Metaverse 101: An introduction to the Metaverse
Today we return to our Metaverse 101 series of posts, themetabite.com’s evolving guide to the Metaverse. If you're new to the Metaverse, this is the place for you. We explain the fundamental building blocks of the Metaverse, how they interact with one another, and where they might take us.
Here at themetabite.com we define the Metaverse as: ‘the ‘hyperconvergence of the physical and digital worlds’, that is, the merging of the real world and virtual worlds to the point at which they become indistinguishable from one another. As we discuss in our Barriers to the Metaverse series of posts there are some significant hurdles to be overcome, specifically obstacles related to the underlying network infrastructure, the open standards and interoperability, and the privacy and security required to deliver a hyperconverged physical/digital world. Consequently, it’s clear the Metaverse is unlikely to emerge as a fully realised, fully functional virtual world from day one, but rather a series of Web 3.0, Web 3.1, and Web 3.2 updates, culminating in a persistent, hyper-realistic, immersive, virtual world, that allows planetwide interactions, in real-time.
We have previously looked at who is involved in creating the Metaverse, what the Metaverse is, and when we might see the a fully realised Metaverse. Today, we look at where are we likely to see the Metaverse in all its glory. But what do we mean by ‘where’? We mean where in the world are we likely to see the Metaverse first? And what sectors and industries are likely to lead the way in the adoption of Metaverse technologies?
In fictional works, the Metaverse has focused on opportunity for immersive role-playing in virtual worlds (think the Middle Country, a Medieval fantasy game world in Tad William’s Otherland, or the OASIS, in Ernest Cline’s Ready Player One) and, to date, virtual reality (VR) and augmented reality (AR) experiences have been predominantly focused on gaming. The global virtual reality gaming market is already a multi-billion dollar industry, which is forecast to grow at a steady rate. Gamers have driven VR headset sales and we expect this trend to continue in the short term.
Asia-Pacific (notably China and Japan) currently dominate the VR gaming industry, closely followed by North America. So, while gaming continues to drive the VR market, we expect to see Metaverse development focused in the these regions. This is good news for gaming companies like Sony (Japan), Tencent (China), and Microsoft, who shocked the technology and gaming worlds earlier this year when it announced a $69 billion deal to acquire video game company Activision Blizzard. So were likely to see the Metaverse emerge in Asia-Pacific countries first, followed by North America. Countries such as South Korea and India are also expected to see an increase in demand for VR gaming due to technological advances and rising disposable income. While not as large as other regions, the Latin American, Middle East and African markets are expected to grow the fastest. The Middle East in particular is looking to incorporate both VR and AR into mega-projects like NEOM and Diriyah Gate.
So what sectors and industries are likely to lead the way in the adoption of Metaverse technologies? The global economy is dominated by the services sector and the largest service industries, by share of global market value, are: financial services; commercial real estate; e-commerce; health insurance; information technology; food; and telecommunications. It’s worth noting that telecommunications has a global market value of around $2 trillion, whereas the gaming industry, which is currently helping to drive the Metaverse, has a global market value of around $300 billion, which is around seven times smaller. The largest manufacturing sector industries are: construction; food production, oil and gas exploration and production; and automobile manufacturing.
The financial industry has, historically, been quick to adopt new technologies and the Metaverse appear to be no exception. US-based banking giant JPMorgan created a virtual lounge in popular blockchain-based 3D virtual world Decentraland in February of this year, and UK bank HSBC entered virtual world The Sandbox in March. We expect the financial services industry to continue to lead the way in the short term, providing new, virtual services to customers without having to invest in physical infrastructure and additional staff. The manufacturing sector may follow, with VR and AR helping to make manufacturing processes more efficient. Google. Is currently well placed to benefit from the sector’s investment in Metaverse technologies. Its Glass Enterprise Edition 2 is currently being used by the companies like GE, who have been using Google Glass to help mechanics assemble engines more accurately. The e-commerce and telecommunications sectors are all likely to benefit over shorter timescales.
But what do you think? Please leave a comment below!