The metaverse: you’ve heard of it. That futuristic, decentralized, 3D version of the web that’s supposed to make the internet great again. Or at least that’s the promise.
As word of the metaverse spreads, a vast number of companies from across industries have been quick to announce their glorious entrance into humanity’s newest medium. What most users are unaware of —and most companies are eager to omit— is that much of the technology needed to construct the metaverse doesn’t exist yet.
In this two-part series, we’ll look at the challenges for building a fully functional and truly open metaverse that exists beyond today’s hype cycle.
Let’s Be Clear: The Metaverse Isn’t Here Yet
Talking about the metaverse has become one of the latest trends in the tech space and beyond, too. The term has become so ubiquitous when referring to the future of media and communications that almost every company wanting to look like they own their future has announced some kind of metaverse-related action.
Fashion brands like Nike (NYSE:NKE) have made headlines for releasing virtual sneakers in the form of NFTs or hiring a full-time metaverse director. Many other consumer brands have either created virtual goods in the form of NFTs or launched brand experiences within a virtual platform.
Related: What Is An NFT?
Silicon Valley has been quick to appropriate the term and jump on the metaverse bandwagon. Alphabet (NASDAQ:GOOG) (NASDAQ:GOOGL), Apple (NASDAQ:AAPL), Microsoft (NASDAQ:MSFT), Nvidia (NASDAQ:NVDA), Qualcomm (NASDAQ:QCOM) and many other tech giants have all announced big plans to enter the metaverse economy, accompanied in many cases by heavy investment.
Facebook is the most extreme of these examples, rebranding itself to Meta Platforms Inc (NASDAQ:META) in an effort to present itself as a metaverse company first.
While most people today have a vague idea of what the metaverse means, hype around the term has led many consumers to believe the future has arrived, while in reality it's further down the road.
In broad terms, the metaverse is generally understood as the next stage of the internet, where interaction between people is made easier through the use of immersive 3D technologies like augmented reality and virtual reality in a way that’s more akin to real life.
Blockchain, Web3, NFTs and other elements of the decentralization economy are often tied to the idea of the metaverse in various ways, though many accounts fail to explain how these elements are tied to the idea of immersiveness in 3D environments.
For Yat Siu, co-founder and executive chairman of Animoca Brands, these definitions stop short of what the metaverse could actually become.
“We define the metaverse as an open, decentralized network of systems and environments connected by true digital ownership, interoperability, and community governance,” says Siu.
His company owns The Sandbox, an Ethereum-based NFT game that allows users to buy virtual land and customize it with playable games and experiences. The platform has become one of a few virtual worlds often referred to as “a metaverse,” along with others like Decentraland, Roblox (NYSE:RBLX) and Fortnite.
What many people struggle to understand is that much of the infrastructure and technology needed to reach the definition provided by Siu has not been not developed.
A key idea in his definition is the true ownership of digital assets that can be moved from platform to platform, tied to a digital identity enclosed in an avatar.
Virtual 3D worlds where users can interact via avatars and exchange in-game goods have existed for almost two decades. "World of Warcraft," a massively multiplayer online game, has many of the characteristics of what today would be called “a metaverse” and had already reached 12 million users by 2010. The game was developed by Activision Blizzard (NASDAQ:ATVI), which is to be acquired by Microsoft in a $68.7-billion deal.
Economist Marc Arbonés, who’s the editor and founder of Altcoins Mastery, has been studying the metaverse since the term exploded across media.
The metaverse isn’t fully operational yet because the supporting technologies for its existence are still in development, he tells Benzinga.
“We can, however, appreciate platforms with metaverse-like components, such as video games that use virtual (VR), Mixed Reality (MR), and augmented reality (AR), host in-game events, and create virtual economies using cryptocurrencies,” he says.
Today’s internet and cloud computing networks cannot support a fully functional metaverse. Available platforms can produce semi-immersive experiences that allow people and automated entities to interact in digital spaces, but that’s about it.
The technology that enables our devices, connects them to a network and delivers content in the ways needed for the metaverse to fully flourish is still in R&D stages.
The Metaverse Is Not A Technology, It’s ‘A Cultural And Societal Shift’
From a technology standpoint, we need faster mobile internet with greater bandwidth and upgraded infrastructure for cloud computing.
Other types of technology need to be improved too, like real-time 3D rendering, spatial computing software (to better interact with the real world) and human interface devices that are comfortable, easy to use and affordable.
But the metaverse is a lot more than its enabling technologies.
The “real” metaverse, says Animoca’s Siu, will be open and will serve the interests of the majority. It will have digital property rights at its core, “making it a genuine — and modern — society.”
The people who engage with the metaverse are as important as the infrastructure that allows it to function.
Today, adoption of metaverse-like technologies continues to be in its early stages, according to Tyler Moebius, CEO of SmartMedia Technologies, a studio and consultancy firm that offers NFT and Web3 services to businesses.
“If you were to compare the metaverse to internet phases, currently the metaverse is in the dial-up/Palm Pilot phase,” says Moebius.
In Siu's definition of the “real” metaverse, openness becomes a key factor. Being able to seamlessly move one’s avatar and virtual belongings across platforms requires, first and foremost, a willingness among its developing actors to embrace decentralization and an open-source mentality.
The “open metaverse,” in that sense, is still nascent, says Animoca's Siu, who understands the transition to a Web3, decentralized internet as similar to the transition of societies from feudalism to more democratic systems with their accompanying property rights.
“The adoption numbers of those emerging political systems started out small but ultimately open markets and open societies became the standard. In the Web3 space we are still in single-digit percentage of adoption but the per-user engagement is higher,” says Siu.
The shift towards an open metaverse powered by Web3 should not be viewed solely from the angle of its enabling technology, but as “a cultural and societal shift” that should be understood through a socioeconomic and political lens.
“The actual implementation of the open metaverse will come from the people themselves as they adopt the technology in sufficient numbers and become active participants,” says Siu, whose company Animoca Brands is also a VC investor in the sector with over 340 investments in its portfolio.
The technological issues that stand between us and the fully developed metaverse are being addressed, he says. Mass adoption of these technologies is maybe even more important than the technologies themselves for the metaverse to actually work as it’s being touted and envisioned today.
Siu says that critical user adoption will occur in the next 18-24 months, and a lot of this will be driven by games.
“When blockchain games look and feel like traditional games then users are more likely to adopt them and in the process gain access to their specific benefits, including the store of value, digital identity, ownership of assets and the economic freedom that is accompanied by ownership.”
Photo via Shutterstock.
