The metaverse seems to be the latest buzz word, and though it might sound like a brand new concept, the word and the foundational technology behind it have been around for a while. Beginning as a virtual reality platform that hosts massive multiplayer online games, the technology became a popular tool during the pandemic when companies, institutions and individuals had to find a way to move in-person work and education to an online space.
The word metaverse came back into widespread use in late 2021 when Mark Zuckerburg of Facebook (now Meta) outlined his vision for what he calls “an embodied internet where you’re in the experience, not just looking at it.” The metaverse promises to create new opportunities and potentially rapid growth in virtual retail, real estate and other financial markets as well as expanding entertainment, education and work environments.
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What is the Metaverse?
First coined in 1992 by Neal Stephenson in his dystopian cyberpunk novel Snow Crash, the metaverse, and public understanding of its capabilities, seemed to be straight out of science fiction. Although a version of the metaverse already exists in multiplayer online games like World of Warcraft or Second Life, it is anticipated to evolve into a digital retail and entertainment space that offers real-world experiences in a virtual environment. Users will need to use virtual reality headsets and technology to participate, and much like in the online games, avatars will represent participants within the virtual space, with chances to upgrade your avatar for a price.
According to Mark Zuckerberg, the metaverse is poised to be the next great technological leap forward, and many companies are starting to claim their space in the virtual landscape. For example, Microsoft has plans to combine their mixed reality platform Mesh with their business communication platform Teams, labeling the combination of the two as “a gateway to the metaverse.”
Pros and Cons of the Metaverse
As with any new investment, though there is potential for incredible benefits, it’s also essential to pay attention to some of the problems that could arise. There may be many new financial opportunities coming, but it’s still a little soon to know how the metaverse will influence our day-to-day financial lives.
Enhanced educational experiences: There promises to be a variety of educational advancement in the metaverse, including greater integration of and access to STEM in engaging formats and a more refined version of online classes and remote collaboration. Giving a student the ability to experience history or science as a participant, rather than as a passive viewer, means that the metaverse is likely to improve remote learning exponentially and open a doorway to educational breakthroughs.
Creation of a new virtual economy: There seems to be massive interest in the worlds that the metaverse can create. Not only is there potential for a more equitable financial space built essentially from the ground up, but the integration of blockchain, cryptocurrency and new digital currencies into this virtual economy could have a real-world impact on financial institutions.
Significant growth and investment opportunities: Many companies are betting that virtual shopping experiences for real products as well as purchases of virtual items within the metaverse worlds will make a lot of money. Shoe company Nike, for example, is developing an NFT version of shoes for sale in virtual reality, and entertainment companies like Disney are exploring ways to create exclusive content within the metaverse.
Additionally, companies that make high-powered servers or components needed in computing hardware are likely to be in high demand. The speed and quality of internet services will also need to improve, so the companies that can develop that service are also likely to see an increase in revenue.
Advanced technology and internet speed requirements: Although remote working may be here to stay in some industries, remote education has had limited success, due in large part to a lack of hardware or access to the internet in rural or underfunded communities. There is the potential for an even wider gap in education to develop as more affluent communities have access to the metaverse while other communities may be excluded.
Privacy concerns: Online privacy and identity theft are essential considerations in our everyday lives. According to Pew Research, 81% of the public say that the potential risks from companies’ data collection outweigh the benefits. It’s clear the digital space isn’t going anywhere, but the metaverse could lead to more problems for individuals and institutions as even more of our daily lives become digitized.
The blending of real and virtual worlds: Humans are social creatures and need real interaction. While virtual reality may feel like a real connection, isolation and loneliness are likely to increase among those spending a majority of their time in the metaverse. Likewise, addictions to a virtual world may lead people down a dangerous path that society isn’t equipped for. The general public will have to deal with real-life consequences as the metaverse evolves.
The potential growth and advancement in the metaverse seem like a gamble that many companies and individuals are willing to take. As the metaverse evolves, there may be many possibilities for developments in technology, entertainment and retail. While there is usually some benefit to getting in on the ground floor, the negative aspects also need to be considered.
As with with any new investment, do your research and stay alert for potential issues or problems. The metaverse is poised to turn into the next big thing, but it’s vital to understand the hazards of unexplored territory.
Disclaimer: eXp World Holdings, the holding company for SUCCESS, is also the holding company for Virbela, a virtual reality solution for organizations.