The ultimate metaverse metastudy. What are the smartest people in the world thinking?
A look into the different concepts, criticism, hope, and despair. Will today’s dreams turn into reality? And are we talking sweet dreams or rather a huge nightmare?
First, a bit of self-promo. On February 17, a conference on business opportunities in the metaverse will take place in Prague as part of the Creative Talks. Five guests from different fields (from AI to mathematics and economics) will try to get to the bottom of the matter. How much of the metaverse is mere hype? And how to prepare for the future? The event is exclusively “physical”, but you can watch the recording later (keep an eye on our YT channel).
Disclaimer: This article is an initial metastudy which includes links to various sources as well as some of the author’s views. It does not express the views of any Creative Talks participant. If you already know a thing or two about the topic, feel free to skip the first two blocks.
What is the metaverse?
No, it’s not the thing that Meta/Facebook announced last year. All they did was publicize it. The word “metaverse” comes from Snow Crash, the excellent novel by author and MIT alumn Neal Stephenson. But there’s no clear definition of it yet. Perhaps because so far, it’s merely a mixture of visions, dreams, and futuristic manipulations by the Big Tech companies who see it as the next iteration of the world wide web. We don’t even know for certain that such a thing will come into existence. The basic idea, for now, is that of a social network, just in a better, 3D design. Something like the — now rather passé — concept of virtual reality, but one where participants will be connected by next-generation social networks. Either through VR sets or just your classic 2D screens, since it doesn’t need to be an outright 3D environment. Actually, it doesn’t even need to be a network. Tu put it simply, there’s a lot of confusion around it. Adi Robertson discusses this terminological awkwardness in her brilliant article for The Verge.
Some of the most typical cultural models for the metaverse include the movie Ready Player One, based on the book by Ernest Cline, the Matrix series, and the aforementioned Snow Crash. By the way, these are all out-there dystopias in which you really wouldn’t want to live. But the concept of the metaverse is especially close to the games industry. Second Life, Fortnite, Roblox, and others are all existing (albeit outdated) varieties today. It’s even possible that the forthcoming metaverse will essentially be just a gaming environment.
But the blurring of identity is what is supposed to be the major change, erasing the clear, discernible boundaries between who’s who a what’s what. The avatars of us humans will be able to communicate with each other, with digital objects, but also with artificial beings. Only unlike humans, AI will have the ability to create an essentially infinite number of these identities. So each of us might really get their own Matrix, a tailored digital world. And we might not even be aware of that. Whether it’s going to be heaven or hell is a matter of perspective.
What’s the difference between the metaverse and Web 3.0?
Yes, there’s also the issue of ownership, blockchain, and NFTs. Most people do conflate the terms “Web 3.0” (Web3, W3) and “metaverse”. Web 1.0 is what we call the beginnings of the web sometime around 1990 to 2005, when a couple of people were creating content for the vast majority. Web 2.0 is the web we know today, running on user-generated content — typically social networking. But only a few entities own the data. Ownership of the third-generation web, Web 3.0, is expected to be decentralized using blockchain, similar to the bitcoin decentralization.
Journalist Kristin Houser explains the differences between W3 and the metaverse in depth — but comprehensibly — in an article for Freethink. Both approaches are being described as the “internet of the future”, but each works differently. Whereas Web 3.0 is mostly about who will own and rule the internet of tomorrow, the metaverse concept focuses on how users will experience it. So if the metaverse world does come to fruition, it might be centralized (like Web 2.0), decentralized (like Web 3.0), or a combination of both. Whatever the case, it will likely be a world powered by NFTs (i.e. unique tokens), Andrew Hayward writes for Decrypt.
The metaverse will be great for manufacturing
First, on a positive note. The metaverse technology is definitely a great opportunity for the manufacturing industry. Venture Beat describes various forms of simulations which are already in use for aircraft construction or the Digital Twins technology (which simulates and analyses production and business processes). That’s why Nvidia is opening up a whole new platform, the Omniverse, which could become the new industry standard. You can also read more on this metaverse for engineers here. Similarly, Microsoft wants to target office apps. And Business Insider hopes this will create new job opportunities.
The metaverse is also going to change industries as unexpected as the food industry. This has to do with the digitalization that is already underway. After all, the first bitcoin transaction was a pizza purchase; on May 22, 2010, Laszlo Hanyecz bought two pizzas for a now-unbeliavable 10,000 BTC. (This day is now celebrated as the Bitcoin Pizza Day.) Tech platforms are taking over customer relationships, but this can also raise the prices of certain foods by up to 90%. Future transformation will include booking, ordering, food presentation, and it might even enhance the experience of eating itself. To find out more about the possibilities of the food industry, read Bas Roose’s article.
Top metaverse platforms in 2022 a.k.a. the money-makers
The most is obviously expected from Meta, Google, and Apple. But that’s pure fantasy. Let’s put dreaming about the future aside for a moment. What is the situation like today? At the moment, Decentraland, Somnium Space, and Sandbox are the leading players when it comes to metaworlds that really work. So far, they all look similar. Decentraland is the oldest, but it doesn’t have a VR environment yet. All three are frenetically selling virtual land, which in turn is being frenetically bought by fans and companies. Users kind of aimlessly hang out in the metaverse; they might occasionally play a game or two or complete a quest to earn some local currency.
Another “league” consists of Animal Crossing, Discord, Fortnite, Topia, Roblox, et al. And let’s not forget the traditional corporates, who usually won’t build their own platforms, but rather bet on different horses. Nike, for instance, has built the Nikeland on the Roblox platform. H&M, Chipotle, Vans, or Huyndai are doing something similar. More info here (in Czech).
Here’s an overview of the most interesting currencies of various metaverse worlds. Hero (by Meta Hero), Blok (Bloktopia), Epik (Epik Prime), Atlas (Star Atlas), RFOX (Red Fox). Again: it’s mostly about money and a sort of “gold rush” for now. Noone knows what will come of it, but what if something did and they missed out on it? No global company can afford to take that chance today.
Speaking of business, here’s Jim Cramer’s well-done analysis for CNBC of which companies might profit from this technology and thus might be a good idea to invest in. Of course, those are graphics card and chip makers like SMIC, TSMC, UMC, Intel, or Samsung. And above all, Nvidia, which could soon become the number one player in the whole business. Especially if its grassroots ecosystem, Omniverse, beats Meta’s directive and controlling approach.
Naturally, China is also stepping in, at the same time warning that the market is overheated. But some Chinese cities have already founded metaverse associations to create their own copies. Baidu has launched a version for developers and wants to open its universe to the public in 5 years. Which actually sounds more realistic than the Meta craze.
By the way, according to Intel, 1,000x more computing power will be needed for a working metaverse and it will take decades before something like this can happen.
The Chinese are generally allergic to the term “metaverse”, which is why ByteDance (owner of TikTok) introduced the Paiduidao (Party Island) network, which does everything that generally counts as the metaverse, but according to a company spokesman “has nothing to do with the metaverse”. LOL. 🙂
The real-deal experiment
Ben Kliments conducted an interesting experiment for Wired: he spent hundreds of hours working in VR to find out what feels real, what will drive you mad, and what’s pure PR. The great thing, he concludes, is that you can set up your work station however you like and you’re not slouching in front of your computer. But it’s terrible for writing. Your battery lasts an hour, so you’re always needing the charger. Your forehead goes numb and your eyes go bad. You might enjoy the absolute quiet with no disturbances, but when you get off, expect to feel quite disoriented.
More on the work life: Allison Berke explains why work meetings in the metaverse are going to be hell. In short, virtual avatars feel unnatural and it will make interpersonal communication much more difficult. A very interesting read.
Author’s commentary: In my experience, it’s all about game philosophy. For me, as a non-gamer, this type of universe is completely incomprehensible. I hung around Nikeland, Decentraland, and some of the other worlds for a bit, but I absolutely did not enjoy it. I wasn’t even sure what to do. The graphics resemble games from 20 years ago and all the actions just lead up to a “buy this” moment. That’s where all the fun is. And there is already a generation of meta-consumers growing up. You can buy sneakers, jpg doodles, land, music, VIP passes to places, better tires for your car, patches for your game… Everything intangible and yet totally materialistic. The point remains: to buy more.
Adi Robertson and Jay Peters (The Verge) pose a question: Haven’t we already experienced the whole metaverse hype around Second Life in the 2000s? Is this somehow different? Or will the metaverse turn into just another advertising tool like social media did?
Update: There are other and highly critical voices. Phil Libin, founder of Evernote has tried out Horizon Workrooms (a product that Meta has now released in beta for the US market) and says that Facebook’s entire vision is uncreative and wrong from the start. He says it’s much more awful than he expected and using it is barely tolerable for a few minutes. He compares the hype around the Meta to communist propaganda in the former Soviet Union.
The dangers of elves and agents
Mind you, the most dangerous technology in the metaverse will be AI. At least according to Louis Rosenberg whose excellent article for Tech Crunch has stripped me of any notion that it could possibly play out any other way. 🙈In a nutshell, the idea is that the AI will create virtual characters in real time, which will be customized to our exact profiles so that we can relate to them as much as possible. And these characters will reach out to us and manipulate us, where in terms of politics or marketing. We won’t be able to recognize the truth from lies, the real thing from distortion, and even actual people from other entities. We’ll have no idea if a given “person” just wants to chat about beer or if it’s part of a mosaic made of thousands interlocking little elements that will eventually sway me in the elections. Today’s social networks, deep fakes, and hoaxes will look primitive in comparison.
Decentralization? More like chaos or dictatorship
In terms of benefits, the techno-optimistic vision (of corporates and geeks) clashes with the fear of possible enslavement. Twitter founder Jack Dorsey argues that a decentralized internet might not necessarily increase the power of its users as much as W3 advocates predict. All it will do is take the power away from the Big Tech and put in in the hands of the very same venture capitalists who are investing in blockchain apps now. People will never escape the corporations, Dorsey says: “It’s ultimately a centralized entity with a different label.”
After all, decentralized technologies are not either/or. In an exclusive interview, Polygon co-founder Sandeep Nailwal explains that decentralization can exist on different levels. BTW, Polygon aspires to become the backbone of a decentralized world, sort of like AWS for W3. Doesn’t that reek of centralization? 🤣
There are other controversies. Of course there’s also the threat of a Tower of Babel-type tragedy, as described in the novel Snow Crash. That is, every corporation and every individual having their own metaverse/state, incompatible with the others, and everything disintegrating into a chaos of corporate universes and an infinite number of blockchains.
Or, the opposite happens. The market consolidates into one strong player or just a couple of them. That would mean a worldwide dictatorship, unlike any the world has ever seen. Even states as we know them don’t have this kind of unlimited control over their citizens (customers). Imagine a platform where you live and work enclosed in VR with your information fully controlled by the provider, in a confidential, fluid legal system of “community rules”, but with no voting rights or courts of justice.
On the other hand, it’s great for business — but only if you’re a platform owner. That’s why at this point, all the big and small players are hectically trying to push their own solution. We may just be at a critical moment in history where the foundation is being laid for decades to come. And that’s why noone cares how much it costs to participate in the metaverse today. It’s a matter of tomorrow’s survival.
There are no global standards yet
The fact that we are living in a transitional period is also demonstrated by how immature the technology is. No global standards are in place yet. If you buy a virtual shirt or sneakers (i.e. skins) or, say, a plastic surgery in one universe, you won’t be able to bring it to another. You can’t even seamlessly travel between the worlds. You need to come back to reality first. Which, by the way, is a pretty unpleasant and even traumatic experience. It’s likely that treating these transitions between metaverse and reality will become the next big thing for psychologists. There is no “cyber police” yet either, so the first cases of harassment are already happening, with noone to deal with them.
But the main issue of apps built in W3 — and partly the metaverse — is the insanely complex UX/UI. Until it becomes as simple as the web we use today, it won’t stand a chance with the masses. For instance, a description of a “simple” way to create a smart contract, which is supposed to be the basic operation in the W3 universe, promises to “provide greater security and enforceability at a lower cost than traditional law”. But you can see right away that it’s nothing but a toy for developers and/or corporations.
It’s similar as with machine learning. Your regular freelancer is hardly able to build a whole neural network to improve their productivity. But a big company is. That’s how the companies will get rich. So a bit of business advice: if you believe in the metaverse’s success and you have someone to team up with or sell your brand to, get into it, stat.
The rise of corpocracy
It is rather obvious by now, so just a few quick observations. Why is Meta (Facebook) promoting the metaverse concept now, anyway? It’s their way of trying to become independent on Google and Apple. Their mobile users (which is the majority) arrive exclusively via Android or iOS. Which lowers both profits and control. If the metaverse project succeeds, Meta will be able to skip the middlemen and connect customers directly with their universe. I.e. total control, bigger profits. And that’s what it’s all about. The Verge has concluded something along these lines, while Business Insider informs that Meta is under investigation for monopoly practices. Again. Only this time, in VR. Meta also began building the world’s largest supercomputer, which will enable it to censor the content.
Apple is keeping quiet as usual, but according to recent leaks, it’s set to combine virtual and augmented reality. The iPhone already has some elements implemented, but a specific glasses/headset are predicted to launch in 2023. At least according to Bloomberg. You can find a cool roundup of the existing headsets on Tech Crunch. And Wired explains that if you do buy one, it will make streaming movies more fun.
Traditional, non-Big Tech companies are at least trying to hold onto some patents, although noone knows if that would do them any good in a “decentralized” environment. Walmart has seven patents and Nike is buying some, too. They’ve never been afraid to arm themselves with lawyers. Plus, they’re buying up companies like RTFKT and their virtual NFT factories are going strong. And Deloitte issued a press release at least. 🙂
Gulf News came up with an intriguing analysis of how only the biggest players stand a chance of winning. Participating in the metaverse is expensive for brands — for the increased cost, they are expecting higher profits. But once everyone is there, a certain level of numbness will be inevitable and each brand’s market position will be virtually the same as today. Nobody wins, except for platforms that manage to dramatically consolidate media wealth. The digital influencer market will be completely diluted, with nobody staying famous for more than a couple of days.
Update: A cooler word than corpocracy is platform economy. But the principle is the same, the biggest player takes all.
A paradise for kids… and the elderly
The metaverse won’t be just a trendy toy or playground for teenagers. That might be a transitional period. But when it stabilizes, it will become the perfect environment for small children as well as the elderly. The two segments it’s perfectly suited for. Both groups have limited options when it comes to mobility, albeit in different ways. So, for instance, the metaverse could become the ideal network for retired people to relive experiences their bodies no longer allow them to. But of course, anyone can fall for it. Especially if real life seems too “dangerous”, like in pandemic times. Life in the metaverse might eventually manifest similarly to heroin addiction. Rachitic, sedated people who show no will to live without their VR set. The new normal. Business Insider warns that the metaverse could become the essence of everything that’s wrong with the world. Entrepreneur, on the other hand, hopes it will provide a haven for creatives.
NFT: It’s not art
We’ve touched on this several times. The NFT is supposed to power the metaverse — or rather enable its main “legal” basis as well as its currencies/tokens. Let’s look into it.
Ginevra Davis’s sums it up perfectly in her report from NFT.NYC, a high-end New York conference where you can glimpse into the minds of people who buy the most expensive NFTs. A couple of excerpts: “The NFT boom is not about art or ownership. It is about escape.” “We will need clothes for the metaverse.” “NFTs are, fundamentally, an investment in the metaverse.” As for the buyers themselves, one of them observes, “It’s not art. Don’t call it art. That’s offensive to real art. It doesn’t have any physical or practical value. It’s a new fraternity.“
The concept of COMMUNITY, which is basically elitism, also gets constantly repeated. It is a kind of reaction to the society’s current lack of uniqueness. These are NFT hoarders, collecting junk with the hopes of one day purchasing shiny cars and luxury properties “out there”. Davis sums it up: “In the NFT community, we are witnessing the logical conclusion of a generation that is so alienated, so profoundly unfulfilled, that they are considering abandoning the physical world altogether. At least the metaverse is something new — maybe somewhere they can be rich, or important.”
It’s the same generation, she says, that dreams of the humankind “approaching a singularity where our digital selves (the version of ourselves in the metaverse) will become more important to us than our physical selves”. By then, we won’t see any issue in spending money on digital assets, which will have become more important than the physical ones. But the difference is that there is no inherent scarcity in the digital world. Any scarcity in this metaverse economy would have to be imposed — against the nature of the medium, with great effort and energy cost.
After all, it is certainly not an isolated opinion that NFT is just a pyramid scheme. Moreover, it is wrapped in the dirt of burning unnecessary energy.
Update: Read Thibault Verbiest’s analysis of how the EU is trying to regulate DeFi (decentralised finance) and how much of a difference it can make. Similarly on NFT regulation here.
Making ownership great again? Hardly
Will the metaverse improve the areas of copyright and ownership, as is being promised? It may well be the other way round. The Guardian already reports on the “huge mess” of identity theft and plagiarism around NFTs. While breaking into blockchain may be almost impossible now, the first one to do it wins. And there are already plenty of artists whose identities can be claimed by virtually anyone. According to the NBC, NFTs have even brought along a new wave of piracy.
Copyrighting could also become a nightmare when it comes to objects existing in the multiverse. Even if they’re just open source. A snippet of sound, a color, a gadget you buy for your avatar… Is that handbag real Dior? And who cares anyway? But what about copyright algorithms? It’s going to be an extremely complicated world.
And Web3 doesn’t even address the issues of advertising, media, or royalties.
While torrents used to be a tool for “liberation” by ignoring property rights, NFT is the exact opposite. It’s about centralizing copyright and maximizing copyright protection. But the author is not primarily the one who creates something, but the first to market it.
Update: The highly dominant OpenSea marketplace has even declared itself that more than 80% of the NFTs created by their free tool are are fraud or spam.
Oh, and what about porn?
According to an analysis by SexTech Guide, leading sex portals are worried that if the world of Meta (which includes VR glasses manufacturer Oculus) dominates the metaverse, even showing nipples will be made illegal. Yet, porn is one of the main reasons people are already interested in VR, notes Daniel Abramovich, CEO of the successful VR Bangers portal. It is likely that people will be pushed into some kind of closed ghettos where more liberal behavior will be possible. But the same goes for political views. Why would the Big Tech allow inconvenient views in their own universe? Again, the recent ban of Donald Trump on Twitter will seem like ridiculously primitive stuff by then.
It’s going to be fine
Cointelegraph describes how everything we have been criticizing here is going to change at some point. They hope it’s just the first stage. The wrong projects will fail and eventually, the right ones will win. They also believe it’s all headed in the right direction. As much as one tends to doubt it, TikTok is simply more democratic than HBO. Which is better? That’s another question. 🙂But as philosopher David Chalmers writes for The Guardian: Just get over it. Virtual reality is the new reality. And it’s going to happen.
Who is going to want to pay for services that corporations offer “for free” today?
Data centers, AI, YouTube, maps, communication tools. Today, all of these are funded by the companies’ ownership of your data. If the metaverse is created and paid for by corporations, we will become even more dependent on them (which Zuckerberg’s, Apple’s, and Google’s dreams are made of). The only other option is a paywall on all the services in W3. But history shows that people have always preferred giving up their privacy to giving up money.
Will there be elections under the potential AI rule?
If AI controls the metaverse, will we be given voting rights? Or will we rather become the metaverse owners’ property? Then it would be a dictatorship, not democracy. Is the progress we have made when it comes to human rights digressing a thousand years back?
About the author: Jan Strmiska founded and worked as editor-in-chief of the Czech edition of T3: Tomorrow’s Technology Today. He later spent 13 years writing for the Maxim magazine and now works at the venture builder, Creative Dock.