Beyond the Hype: Metaverse as a business platform

The Metaverse is the latest buzz in the tech industry, sparking a familiar cycle of grandiose future announcements and frenetic investment. The Metaverse is taking over the world. Some say it's the future of the internet, others say it's the next big technology platform. While Metaverse definitions still vary somewhat, all experts agree that we are getting closer to the computing world than ever before.

Augmented Virtual Reality and Spatial Audio

Augmented reality is one of the main technologies for creating Metaverse. Augmented reality tools will help us interact with digital communities like never before. In the future, we will interact with companies in the virtual space and use holograms to design new products.

In a space where digital and real content constantly intersect, a deeper use of XR will be required. This will require developing more immersive experiences through high-quality images and incredible spatial sound.

In order to enter the digital environment as naturally as entering a room in the office, we will need the tools that we use to interact on the Internet. For example, lightweight smart glasses will replace bulky headsets, and hands-free devices will become a natural alternative smartphone as hardware evolves.

The Metaverse promises us a stunningly realistic 3D digital world where we can (for example) buy and sell goods and services, sign and enforce contracts, hire and train up-and-coming talent, and interact with customers and communities.

In the metaverse, you can, for example, put on a virtual reality headset and visit a factory located on the other side of the world. You will see and touch the equipment, shake hands with the local manager, inspect the operation of the plant without leaving your workplace. You can even send one digital version of yourself to the factory while the other one meets with the board of directors. Customers will be able to move from one virtual showroom to another, feeling the wind ruffle their hair during a test drive. And after you leave this digital reproduction of the factory, it will continue to produce in parallel with your physical factory. The virtual car will wait for the next virtual driver. Today, many young people are already trying on virtual clothes in virtual retailers or purchasing virtual goods for their virtual gaming environment.

What is the metaverse and what is its significance for business

The Metaverse is trending as it is considered evolution and not revolution and business leaders should not ignore it. Among all the discussions today about the Blockchain, metaverse and crypto projects, the definition of Metaverse takes the first place. Metaverse - The convergence of the physical world with virtual and augmented reality has accelerated the pace, causing disruptions in various sectors of the economy around the world.

The biggest tech companies are pouring a lot of money into this next iteration of the internet, and the building blocks of the metaverse are on the market. Many companies today are vying to reserve their seats in the metaverse, with big names such as Microsoft, Facebook, NVidia leading the way and Adobe has even updated its Photoshop app to support the creation of Metaverse-ready NFTs. The Metaverse will be basically a virtual ecosystem, which in turn will be a collection of different virtual worlds. You can access different services and applications in the metaverse as separate spaces for different use cases and applications.

What is the hype

At the end of November, Republic Realm, a company that specializes in building objects in the metaverse, acquired a plot in the Sandbox game metaverse for $4.3 million. So far, this is the largest such transaction, although a new record is probably not far off: a few days earlier, a site in the virtual world of Decentraland was sold to Metaverse Group for $2.43 million, breaking the previous record by 2 times. By comparison, the average Manhattan real estate deal is $2.4 million.

Investors who buy virtual land expect that as more users shop, socialize, go to the office, and attend metaverse events, the price of those properties will rise.

Thinking more analog investors after the presentation of Zuckerberg began to buy shares of companies that can earn on the development of the metaverse, writes Barron's. For example, Matterport, which makes cameras and software for 3D imaging and virtual tours, is up 74% in a month since October 28. Assets of the Roundhill Ball Metaverse ETF more than quintupled in November to $866 million. The exchange-traded fund industry is looking to launch new funds targeting the metaverse as soon as possible, Bloomberg noted.

What can the metaverse grow into?

Tech enthusiasts, including Zuckerberg, believe that the metaverse will be a major part of the transition from Web 2.0 (mobile internet, cloud computing, large platforms, etc.) to Web 3.0 (decentralized internet, more local and niche platforms, etc.) in next 5-10 years. Analysts at Goldman Sachs agree with this.

Metaverses can bring companies $1 trillion in annual revenue through advertising, events, online commerce within virtual worlds, and devices, estimates Grayscale, a billion-dollar digital asset manager, including the world's largest crypto fund. In developed countries, people are already spending more time online than in physical spaces, analysts at Morgan Stanley said. Their colleagues at Jeffries believe that the digitalization trend accelerated as a result of the pandemic will continue further.

Forecasts

According to Grayscale Research, Metaverse could be worth $1 trillion a year. The business share related to the Metaverse was already worth 50 billion dollars in 2020, but it is set to grow to 800 billion in 2024 (source: Grayscale) and 1 trillion in 2025.

The latest study from Digital Horizon names the expansion of the metaverse market as one of the main trends of 2022. The researchers expect that investments in meta platforms over the next three years (as a percentage of market capitalization) will be the largest, and the share of the digital economy in total GDP for the year will grow to 16.8%, which will be $15 trillion.

These are important numbers, which testify the growth of a phenomenon that can no longer be categorized as hype.

The evolution of the metaverse depends on three things, Bernstein analysts write:

1. Will it be a closed or open platform - in other words, will it be one metaverse or several at once. Some concepts of the metaverses assume full compatibility, but this requires a common operating system, which seems unrealistic so far. Digital goods will cost less if they can only be used on one platform.

Creating a shared metaverse is a “remote and huge task,” Morgan Stanley analysts agree. For example, game worlds are now not connected in any way. Jefferies believe that in less than 10 years there will be no single metaverse.

2. Creation of demanded user scenarios. A leading indicator of this could be the introduction of business-friendly features: for example, personal computers and mobile phones were first used by businesses before they became consumer goods.

3. Will the metauniverse exist without VR (apparently, there are more scenarios for AR).

The metaverse will only become real when Apple and its users join the trend, according to Morgan Stanley technology analysts who spoke with representatives of the VR / AR industry. Unlike Microsoft and Meta, Apple has not yet ventured into the production of AR / VR devices.

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