse technologies. Put simply, technology trends like VR, AR, AI and blockchain are converging in new ways to make the metaverse possible and represent the metaverse technologies.
The end output of what the true metaverse is supposed to be, grows and changes with time. But the core features for the time being rely on a digital world that is immersive, persistent and decentralized.
Another interesting point of view is understanding the metaverse as the embodiment of the web 3.0, an upgrade of the internet as we know it. In the words of Meta’s CEO: “... you can think about the metaverse as an embodied internet, where instead of just viewing content — you are in it.”
The evolution of the web
However, despite the intrinsic link between them web3 and the metaverse are not the same thing. In the words of Cathy Hackl, globally recognized metaverse e: "For me, web3 is how people are connected in this future of the internet. Metaverse for me is how you experience it."
Is metaverse the same thing as virtual reality?
While immersive technology and specifically VR is by far the most graspable part of the metaverse and an important building block of it, it must be noted that they are not the same and they are not here to replace one another. VR just powers up the idea of the true metaverse.
Perhaps the confusion comes from the fact that presence and being immersed, two important aspects of VR technology are seen as a must in order to be in the metaverse.
However, this is not the case. The metaverse does not always have to be 3D and immersive. In fact, the metaverse can be accessed by different computing platforms, not only VR and AR, but also PC and mobile devices.
Entering the metaverse doesn’t necessarily mean having a head/body gear to immerse in virtual reality.In fact according to Louis Rosenberg, renowned XR pioneer sees the Augmented Metaverse (the merger of real and virtual worlds into a single immersive and unified reality) as the future of this technology.
So despite the close ties between VR technology and the XR concept of the metaverse, it is safe to say they are not the same thing.
What are NFTs and how do they relate to the metaverse?
NFTs (non-fungible tokens) are one-of-a-kind digital assets, built on blockchain technology that provide value to their owner. These digital assets can represent anything digital (digital artwork, a digital application, virtual reality assets) and allow content creators and distributors to monetize digital content.
Creating an NFT is usually related to the process of minting, which means that a certificate of ownership and originality is generated via cryptocurrency (usually Ethereum) and sold/granted to the new owner.
NFTs have an important role in the metaverse, as they offer a transaction mechanism for digital assets. These virtual marketplaces powered by NFT transactions have already been leveraged by brands in various industries, Nike being a good example of them.
NFTs are also being used to store digital artwork in metaverses such as Сryptovoxels, powered by the Ethereum blockchain. The FC Francisco Carolinum in Linz, Austria, is one of the players who has put together a virtual exhibition to trace the NFT history in art.
Media companies are also exploring the concept of NFTs as a framework for authenticating data and news, making use of proof of origin.
Takeaway
- Metaverse is not a place but rather a combination of technology trends like VR, AR, AI and blockchain converging in new ways to create and build new ways of interacting with one another and coexisting in a digital world.
- Virtual reality is one of the most prominent aspects of the metaverse, however the two concepts are not interchangeable.
- NFTs (non-fungible tokens) are one-of-a-kind digital assets built on blockchain technology which offers a transaction mechanism for digital assets.
The metaverse hype is real.
Although there seem to be plenty of definitions for the metaverse, some even contradicting each other, it is important to highlight one thing: the dystopian metaverse future is not how we should perceive this technology. Instead, we should leverage it and make the best for our daily interactions and or business. In fact, there are companies already taking advantage of the metaverse for their business.
But how can businesses use the metaverse?
More than 200 large and well known brands and organizations have established a presence in the metaverse such as Coca Cola, Samsung, Audi, Nike, Adidas, J.P Morgan, Gucci, Balenciaga, Louis Vuitton and many others.
Companies are using the metaverse primarily to engage with and sell to consumers aside from making a name for themselves as a first mover in this aspect.
The metaverse offers new opportunities for enriching customer experience, engaging with customers in a hip and alternative way, introducing a path for new branding channels.
Offering digital products and services, exclusive to the metaverse, has been getting a lot of attention lately.
However, it is important to note that the metaverse is ever changing and “under construction”, meaning that there is risk involved. It might be the fear of investing resources into something that could be obsolete and forgotten in the future or the eminent uncertainty of digital security in digital technologies. As with anything new technology, metaverse too requires adapted strategies from the business side to dwell into its waters.
Another point to mention is that each business has to evaluate for itself the potential and attractiveness of the metaverse and accordingly adapt its involvement strategy.
Not every company has to end up buying land and virtual estate on metaverse to state they’ve started their journey. Chances are many companies have already tipped their toes into the metaverse, by working on Proof of Concepts or projects that leverage on the building technologies of metaverse.
While businesses decide their level of involvement with the metaverse, having a core understanding of how this new technology is growing and effecting the way we connect, work and rethink the economy, is basic due diligence. This way, your business should be able to make informed decisions and not risk being left far behind to catch up with an ever changing virtual world.
What are the metaverse enterprise use cases?
Three of the biggest barriers to entering metaverse, according to senior executives is uncertainty on return on investment, lack of business model for the metaverse technology and lack of managerial capability to embed meta technology into business.
While the concerns they are putting forward make a valid point, informing themselves and keeping up to date with the metaverse enterprise use cases offered in the market, might help put these concerns at ease.
Some of the use cases are:
- Immersive (product) marketing
- Education
- Banking
- Digital Twins
- Recruiting
- Remote Collaboration
Immersive (product) marketing
Fashion giants are already taking advantage of immersive virtual assets or experiences that their customers can experience or own in the meta worlds. The world’s first metaverse fashion week in March of this year offered an immersive shopping experience where users could buy the digital twin and get the physical twin delivered to them. NFTs of course play a crucial part in the metaverse fashion; they’re often being used as part of loyalty programs.
Education
Whether it is hosting lectures in the metaverse or enriching learning material with the use of immersive technology, education is a good use case for the metaverse. It offers the opportunity to learn beyond boundaries, supplementing the learner with a hands-on experience rather than simply reading from a book.
Banking
Although some argue that banks presence in the metaverse is limited to mere representation spaces, Goldman Sachs and Morgan Stanley have estimated that the metaverse economy could be worth as much as $8 trillion. This puts banks in a very favorable position as it opens up opportunities to lay down the groundwork for the metaverse transactions, reinvent customer experience, connect with their customers in new ways and introduce new products/services such as digital assets, digital payments and digital twins.
Digital Twins
Often considered the building blocks of the metaverse, digital twins are digital copies of real life artifacts, processes or systems. They are often used in product development and simulation, especially in the manufacturing and automotive industry. The combination of the metaverse technologies with digital twins gives the opportunity to manage not only singular artifacts but also entire cities. Simulating “what if scenarios” for example catastrophe management is another important use case that is recently being implemented in several cities around the world.
Recruiting
One of the world's largest global communication groups is hosting recruitment services in the metaverse to enrich the employee experience for new joiners, offering a fresh view on the onboarding process. Other companies are already seeing metaverse as an additional channel to revamp their recruitment process, some of them have already hosted job fairs in the metaverse. Of course there is still a long way to go, but the attempts are there.
Remote Collaboration
Metaverse brings remote collaboration to another level, by offering an opportunity to collaborate with your colleagues across the world in an immersive environment. Except for the platforms that offer virtual collaboration in virtual meeting rooms or conference venues, metaverse is offering collaboration opportunities in the field of healthcare and manufacturing as well.
What should business leaders start doing?
Get up to speed
First things first, start getting aware about what the metaverse is, how it is defined by different field experts and what it really means - despite all the tech jargon. Understanding and keeping up with the metaverse requires little effort but brings huge advantages. Keeping up to date on how the market is changing and where its leading can help you create a clearer picture of your next strategic move.
Start exploring the meta worlds
The best way to understand virtual worlds is to immerse yourself in them. If Roblox, Minecraft, Sandbox or Decentraland are unfamiliar to you, it is time to take an effort and try what one can do with them. All you have to do is sign up for the platforms, create a digital avatar and start exploring. Once a meta user, you’ll be able to create a better picture of meta worlds.
Know your customer’s metaverse behavior
A strong incentive to pursue metaverse investment is to follow your customers. If your customers can already be found there, you can use the meta world as an additional channel to connect with them. Study your customers' metaverse behavior, survey their stance on the matter and decide on the role you as a company will play.
Align goals to Metaverse
To follow up, you as a company should define whether and how the metaverse technologies help your business goals and company vision. In this way it will be easier to guide your efforts in the right direction. Think whether you want to feed your short or long term goals first and test the metaverse waters accordingly. There is always the option to not participate in the metaverse, however it would be best to first consider how this may impact your business.
Re/Define ROI
Also, important to keep in mind during these times is a redefinition of the way you measure ROI from your attempts to enter the metaverse. Investing in new technologies does not necessarily guarantee success, but a good measure to take is to define the value you as a company would like to gain from it. Moreover,new business models can be fueled by metaverse, such as play-to-earn, create-to-earn, and learn-to-earn - meaning new opportunities arise for businesses across different industries that require redefinition of return on investment.
Keep an eye out for the competition
Your competition is an additional important factor that might influence your engagement with the metaverse. If they’ve already taken the first step towards this technology, it can still be used to your advantage. Learn from their experience, take notes and improve your own journey.
If on the other hand you still have the opportunity to list your company among the first movers in the metaverse, grab it.
Consult field experts
If you’d like to know more about the metaverse and how this new technology can be used for your business, there is always the opportunity to consult with field experts. Buying Sandbox land is not the only way to make moves towards the metaverse and be seen as a tech-driven and modern company. Our experts from PwC Austria are here to assist you on your metaverse journey.
Key points to remember:
- Business leaders should develop a strategic stance by defining metaverse goals and the role they want to play. They should also explore becoming metaverse users themselves. Metaverse poses urgent challenges that cut across firms, their employees, independent developers and content creators, governments, and, of course, consumers.
- There is no “one solution fits all” approach to how different businesses can engage with the metaverse; it is important for decision makers to follow up and have a core understanding of this technology to adapt their strategy accordingly.
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