Metaverses: A comprehensive overview

Published in

Paradigm

33 min readFeb 2, 2023

In this report, the metaverse is explored in several aspects, starting with an overview of the definition, origins, and key features of the metaverse, then exploring the technological aspect of the metaverses, and then the platforms and key companies in the area. Afterward, the criticism, challenges, trends, and prospects of the metaverse are discussed.

Part I: Overview
Part II: Technology
Part III: Platforms & companies
Part IV: Criticism & challenges
Part V: Trends & prospects

Part I: Overview

Definition

Metaverse, a combination of the prefix “meta” (implying transcending) with the word “universe”, describes a hypothetical synthetic environment linked to the physical world.

The definition of the metaverse varies, depending on point of view and purpose. However, the commonly discussed metaverse is a virtual world that is like the real world: it is a space for interacting with other users. Today we describe the metaverse as a fully immersive internet, where we will be able to access augmented and virtual reality and interact with all sorts of environments using persistent avatars and innovative digital technology. The metaverse is the next iteration of the internet: a single, shared, immersive, persistent, 3D virtual space where humans experience life in ways they could not in the physical world.

“A massively scaled and interoperable network of real-time rendered 3D virtual worlds that can be experienced synchronously and persistently by an effectively unlimited number of users with an individual sense of presence and with continuity of data, such as identity, history, entitlements, objects, communications and payments”, — Matthew Balldefined defines the metaverse in his essay.

The metaverse has the potential to extend the physical world using augmented and virtual reality technologies allowing users to seamlessly interact within real and simulated environments using avatars and holograms. Virtual environments and immersive games (such as Second Life, Fortnite, Roblox and VRChat) have been described as antecedents of the metaverse and offer some insight into the potential socio-economic impact of a fully functional persistent cross-platform metaverse.

The novel depicts the metaverse as a virtual reality (VR) space that utilizes the internet and augmented reality (AR) via avatars and software agents. The metaverse has been described as a new iteration of the internet that utilises VR headsets, blockchain technology and avatars within a new integration of the physical and virtual worlds.

Some authors classify the definitions of the metaverse into four types — environment, interface, interaction, and social value — by summarizing each characteristic of the metaverse. Similarity to the real world is a representative example of classifications that distinguish the types of metaverse.

Environments: Metaverse environments include realistic, unrealistic, and fused environments. The fused environment reflects some unrealistic elements based on a realistic environment. The realistic metaverse faithfully reflects geography and physical elements according to the designer’s purpose and interpretation. This method has the advantage of being able to deliver experiences in a way that is similar to reality (e.g., library orientation, museum visits)
Interface: From the interface point of view, there are 3D, immersive, and physical methods. Although 3D is not an essential element of the metaverse, many definitions of the metaverse use the expression “3D virtual world”. Most metaverse environments are composed to have 3D form, although there are differences in the degree of detail. The 3D method has the advantage of increasing realism, but it has a disadvantage in terms of service continuity.
Interaction: Interaction in the metaverse is classified as social networking, collaboration. Effectively redefining and utilizing the experience of social networking in the metaverse is difficult. Furthermore, interest in value creation through collaboration beyond individual VR experiences is increasing. Persona dialog maintains a natural conversation by reflecting the characteristics of NPCs.
Social value: An important question about the value of the metaverse is whether there is a new value for society in the metaverse environment. Sustainability and interdisciplinary study are important factors in providing social values and maintaining a robust metaverse. Sustainability is an essential factor for the metaverse. The metaverse serves as a tool to complement the real world and serves as the target of the metaverse itself.

Metaverse with the environment, interface, interaction, security and privacy (Source: Park & Kim, 2021).

Metaverse vs. multiverse vs. omniverse

As interest in the metaverse continues to grow, the discussion about the terminology used to describe the concept of immersive 3D digital environments is also gaining momentum. Three terms — metaverse, multiverse and omniverse — are sometimes used interchangeably, but they take different approaches to virtual reality.

Metaverse implies a level of deep interoperability across worlds and platforms in which assets and characters flow from one to another.
Multiverse contains multiple independent worlds that share little, if any, data. Examples include two games with different rules, equipment, sign-in systems and friends lists.
Omniverse could refer to the sum of all worlds or, when capitalized, to a specific industrial metaverse platform from chipmaker Nvidia.

Metaverse vs. multiverse vs. omniverse. (Source: Techtarget)

Key features of the metaverse

1. Incorporation of avatars: Creating digital avatars of oneself as a way to express one’s emotions and feelings uniquely is one of the core concepts of the metaverse. Each person has their own digital identity, which can be static or animated and is distinctive to them. Digital avatars are a unique way to express oneself since, in addition to being precise reproductions of your actual form, they may also be recreations of your favorite celebrities or something completely original.

2. Blockchain-based operations: Blockchain allows consumers to safeguard their virtual assets and gives them digital proof of ownership, making it a crucial component of the metaverse. The metaverse is experiencing a growth in data volume, value, and significance of security and dependability. Due to the numerous drawbacks of centralized data storage in systems like database management systems (DBMS), the metaverse concept is incomplete without blockchain. Without the influence of a centralized organization, the blockchain-based metaverse enables access to any digital place.

3. The use of virtual land (parcels): In the metaverse, land can be purchased by anybody for cryptocurrencies. The land is an NFT, a blockchain asset class that one cannot trade for other things. Size refers to the fundamental number of pixels in a plot of metaverse real estate.

4. Immersive experiences (AR and VR): Participants in the metaverse will be able to have more immersive experiences that converge reality and the virtual world by utilizing mixed reality and AR/VR technologies.

5. Intersection with artificial intelligence (AI): As the driving force behind corporate research in fields including content analysis, self-supervised speech processing, robotic interactions, computer vision, and whole-body posture estimation, AI is crucial to the metaverse. The business applications of the metaverse can be delivered using AI in several different ways. AIOps, a subfield of AI, employs machine learning to assist companies in managing their IT infrastructure.

6. Decentralized Autonomous Organizations (DAOs) for governance: A DAO is a governance body that uses blockchain and smart contracts to reach a consensus for various decisions. To ensure that everyone in the organization has the opportunity to participate in the governance process, all decisions in DAOs continue to be governed by proposals and voting processes. The procedure is vital for assisting participants in casting ballots on significant decisions on managing metaverse resources.

7. Reliance on Human-Computer Interface (HCI) technology: To take part in specific activities, a human and a computer exchange information through a process called HCI. The most crucial benefit of human-computer interaction is that it aids groups needing formal training and information on how to connect with computing systems.

8. A focus on social interactions: Humans communicate and interact in the metaverse through avatars and visual representations of a user. Users can engage and converse both with the metaverse and with other users. The setting for these exchanges is cyberspace, which serves as a representation of the real world.

9. Supporting Web3: The idea behind Web3 is to usher in a new era of the internet. It is the progression of user ownership and control over their online material, digital assets, and online personas. Web3 and the Metaverse technologies work in perfect harmony with one another. Web3 may provide the foundation for connectivity in the metaverse because the metaverse is a virtual environment and prefers a decentralized web.

History

In 1838, scientist Sir Charles Wheatstone outlined the concept of “binocular vision,” where you combine two images — one for each eye — to make a single 3D image.

In 1935, American science fiction writer Stanley Weinbaum published the book Pygmalion’s Spectacles, in which the main character explores a fictional world using a pair of goggles that provided sight, sound, taste, smell, and touch.

In 1938, the term “virtual reality” appears for the first time in French dramatist Antonin Artaud’s essay “The Theater of Cruelty (First Manifesto).”

In 1956, Morton Heilig created the first VR machine, the Sensorama Machine. This machine simulated the experience of riding a motorcycle in Brooklyn by combining 3D video with audio, scents, and a vibrating chair to immerse the viewer.

In the 1970s, MIT created the Aspen Movie Map, which enabled users to take a computer-generated tour of the town of Aspen, Colorado.

Metaverse history timeline. (Source: Techtarget)

In 1992, the term metaverse was coined by author Neal Stephenson in his sci-fi novel Snow Crash, and work on the technologies that underpin a virtual reality-based internet date back decades. Also in 1992, Jason Lanier, CEO of virtual reality headset maker introduces virtual reality music instruments (VRMI) for the first time in his performance “Sound of One Hand” in Chicago.

In the early 1990s, Sega introduced VR arcade machines like the SEGA VR-1 motion simulator, which users enjoyed in many arcades.

In 1998, Sportsvision broadcast the first live NFL game with a yellow yard marker, and the idea of overlaying graphics over real-world views quickly spread to other sports broadcasting.

In 2010, Palmer Luckey, entrepreneur and inventor, created the prototype for the Oculus Rift VR headset.

In 2011, Ernest Cline released the book Ready Player One.

In 2014, Facebook acquired Oculus VR a $2 billion deal. At that time, Facebook founder Mark Zuckerberg stated that Facebook and Oculus would work together to build out the Oculus platform and develop partnerships to support more games. Also in 2014, Sony and Samsung both announced they were creating their own VR headsets, and Google released its first Cardboard device and Google Glass AR glasses.

In 2016, Microsoft’s HoloLens headsets hit the market which gave us mixed reality (AR and VR) for the first time. Also in 2016, people around the world were running around in their neighborhoods trying to catch Pokémon using the Pokémon GO augmented reality game.

In 2017, IKEA joined the metaverse mix with their innovative Place app, which allows you to select a piece of furniture and view what it looks like in your home or office.

In 2019, users on Roblox’s platform who create items for purchase by other users earn $110 million. Over half of Roblox users purchase customized avatars each month, meaning that money earned on the platform often stays within the Roblox universe economy.

In 2020, Apple added Lidar (Light Detection and Ranging) to iPhones and iPads, creating better depth scanning for better photos and AR, and also paving the way for mixed-reality headsets in the future. Also in 2020, Second Life has nearly one million monthly active users. Decentraland is open to the public.

In 2021, Facebook changed its name to Meta, indicating its focus on shaping the future of the metaverse. Two companies also launched smart glasses (Ray-Ban Stories) or highly portable virtual reality headsets that look like sunglasses (HTC’s Vive Flow). Also in 2021, Fortnite has 350 million registered users. Furthermore, Sotheby’s holds an NFT art show at a virtual replica of its iconic London galleries in the Decentraland metaverse.

In 2022, Siemens and Nvidia partner on the industrial metaverse.

Part II: Technology

Broadly speaking, the metaverse is a digital ecosystem built on various kinds of 3D technology, real-time collaboration software and blockchain-based decentralized finance tools.

The Corporate Hitchhiker’s Guide to the Metaverse, by Boston Consulting Group, designates the following three categories of technologies that define the metaverse:

metaverse worlds (M-worlds);
extended reality (XR): augmented reality (AR), virtual reality (VR) and mixed reality (MR); and
Web3 and virtual assets.

M-worlds are immersive applications that offer companies new ways to reach audiences. M-worlds can run on mobile devices as well as PCs and AR/VR headsets. Web3 is in its early stages but, according to the guide’s authors, “is already powering a vibrant virtual asset economy that includes cryptocurrencies, NFTs [non-fungible tokens] and smart contracts.” The authors see “much of the value of the metaverse may ultimately lie not in consumer but in business applications.” Those applications may include virtual meetings, training sessions, new-product designs and providing virtual tours of homes to prospective customers.

The metaverse lies at the intersection of three technologies and user bases. (Source: BCG)

XR (AR, VR, and MR) technological advances are facilitating the shift from 2D to 3D by providing more realistic experiences and digital displays that are better synchronized with head movements. Indeed, surveys have found that the two biggest barriers to wider adoption of XR are the user experience and limited content, both of which are improving fast.

Sales of AR, VR headsets are projected to reach almost $90 bllion in 2025. (Source: BCG)

AR/VR/MR hardware, whose bulk has been a barrier to wider adoption, is advancing quickly, with reductions in headset weight and size in each new iteration. Product roadmaps point to eventual design specs similar to a pair of eyeglasses. Near-term developments promise integration of eye tracking inside the headset, which will allow computing power to be focused exactly where the user is looking, saving on power at the periphery of vision. By 2025, this almost $50 billion market will be equally split between consumer and enterprise buyers, reflecting the productivity benefits stemming from AR/VR augmentation.

AR/VR market should approach $50 billion by 2025. (Source: BCG)

Web3 is already powering a vibrant virtual-asset economy that includes cryptocurrencies, NFTs, and smart contracts. Venture capitalist Matthew Ball estimates that more than $50 billion in virtual goods were purchased in 2021 using “traditional” mobile or credit card processing on web-based applications or on app platforms, such as Apple’s App Store. There are some 30 million NFT wallets, including 1 million active wallets, which spent some $40 billion on NFT purchases in 2021.

Technologies that power the metaverse

Technologies are the enablers that drive the transition from the current Internet to the metaverse. There are eight enabling technologies: Extended Reality, Brain-computer interfaces, Artificial Intelligence, Blockchain, Computer Vision, IoT and Robotics, Edge and Cloud computing, and Future Mobile Networks.

Top technologies for metaverse development. (Source: techtarget)

1. Artificial intelligence: AI plays a core role in developing bots and chatbots and brings intelligence to computer vision in the real world. But only 10% of companies report significant AI benefits from their deployments. AI’s processing capabilities could create metaverse avatars, enhance the characteristics of digital humans to make them more life-like, and be applied to non-player characters that converse with players in gaming environments.

2. Internet of things: The Blockchain Council refers to IoT as “an important pillar of the metaverse infrastructure.” The metaverse and IoT integrated can, for example, “unlock new opportunities for industrial domain, individual needs and social requirements,” the council reported. IoT would allow virtual spaces to seamlessly access and interact with the real world while the metaverse would provide the 3D user interface for the IoT device cluster, resulting in what the council calls “a user-centered IoT and metaverse experience.”

3. Extended reality: AR, VR and MR technologies will transform the way businesses visualize and use data by shifting from 2D to 3D for more realistic experiences and digital displays that better synchronize with head movements, according to BCG. When AR glasses become more mainstream, computer vision will help people understand the environment and locate the right information. Extended reality (XR) is already being used, for example, in Microsoft’s HoloLens, allowing users to experience 3D holographic images as though they’re a part of their environment.

4. Brain-computer interfaces: Although the World Economic Forum (WEF) includes brain-computer interfaces on its list of technologies that will shape the metaverse and acknowledges that BCI is “perhaps the most far-reaching vision for the metaverse” as the technology aims to replace traditional control screens and physical hardware. Still, the forum noted that BCI and XR combined “position themselves as the next computing platforms in their own right.”

5. 3D modeling and reconstruction: 3D reconstruction captures the shape and appearance of real objects and will make the metaverse a reality. The technology includes tools like 3D modeling to provide a three-dimensional framework and prototype of a specific process or product. For perspective, the global 3D reconstruction technology market is expected to double over the next several years to roughly $2 billion in 2028, according to a SkyQuest Technology Consulting report.

6. Spatial and edge computing: Spatial computing combines AR, VR and MR to interact with the real world and edge computing can provide a quick response time to user actions that mimic reality and keep users immersed in the metaverse. Any kind of spatial technology, including computer vision, is very relevant to metaverses,

7. Blockchain: Discussions center on how the technology can be used to secure digital content and data in the metaverse. Blockchain could a play role in decentralizing the metaverse to avoid delays or single points of failure.

Hardware, software, storage

Hardware

Access points for the metaverse include general-purpose computers and smartphones, augmented reality, mixed reality, and virtual reality.

Dependence on VR technology has limited metaverse development and wide-scale adoption. Limitations of portable hardware and the need to balance cost and design have caused a lack of high-quality graphics and mobility. Lightweight wireless headsets have struggled to achieve retina display pixel density needed for visual immersion. Another issue for wide-scale adoption of the technology is cost. Current hardware development is focused on overcoming limitations of VR headsets, sensors, and increasing immersion with haptic technology.

While Meta currently dominates the VR headset market with their MetaQuest2, several other companies involved in metaverse are working on creating hardware for the metaverse, such as Samsung, HTC, Sony. The current primary goal of these companies is to create lighter VR sets at affordable prices to enhance customer experiences online.

The AR space is dominated by Microsoft’s HoloLens, Apple, Google, etc.

The role of hardware is not limited to just VR/AR headsets; the metaverse companies are also working on incorporating haptic feedback through sensors for when users interact with objects in the metaverse. Incorporating sensory feedback enables users to have a completely immersive experience. For example. Meta is currently working on robotic skin that works with sensors and AI to provide feedback whenever a user touches anything in the virtual world. These devices help blur the lines between the virtual world and the digital world.

Metaverse hardware can be split into further subcategories:

Visual and Audio Hardware: VR/AR headsets are being worked on by various companies, that are working on improving user experiences by creating high-quality optic displays and working on creating lighter headset designs.
Wearable Sensors: Sensors are going to play a huge role in enabling users to interact fully with their virtual surroundings. These sensors would need to be worn by users, and while this technology is currently still in development, users can still currently experience haptic feedback through controllers.
Creating Interactive Virtual Worlds: Metaverse companies are continuously working on creating and improving virtual spaces for users, they aim to create an interactive virtual world that allows users to interact, create 3D NFTs, sell digital assets on inbuilt marketplaces, and much more.

Software

There has been no wide-scale adoption of a standardized technical specification for metaverse implementations, and existing implementations rely primarily on proprietary technology. Interoperability is a major concern in metaverse development, stemming from concerns about transparency and privacy. There have been several virtual environment standardization projects. Factors such as the degree of interoperability among virtual worlds, data portability, governance and user interfaces will depend on how the metaverse pans out.

The metaverse is meant to be an immersive 3D space, similar to our real-life world. Companies such as NVIDIA and Unity are already working on creating solutions for developers to build real lifelike worlds. Such software would enable metaverse developers to easily create realistic landscapes and environments for end users.

The fundamental standards are needed to create the metaverse as a virtual world. There are several:

Universal Scene Description (USD) — an open and extensible ecosystem for describing, composing, simulating, and collaborating within 3D worlds, a specification for 3D computer graphics interchange created by Pixar and supported by Blender, Apple’s SceneKit and Autodesk 3ds Max. NVIDIA is adopting USD for their metaverse development tools, and believes that USD should serve as the HTML of the metaverse.
glTF is a specification for the efficient transmission and loading of 3D scenes and models by engines and applications created by the Khronos Group, an industry consortium developing royalty free open standards. In August 2022 it was announced that glTF 2.0 had been released as the ISO/IEC 12113:2022 International Standard.
OpenXR is an open standard for access to virtual and augmented reality devices and experiences. It has been adopted by Microsoft for HoloLens 2, Meta Platforms for the Oculus Quest, HTC for the HTC Vive, Qualcomm for the Snapdragon Spaces XR Developer Platform, and Valve for SteamVR.

Storage

Metaverses are vast, rich virtual worlds with a lot of 3D-designed objects that would require a large amount of data storage options. Undoubtedly cloud storage is the best option for metaverses, which creates an opportunity for metaverse companies to create customized storage solutions that would be able to fulfill the storage requirements needed for a large virtual space.

There would also be additional storage required by NFTs and other user-created objects such as avatars. These could be stored on decentralized systems that are Blockchain-based. That way, these user digital assets could be stored securely, as no third party would control the data.

Additional storage would be required for data generated by metaverse users while interacting with businesses online. Storing this data is extremely important as it can facilitate future marketing strategies for businesses. For example, tracking eye movements while inside virtual stores could help businesses understand which product is generating more interest.

Part III: Platforms & companies

Immersive and interactive multimedia style online games have been available for a number of years, allowing users to experience social interaction within a virtual world using VR headsets and avatars. Linden Lab’s multimedia platform Second Life that was launched in 2003, allows users to create and control avatars and socially interact within a virtual world, has been described as an antecedent of the metaverse. Other 3D interactive platforms such as Roblox and Fortnite have also been described as precursors to the metaverse, where the functionality allows users to create avatars and interact with other gamers within their own virtual universe. However, although these platforms have been available since the early and mid-2000s with large numbers of global users, in the context of the metaverse, are limited by their platform independence and functionality.

Roblox and Fortnite are M-worlds — immersive applications that offer brands the possibility of reaching new audiences in different ways. Able to run on mobile phones, tablets, PC browsers, and AR or VR headsets, they have multiple distinctive attributes.

The six attributes of M-Worlds. (Source: BCG)

M-worlds pursue multiple monetization models as they seek to build their virtual-asset economies. These include both traditional approaches, such as subscription, advertising, and in-app purchase models, and newer, metaverse-specific methodologies, including initial asset offerings, metaverse agencies, and advertising using metaverse-generated data.

According to Marty Resnick, vice president analyst at Gartner, metaverse platforms have five attributes: The platform’s infrastructure should enable interaction, be interoperable, immersive, able to manage identity and support the creator economy. Especially important is that metaverses are interoperable and not device dependent. Right now, however, they are very siloed, and that needs to be fixed. Gartner has predicted that by 2026, 25% of people will spend at least one hour a day in the metaverse for activities.

Metaverse platforms in 2022–2023

Decentraland: Decentraland is a web-based 3D virtual world platform that runs on the Ethereum blockchain. The platform was created in 2015 by Ariel Meilich and Esteban Ordano. Its first Initial Coin Offering (ICO) was in 2017, with a public launch in February 2020.
Sandbox: Sandbox is a community-driven gaming platform built on the Ethereum blockchain. Creators can monetize voxel assets. The Sandbox metaverse has its ERC-20 utility token, SAND.
Roblox: Roblox is a multiplayer online platform. Roblox said its vision is to give people a platform that empowers them to create their own experiences. Users can create and socialize in this immersive 3D world. Initially built as a website in 2006, Roblox is now accessible on various devices with millions of active daily users.
Altspace VR: Acquired in 2017 by Microsoft, the virtual platform enables the creation of virtual events and is part of the tech giant’s Mixed Reality division. Users can host a meetup, a show or a class.
BlueJeans: BlueJeans from Verizon is a video platform designed to optimize flexible work in enterprise and midsized businesses. In 2021, the company partnered with MootUp to reimagine “virtual events in the era of the metaverse with 3D, VR and AR immersive environments, avatars and AI chatbots.”
Cryptovoxels: Cryptovoxels is a virtual world gaming platform powered by crypto and Ethereum blockchain. It includes real-life infrastructure such as roads and buildings.
Gather: Gather is focused on video chat that builds a virtual layer over the physical world. It is an enterprise-specific offering that mimics an office construct and deeply integrates with video conferencing.
Metahero: Metahero from Web3 company Pixel Vault, is a universe where anyone can be a hero. The platform offers six different kits with avatars that can be customized and personalized. Metahero combines real utility tokens with ultra-realistic 3D technology to produce virtual three-dimensional objects. These objects are used for gaming, profile pictures, social media, fashion, and other utilities within metaverse ecosystems. The idea is to offer users a gateway to the virtual opportunities of the future while pioneering cutting-edge 3D tech. A token-based economy (HERO is the native token) supports the Metahero marketplace. Metahero is a decentralized platform that runs on Binance Smart Chain (BSC).
Meta Horizon Worlds and Horizon Workrooms: Meta bills its fledgling metaverse Horizon platform as an “ever-expanding social universe” to hang with friends and create your own worlds. Workrooms is the company’s mixed reality app for employee collaboration.
Nvidia Omniverse: The chipmaker’s virtual platform focuses on 3D design work on computer graphics, simulations and the creation of new worlds.
Rooom: Rooom specializes in enterprise virtual showrooms, 3D product presentations and virtual events that can be used by marketing and sales groups in verticals such as education, retail, life sciences and manufacturing.
Second Life: Second Life’s Metaverse City bills itself as “a welcoming role-play community” with immersive experiences that let players come in and out as they like.
Somnium Space: Open source platform allows users to purchase digital land parcels and build homes and buildings, as well as start businesses, among other activities.
Sorare is one of the first NFT-based fantasy football games. Players can trade and play cards as an immersive gaming experience. Sorare allows players to build lineups from the cards in their collection.
Illuvium is a blockchain play-to-earn game that uses Unreal Engine 4 technology to produce 3D virtual objects. This platform offers an immersive gaming experience in a virtual world that hosts avatars, usually called Illuvials. These Illuvials exist as NFTs, which hold value on the Ethereum blockchain.
Bloktopia combines blockchain technology, virtual reality, and augmented reality to offer developers, gamers, and investors a futuristic, one-stop web3 destination. Bloktopia describes itself as a 12-floor virtual skyscraper that represents 21 million bitcoins. Users benefit from access to crypto information and immersive content in a single place. Bloktopians — users who hold the BLOK token — can earn revenue through various avenues, including real estate ownership and advertising.

Metaverse companies

Currently, over 160+ companies are working to harness the full potential of the metaverse, building a version or feature of the metaverse.

A metaverse company is a business that focuses on creating and managing virtual worlds, usually for entertainment or education. These companies often develop the necessary software and hardware to make their virtual world accessible to users. In many cases, they also create and maintain the content within these digital environments. While Meta focuses on creating virtual reality environments, companies like Microsoft and Nvidia are developing metaverse environments for collaborating and working on digital projects.

Microsoft: Mesh is Microsoft’s gateway into the metaverse. It’s a virtual collaboration space for Teams, which will allow employees to use online avatars to interact and engage with each other during meetings.
Apple: Apple has been known to establish itself as a pioneer and adopter of emerging tech. Carrying on the tradition, reports suggest that Apple is developing AR/VR headsets that will allow them to enter the metaverse.
Meta: Meta (formerly known as Facebook) is working towards developing digital solutions for everything between work and play.
Nvidia: Nvidia’s Omniverse Enterprise is laying the foundational groundwork for crucial metaverse features and concepts, albeit without building a metaverse itself.
Epic Games: The hugely popular video game Fortnite built by Epic Games is known to contain one of the best “starter packs” for creating a tall and wide metaverse of its own.
Roblox: Roblox is perhaps one of the best-placed metaverse companies as it contains a store of user-generated games in a virtual world where people can build, create, and interact.
Decentraland: The metaverse has been at the core of Decentraland since its inception in 2017. Recently, a plot of real estate was sold for $2.4 million in Decentraland.
Unity: Unity is a very prominent name in the gaming industry, where it has helped bridge technology gaps across various games for developers alike. Unity has now enabled developers to create immersive, interactive experiences to connect with users in the metaverse for any industry.
Minecraft: Microsoft’s Minecraft is another custom virtual world-building game that’s positioned to be a strong front runner for either building or contributing essential concepts of the metaverse.
Niantic: Pokemon Go was a revolutionary AR game that was launched in 2016 by Niantic. It has displayed the ability to bridge the gap between the virtual and real world, a concept pivotal to the success of the metaverse.

Part IV: Criticism & challenges

The metaverse has become a subject of excitement and controversy over the past years. While companies like Meta and Microsoft predict that the metaverse will someday replace the internet, critics argue it’s a marketing gimmick that won’t ever see the light of day.

Feasibility

Supporters of the metaverse are optimistic that it will be an open and universal standard, but given the tech industry’s current obsession with walled gardens, it seems unlikely. The more likely reality is that you will be able to visit different metaverse worlds as and when needed — not too dissimilar from modern video games and the internet in general. Even so, many simply cannot see the appeal of living in the metaverse full-time, or even for long periods.

In December 2021, Raja Koduri, senior vice president of Intel, claimed that “Truly persistent and immersive computing, at scale and accessible by billions of humans in real time, will require even more: a 1,000-times increase in computational efficiency from today’s state of the art.”

In a February 2022 article for The New York Times, Lauren Jackson argued that the metaverse is “stalled from achieving scale by a lack of infrastructure for both hardware and software, a monopolistic approach to platform development, and a lack of clear governance standards.”

Social issues

Metaverse development may magnify the social impacts of online echo chambers and digitally alienating spaces or abuse common social media engagement strategies to manipulate users with biased content.

Keza MacDonald of The Guardian criticized the utopianism of technology companies who claim that a metaverse could be a reprieve from worker exploitation, prejudice, and discrimination. MacDonald stated that they would be more positive towards metaverse development if it was not dominated by “companies and disaster capitalists trying to figure out a way to make more money as the real world’s resources are dwindling.”

Marketing professor Andreas Kaplan, citing their experience studying Second Life users, argues that the metaverse may have a generally negative societal impact due to its strongly addictive potential.

User safety

User addiction and problematic social media use are other concerns. Internet addiction disorder, social media, and video game addiction can have mental and physical repercussions over a prolonged period, such as depression, anxiety, and various other harms related to having a sedentary lifestyle such as an increased risk for obesity and cardiovascular disease. Experts are also concerned that the metaverse could be used as an ‘escape’ from reality in a similar fashion to existing internet technologies.

Virtual crimes like sexual abuse, child grooming, and harassment are significant challenges within existing virtual reality social platforms, and may be similarly prevalent in the metaverse. In February 2022, investigations by BBC News and The Washington Post found minors engaging in adult activities in applications such as VRChat and Horizon Worlds despite an age requirement of 13 years or older. In an October 2022 interview, Roblox Chief Scientist Morgan McGuire stated that it is “a challenge to moderate 3D”, and also compared moderating Roblox to shutting down speakeasies.

Privacy

Information privacy is an area of concern for the metaverse because related companies will likely collect users’ personal information through interactions and biometric data from wearable virtual and augmented reality devices, says an article in MIT Technology Review.

In 2021, David Reid of Liverpool Hope University argued the amount of data collection in the metaverse would be greater than that on the internet stating “If you think about the amount of data a company could collect on the World Wide Web right now, compared to what it could collect with the metaverse, there is just no comparison.”

Security & Privacy Threats in the Metaverse. (Source: Yogesh K. Dwivedi, Laurie Hughes et al)

How law enforcement agencies are using the metaverse to fight crime

Law enforcement agencies worldwide are now launching innovative metaverse initiatives that will help protect communities and guarantee the rule of law. Criminals are starting to exploit metaverse, and there is a growing threat of potential crimes as virtual and augmented reality continues to develop. The list of possible crimes includes data theft, counterfeiting, ransomware, phishing, money laundering, and sexual harassment and assault.

Europol recently released a report called Policing in the Metaverse: What Law Enforcement Needs to Know, which outlines how the technology could fuel future crimes, including the potential for criminals to replicate or hijack user avatars in the metaverse. The report aims to educate law enforcement agencies and policymakers about the new environment of the metaverse so they can adapt their policing tactics.
Interpol unveils the world’s first law enforcement metaverse experience: INTERPOL, the international crime-fighting organization, unveiled the first-ever metaverse experience designed specifically for law enforcement. Using virtual reality headsets, the INTERPOL metaverse enables users to: Tour a virtual version of the INTERPOL General Secretariat headquarters in Lyon, France; Experience hands-on training activities and interact with other users; Go through a training course on travel document verification and passenger screening; Teleport to an airport where they can apply their new skills at a virtual border checkpoint.

Part V: Trends & prospects

McKinsey & Co.’s research shows the metaverse concept is predicted to add $5 trillion to the value of the global economy by 2030. That illustrates the impact the metaverse is expected to have across key sectors and businesses over the years.

Other efforts to quantify individual metaverse technologies, like virtual reality, augmented reality, 3D games and digital twins, suggest metaverse tools will generate far less in annual revenues. MarketsandMarkets, for example, predicted that the market for 3D metaverse technology for entertainment, media, art, fashion and retail will reach $426.9 billion by 2027, while Gartner placed the enterprise digital twins marketplace at $183 billion by 2031. Meanwhile, other estimations have pegged the metaverse at roughly $1.5 trillion by 2030 when blockchain and decentralized finance technologies are included. Lower predictions tend to focus only on software applications.

As the metaverse grows in popularity, virtual assets will gain in economic value and a growing number will be created by individual users and exchanged between users and companies. These assets will be owned either in Web3 decentralized infrastructures or in “walled gardens.” Because of the underlying volatility of these assets, BCG project that their transaction value will range between $150 billion and $300 billion by 2025.

Metaverse market structure and forecast. (Source: BCG analysis)

Metaverse trends

Web3 and decentralization

According to the proponents of web3, distributed ledgers and blockchain technology will give rise to a new internet outside of the control of global corporations. This vision is built around decentralized metaverse platforms such as The Sandbox and Decentraland, which is eventually organized as DAOs. Buying ownership rights will give individuals a say in the way that the organization building the virtual domain is run, which will eventually lead to the establishment of virtual democracies and user-owned communities.

NFTs are another aspect of the decentralized metaverse. Brands, including Nike, Adidas have used this technology to create digital goods that can be worn, traded, and displayed by their owners in the metaverse. Another footwear brand, Clarks, recently unveiled an online tournament using the Roblox platform where users can win unique virtual goods.

The vision of the metaverse as a decentralized, community-owned utopia is somewhat at odds with the vision promoted by companies like Meta and Microsoft, which are aiming to build proprietary digital universes where they will have absolute control. 2023 is likely to bring further interesting developments in this clash of digital cultures.

Metaverse as a new marketing channel

As with search engines and social media, marketing and advertising will provide the fuel that will boost web 3.0 — the metaverse — into the mainstream. The concept may not have completely coalesced yet, but businesses from giants of international finance like HSBC and JP Morgan to global lifestyle and fashion powers like Nike and Gucci have already staked their claim and begun building their metaverse presence. The metaverse, with its focus on customer experience and one-to-one connections, is another channel of communication.

Corporate metaverse

The metaverse promises to provide platforms, tools, and entire virtual worlds where business can be done remotely, efficiently, and intelligently. The metaverse concept merges with the idea of the “digital twin” — virtual simulations of real-world products, processes, or operations that can be used to test and prototype new ideas in the safe environment of the digital domain.

Another use of metaverse technology in the corporate world will be conducting training, onboarding, and other tasks. For example, consulting giant Accenture created a metaverse environment called The Nth Floor that features replicas of real-world offices and lets employees and new hires conduct a number of HR-related functions within the virtual world.

Metaverse collaborative working environments such as BMW’s augmented reality labs that are used to design and prototype new products will also become more popular as teams investigate new methods of working remotely while remaining engaged with colleagues and their creative process.

Virtual and augmented reality

The idea of immersive, experiential technology is central to the metaverse. Therefore, many ideas of how we will interact with it involve immersive technology such as virtual reality (VR), augmented reality (AR), and mixed/extender reality (MR/XR). Meta has built its specific vision of what the “next level” of the internet will look like around virtual reality, and 2023 will bring new versions of its hugely popular Quest VR headsets, as well as new VR/AR/MR headsets from companies such as Apple, Google, and Microsoft. Not everyone agrees that entering the metaverse will require us to fix displays to our heads, but it’s certainly one of the approaches to building immersive experiences which are generating the most excitement, and 2023 will bring a host of new developments in the field. Beyond headsets, we can expect to see new developments in full-body haptic suits, which are already used by organizations like NASA and SpaceX for simulating extreme environments but will also be used to create consumer metaverse experiences that are even more realistic and immersive. Several startups are even experimenting with technology that’s able to introduce smells to virtual experiences.

More advanced avatar technology

Many ideas of what the metaverse will involve us adopting avatars. Meta originally offered only very basic cartoon-like avatars — which were widely ridiculed — but more recently has developed almost photorealistic technology that will allow us to look almost exactly like we do in the real world. Other technologies, such as Ready Player Me and Zepeto, let us create avatars that can then be dropped into a number of different virtual worlds and environments rather than restricted to a particular platform. More advanced use cases for technology such as motion capture will be developed, which will mean that as well as looking and sounding more like us, our avatars will adopt our unique gestures and body language.

Metaverse predictions for 2030

Multiple metaverses: The grand vision of the metaverse is built on a single integrated ecosystem, much like the internet. In the near term, there are likely to be independent metaverse platforms with separate economies and the ability to move assets and objects between worlds. Most companies will have a presence in multiple metaverses, predicted Eran Elhanani, co-founder of gaming and metaverse ecosystem GamesPad, who expects most businesses to build out a presence, whether selling retail e-commerce or enterprise products.
The metaverse will transform all business processes: The first waves of digital transformation focused on how technology could improve electronic processes. Metaverse technologies will help businesses capture virtual representations of physical channels, products and operations to improve physical processes. Companies will build their own metaverse before making a move in the real world, he conjectured, noting that Accenture recently built a digital twin of a planned office to collaborate on different workspace layouts, technologies, and processes, which dramatically reduced rework and errors.
New security and privacy issues will emerge: Existing concerns about security and privacy will be amplified. 3D capture techniques will collect an increasingly larger swath of personal and biometric information that hackers could compromise. Deepfake attacks will utilize this expanded data to craft increasingly sophisticated attacks mimicking bosses, customers, regulators or institutions. Brands must also watch out for new digital counterfeits or 3D-printed knockoffs. Companies should take a proactive approach starting at the services level so security is maintained, no matter where corporate assets go. Businesses also need to proactively communicate what consumers and other stakeholders can expect from metaverse initiatives, plus how companies plan to mitigate potential risks.
The metaverse will expand beyond virtual showrooms: The business side of the metaverse will use improvements in 3D modeling software, lidar capabilities, and scalable multiuser environments to develop new approaches to solving problems. Enterprises will need to be experimental because there’s currently no playbook to follow, which will also leave the door open to discovering and exploiting new and valuable niche applications.
Digital twins will mirror the entire enterprise: Companies currently use process mining and capture technologies to model business processes. Meanwhile, improvements in 3D capture techniques, such as lidar, are modeling physical assets.. Digital twins are already emerging across industries to increase efficiency and better plan and prepare for the expected and unexpected, such as stress-testing manufacturing operations or supply chains.
Customer service and sales roles will transform and automate: The metaverse will be used to create a vastly improved customer support experience by enabling digital twin support agents to virtually sit alongside the consumer and help them troubleshoot a problem. A customer running into difficulty installing a new faucet, for example, could call upon a customer service agent for help with the installation. In other scenarios, salespeople could join clients in the metaverse to demonstrate a product, or sales and support agents could pull in a lead engineer to solve a technical issue.
Digital-first will evolve into meta-first: Mobile and social channels have helped enterprises test new products, services, and business models digitally and scale the more successful ones in physical channels. More products will be launched into virtual worlds — sometimes before a physical version goes into production. Companies will be able to better understand what customers want, co-create new offerings with them and share insight with their product development and merchandising teams.
Enterprises will bake reality into the metaverse: The metaverse presents an opportunity to combine geometry, materials intelligence and the laws of physics. Engineers have been bringing physics to the digital world for decades to perform complex analysis. The next step is simulating assets in the metaverse accurately and in real time. Combining more efficient modeling techniques that use AI and newer algorithms with more powerful computers will enable companies to analyze larger systems. In addition, companies will be able to combine data analytics digital twins with physics-based digital twins to create accurate, realistic models of ever-larger assets and collections of assets in real-time.
The metaverse will consolidate technologies: Vendors offered managed services and VMs for years before the cloud consolidated disparate approaches into new enterprise architectures. Enterprises will be bombarded with options to explore metaverse studios, devise strategies, and experiment in the same way the cloud influences activities today. Vendors will start rebranding existing products and services to be at the core of enterprise metaverse strategies, including commerce, blockchain, distributed infrastructure, digital twins, and customer experience.
Gamification will galvanize calm technologies: Innovations around blockchain and non-fungible tokens helped create a cottage industry of play-to-earn (P2E) games, like Axie Infinity and Gods Unchained, in which players perform mundane tasks to earn cryptocurrency. Some metaverse proponents argue that consumer brands may adopt a more sophisticated version of strategies to earn points, discounts, miles, or other perks. New P2E models are gaining momentum. In the U.K., for example, P2E game adoption may nearly double in 2022. But, even at this early stage, the trend is seeing pushback from gaming journalists concerned that P2E detracts from the metaverse experience. A survey of 160 game journalists by public relations agency Big Games Machine on the state of game journalism in 2022 found that three-fourths of respondents were unlikely to cover blockchain games in the next six to 12 months.
Robotics innovations will accelerate: The metaverse is for more than just people. High-fidelity models of real-world environments, like factories, warehouses, construction sites, and mines, will enable engineers to tackle challenges that are otherwise too expensive, time-consuming or impractical. These environments can generate better synthetic data of edge cases that are hard to find in the real world and help test, validate and optimize autonomous systems virtually. They can also help determine how robots with different configurations and functions might work in the same space or even collaborate.