"The metaverse is essentially a massive, interconnected network of virtual spaces."
Rabindra Ratan, Michigan State University
The term "metaverse" officially entered mainstream vernacular in October 2021 when tech titan Facebook rebranded itself Meta Platforms, Inc. - now widely referred to simply as "Meta". With this big move, they signaled their desire to transcend their social media roots and move to "the next chapter of the Internet."
Facebook CEO Mark Zuckerberg himself referred to the metaverse as "an embodied internet that you're inside of instead of just looking at." Technology research and consulting firm Gartner goes deeper, defining metaverse as "a persistent and immersive digital environment of independent, yet interconnected networks that will use yet-to-be-determined protocols for communications."
The metaverse is about putting users in the middle of the action, opening the door wide to more realistic experiences than simply browsing the web or enjoying a video can offer. It is meant to replicate, and enhance, real-life functionality in a virtual space.
Perhaps it's best to describe the metaverse in terms of its most defining features, its major underlying technologies, and the aims of its most important creators.
Metaverse distinctive features
What mainly makes the metaverse distinctive are a few key features, including the fact that:
The metaverse is immersive - rather than simply watching a video, participants are actually in the video, able to move around, shifting views and perspectives; they're able to use their hands to interact with virtual things and their voices to give commands or communicate with others.
The metaverse has "physical" locations - instead of working through two-dimensional websites or app interfaces, participants "teleport" to "physical" locations in the metaverse, e.g., game spaces, marketplaces, meeting rooms, socializing areas, etc.
The metaverse links multiple "metaverses" - the goal is to link the multitude of smaller virtual universes together so participants can seamlessly shift their avatars, digital assets, etc. from one virtual space to another.
Other aspects of the broader metaverse carry over directly from the narrower ones. Just as in interactive video games, in the metaverse participants exist as avatars and can own unique possessions.
Augmented and Virtual Reality
"AR wearables may be as pervasive as smartphones are today." Patrick Cozzi, Cesium
Augmented reality and virtual reality are concepts and technologies that undergird the metaverse. They are different iterations of similar technologies, actually separate entities that complement and supplement each other.
AR and VR both allow users to immerse themselves in a virtual world, but AR only adds visual elements to existing surroundings, allowing for interaction with them. VR generates completely different virtual surroundings. Through AR glasses, users see "holograms" of the metaverse against the backdrop of the real world. Think of Pokemon Go as an early, rudimentary example of AR in action.
"I did a VR experience called The Climb during the lockdown, and it gave me a sense of body confidence. Then I did a real hike in Madeira, and I found I was much more adventurous. This sort of thing can be quite deep on an almost spiritual level." Catherine Allen, Limina Immersive
Fully-realized VR, meanwhile, including headsets, haptic gloves, and smart clothing, offers the potential of true-to-life sights, sounds, and smells. While sitting at home, a user can "visit" Ancient Greece or Rome and enjoy the full experience of actually being there.
Metaverse creators
Builders of the metaverse aim to transform the way we interact with each other on the internet, promising to make our experience more immersive, interactive, and collaborative. We'll be interacting in ways we only imagined through science fiction.
"When you're in the metaverse, when you're in a virtual reality headset, you will feel like you're actually sitting in a room with someone else who can see you, who can see all of your nonverbal gestures, who you can respond to and mimic."
Rabindra Ratan, Michigan State University
Massively popular online games like Fortnite, Minecraft, and World of Warcraft all function as metaverses, creating a virtual world. But the metaverse is more than an extended interactive video game.
Major player aims
The tech industry is buying into the metaverse concept in a huge way, and it's their intentions - together with their related investments - that will most directly determine what shape it actually takes in the future. Consider:
Facebook (Meta) clearly plans to rely on AR and VR to bring greater realism to the metaverse experience, as signaled by their acquisition of Oculus for $2.3 billion in 2014. Starting in 2022, the entire Oculus Quest product line, including the world-class VR headsets, will be rebranded to Meta Quest. More tantalizingly, Meta is creating a way to interact with virtual items in the metaverse simply by thinking it, with technology called electromyography (EMG).
Microsoft's Mesh plans to allow Teams users to participate in video meetings via animated avatars rather than webcam images. Artificial intelligence listens to user voices, driving the animation of avatars accordingly (with matching lip and hand movements).
Nvidia's Omniverse is envisioned as "a platform for connecting 3D worlds into a shared virtual universe". Based in the cloud, it consists of a shared, persistent platform that remains static between sessions. It runs on Ray Tracing Texel eXtreme (RTX)-based systems and can be streamed remotely to any device.
Like Nvidia's Omniverse Enterprise, Meta's Horizon Workrooms and Microsoft's Mesh are designed to empower work in a virtual world, enabling remote collaboration across devices through mixed reality applications. With this technology, virtual meetings shift to the metaverse and workers increasingly rely on employing VR headsets and avatars at work.
Taking a more limited approach, Tokens.com shelled out $2.4 million for a 116-parcel estate in the heart of Decentraland's Fashion Street district, where they plan to develop a virtual Fifth Avenue-like experience. "Rather than try to create a universe like Facebook," Andrew Kiguel determined, "Why don't we go in and buy the parcels of land in these metaverses, and then we can become the landlords?"
Metaverse potential
Revenues in the metaverse are projected to reach $800 billion by 2024, with one billion users expected by 2030. Global spending on the critical supporting technologies, AR and VR, is estimated to reach $72.8 billion in 2024 - six times greater than the $12 billion expended in 2020.
In a believe-it-or-not moment Matthew Ball, CEO of venture capital firm Epyllion, recently stated he sees the metaverse becoming a $10-$30 trillion opportunity. Even keeping in mind that Ball recently established a metaverse exchange-traded fund, thereby entering his horse in this race, few will deny that the metaverse potential is indeed massive.
Disclaimer: E1 Asset Management does not do business with cryptocurrencies. This article is intended for educational purposes.