Metaverse

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Where did the idea of metaverse originate from?

The term metaverse was conceptualized by Neal Stephenson in his science fiction novel ‘Snow Crash’ published in 1992. In this book, he envisioned the future tech innovations that we would be living with. One of the most inspiring inventions Neal conceptualized was something called the metaverse, a fantastical universe where users have computer-generated bodies, go shopping, hang out with friends and have a fun time.

In the “Snow Crash”, the main character and protagonist, Hiro, lives in small storage unit with a roommate and living a miserable life in the real world. However, in the metaverse Hiro lives in a mansion and lives the fullest life that he wished he had. He appears as a customized avatar in this digital world and accesses the metaverse by wearing goggles and earphones. In the novel, Stephenson featured encrypted electronic currency that is similar to today’s cryptocurrency and further explored the idea that people would spend real money on virtual real estate. Although it was a futuristic idea back 30 years ago when “Snow Crash” was written, many tech companies are presently competing to enter into the metaverse space as they envision it to be the near future.

This process achieves its name of additive manufacturing through the method it creates the designs. These objects are created via successive layers of a desired material, starting from ground up and building into a specified shape.

What is the Metaverse?

The metaverse is a unified virtual space where users can perform interactions with virtual objects and with each other by using self-sustaining elements of the surrounding virtual world. The metaverse will have its own economy and will support a digital life almost as rich as our real-world. The metaverse is closely related to social media in several aspects such as making purchases, meeting people, learning new things, working, and making money without having to exit the physical world. There can only be one metaverse, uniting all of the virtual worlds built by developers, VR companies, and social media giants like Meta. The true value of the metaverse is to forge and strengthen meaningful connections where unlimited number of users can experience this virtual ecosystem.

How it Works?

The metaverse is a digital 3D universe where users can enter this universe using their virtual identity in the form of digital avatars and can move across various metaverse spaces. The difference between this digital world and the physical world is that you can experience everything from the comfort of your home in the digital world.

Software

One of the main and essential components to run the metaverse is the software. The metaverse utilizes virtual reality, augmented reality, artificial intelligence, machine learning, blockchain, augmented reality cloud, internet of things, spatial technologies, head mounted displays (HMD), and 3D reconstruction to create the virtual world. It also needs the support of software tools, apps, platforms, hardware, and content generated by users to enhance the overall user experience.

The transactions within the metaverse are made using non-fungible tokens (NFTs) and digital currencies. Blockchain validates value transfer, credibility, and data storage within the metaverse. Augmented reality (AR) enables 3D visualization of objects, interaction in real time, and the merging of the virtual and real worlds. Virtual reality (VR) provides users with a sensory experience like that of physical reality and requires more expensive equipment like multi-modal screens and head mounted displays (HMDs). Although wearing the VR headset and other gear is not required in metaverse, experts believe that VR is an essential part of the virtual environment. 3D reconstruction helps in creating virtual spaces that make the space look natural, leading to the formation of a digital ecosystem that is almost like the real world. Advanced computer graphics assists in ensuring comfort to its customers by collect a lot of images and graphic design.

Web 3.0

Metaverse technology is a core feature of Web 3.0 and some metaverses will be built using blockchain systems and open standards. Blockchain and blockchain standards help the metaverse to create a decentralized nature of network where users can connect with one another without any third parties.

NFT's

Non-fungible tokens (NFT’s) are a method of payment or a way to represent real-world assets within the metaverse. For example, in the Decentraland metaverse, users can trade NFT artworks or charge for admission to a virtual show or concert. They can also make money by trading land, which has seen a significant increase in value in recent years.

Centralized vs. Decentralized

There are two types of metaverses, centralized and decentralized. In a centralized Metaverse, there is one single entity governing the entire network, with internal servers and the policies set up to regulate the virtual world. In centralized environments the virtual community lives within a regulated space and the users are limited within those parameters. The community can interact together and share experiences, but they don’t have the freedom to control or own pieces of the digital environment

In contrast, a decentralized Metaverse is an open-sourced platform and users have the freedom to control their own experience almost entirely. The control of the platform lies within the community through a control that is governed by users; meaning they have a lot more individual control over not just their own individual assets, but over the way the Metaverse itself is built and operates. The decentralized Metaverse is emerging hand-in-hand with blockchain projects and we’re starting to see some opportunities emerge.

Facebook

In October of 2021, the parent company of Facebook changed its name from Facebook Inc. to Meta in order to "reflect its focus on building the metaverse". According to Meta, the "metaverse" refers to the integrated environment that links all of the company's products and services. As of 2022, Meta has more than 10,000 employees building metaverse-related consumer hardware such as AR glasses. Meta CEO, Mark Zuckerberg, anticipates these glasses to become as common as smartphones. Zuckerberg stated that over the next several years, “[Meta] will effectively transition from people seeing us as primarily being a social media company to being a metaverse company”.

Horizons World

Horizons World is a free virtual reality, online video game with an integrated game creation system developed and published by Meta Platforms for Oculus Rift S and Oculus Quest 2. It was released in the U.S. and Canada to people 18 years or older on December 9, 2021 after an invite-only beta phase.

This open-world allows players to explore the space around them while interacting with each other's avatars. The hub world (also known as "plaza") includes portals to featured user-generated worlds, which are created by players using an integrated game creation system. Meta believes that Horizons World will serve as the foundation for a full-scale metaverse in the future.

As of February 2022, Horizons World has a monthly userbase of over 300,000 people and contains over 10,000 user-created worlds. A private Facebook group for creators has over 20,000 members.

Zuckerberg stated that a mobile version of Horizons Worlds is planned for late 2022.

Investments and Future Potential

Metaverse is one of the most trending terms in the global tech market. Companies developing metaverse are focused on building new innovations and features to enable users to interact with each other efficiently and effectively in the digital world. Metaverse companies are at the forefront to transform the digital world with immersive experiences in the future. A few of the top companies developing metaverse include Meta, Apple, Amazon, Snapchat, and Epic Games.

McKinsey and Company Report

In 2022, McKinsey and Company, a global consulting firm, published a report that explores the value creation from the Metaverse. They found that in 2021 alone, venture capital and private-equity funding into the metaverse reached $13 Billion. They found multiple factors driving the investor enthusiasm, including ongoing technological advances, increasingly consumer-led brand marketing, and marketplace readiness from corporations. Additionally, investors have taken notice of the growth in the gaming industry and believe that the metaverse is another sector in which E-Sports can thrive. With all these promising features, McKinsey and Company estimates that the value of the metaverse could reach $5 Trillion by 2030. They state that the metaverse is shaping up to become the biggest new growth opportunity for several industries in the next decade. This virtual world opens many doors for business-to-consumer and business-to-business transactions. Many companies have already started implementing their business strategies in an effort to stay ahead of the curve as the Metaverse begins to scale. The report states that in 2022, investment into the metaverse space is already more than double what it was in all of 2021, at upwards of $120 Billion. A large portion of this sum comes from Microsoft's planned acquisition of Activision for $69 Billion. A big reason for this move is to help build their version of the Metaverse and enhance the gaming components of their virtual world.

Education

The educational sector took a big shift when the COVID-19 pandemic turned our world upside down. Many were forced to stay at home and access courses through various devices such as phones, computers, and laptops. Despite moving out of the pandemic, we are seeing lasting effects on how individuals approach technology and its application in the educational sector.

Functions of Metaverse/VR

The Metaverse can help educational needs across the world in various ways. There are four distinct ways by which Virtual Reality (VR), and as a result, the Metaverse, can help improve educational experiences [1].

Dangerous Activities

North Dakota's Virtual Reality Lab
North Dakota's Virtual Reality Lab[2]

The metaverse allows users to enter a world free of consequences of the real world enabling a wide variety of new experiences. Individuals are able to rehearse or practice dangerous activities by simply wearing a headset and not needing to risk themselves or others [1]. VR is being used for a number of different professions such as pilots, doctors, police officers, and drivers [3]. Many airlines have simulators to help train their pilots before training them on actual planes.

Simulating an Inconvenient situation

The classroom environment tries to prepare you for every situation possible, and it can. However, some scenarios are hard to prepare for without actually experiencing it firsthand. Using the metaverse, we can simulate certain counterproductive or inconvenient situations by making the scenarios more realistic [1].

E.g. A class of future teachers is being taught how to deal with disruptive students that refuse to listen. Teachers likely study different methods of de-escalation on how to resolve the issue, but until they are in the classroom experiencing itself it can be hard to hone their skills. The metaverse can be used to supplement classroom material to help train teachers [4]. The best solution is to give teachers hands-on experience in such situations. However, in scenarios where this isn't possible or you wish to give more training, simulating classrooms using the Metaverse is a viable option to teach individuals.
Antartica Through the Lens of National Geographic Explore VR Lab
Antartica via National Geographic Explore VR Lab[5]

Performing the Impossible

The Metaverse enables us to see the impossible in a virtual world [1]. Activities such as viewing internal human body organs via a headset for educational purposes are possible without the need for human or animal cadavers [1]. For history class, instead of imagining what the Romans lived like, you could enter a Metaverse that puts you into the Roman empire where you would be able to explore the kingdom for yourself [1].

Expensive and Rare Experiences

The Metaverse can also help make experiences more accessible by decreasing their price. With an NBA subscription, you can gain access to VR courtside seats [6]. These seats can cost thousands of dollars, but with a VR headset, they are much more affordable.

National Geographic VR allows users to immerse themselves across the world in popular tourist destinations such as Machu Picchu and many other locations [6]. Antarctica is also another location that is offered that very few people can access due to physical limitations [7]. Being able to experience them in real life may not be a substitute. However, for individuals that cannot travel due to financial reasons, the Metaverse offers them an affordable alternative.

The Stages of Learning With Metaverse

There are four stages of learning with the Metaverse, and each gets progressively more immersive. The simplest way to learn through the metaverse is through perception and simulation [1]. Using a VR headset, you can see things being shown to you visually and audibly. In this stage, you do not control what is being shown to you as you have no control over it. A commonly seen example of such is YouTube VR videos that allow the user to see in 360 degrees [1].

The next stage builds on the last and allows users some control. With limited authority, they can have an impact on what is shown to them [1]. VR Museums became popular during the COVID-19 pandemic and allowed users to guide themselves through museums. Individuals control the pace of movement, determining how long they wish to stay at each exhibit. They are still limited to a small amount of content and interactions. What is shown to them is still predetermined.

The third stage concedes more autonomy to the user, allowing them to control their learning with their decisions [1]. Similar to the museum, Google VR also allows users to control the pace of content, and movements. However, users are now not bound to a predetermined space. Google Earth provides a vast environment where users can visit anywhere they want and learn about the location, unlike the museum where the learning material was chosen.

The final stage of learning ends in the addition of presence [1]. This is typically representative of what we perceive when the word Metaverse appears. It is an extremely interactive world that allows for collaborations and interactions with other real individuals [1]. Users believe they are in a space that is separate from the one outside of the headset [1].


Work

The educational implications previously mentioned significantly affect the workplace. In the workplace, individuals are constantly learning with and teaching each other. So logically, the way people learn will impact the workplace. The Metaverse can help individuals train employees more efficiently by saving money and time. Real-world training can be expensive. The Metaverse can offer solutions to those by allowing lower cost training to be more accessible. E.g. Surgical training with VR. It also allows employers to train more employees at once. Spaces or scenarios in the Metaverse can easily be replicated, while they cannot in real life.

Work From Home

Vspatial - A virtual workspace offered by Meta
Vspatial - A virtual workspace offered by Meta[8]

Work from home became extremely popular during the pandemic, as individuals were forced to stay within the confinements of their own homes. A survey done by Owl Labs found the following statistics about the popularity of work from home:

  • 23% of workers would take a 10% pay cut to work from home [9].
  • 59% of workers would be more likely to choose an employer that offered remote work over one that didn’t [9].
  • Individuals were saving nearly $500 per month by staying home during the pandemic [9].

A strong appeal of the Metaverse within the work from home concept is the idea of a virtual office. Working from home offers the great benefit of working from home, but alongside comes the issues of distractions. Using a headset would allow your eyes to not wander off. Distractions would be invisible to you allowing for a productive work environment.

The Metaverse allows for the introduction of a more accessible selection process. If you are working from home, you can virtually work from anywhere. This allows you to select from a wider group of candidates [10]. When selecting new recruits, virtual interviews can better select candidates across the world. They can allow the interviewer to see the reactions, expressions, and body language of the interviewees better than a typical video call would [10].

Work from home typically comes with several mental challenges. Issues such as employee isolation, a lack of team bonding, and a disconnect between the employer and employee have created hesitancy towards the shift to work from home [11]. The metaverse can offer a solution to these and help alleviate these issues by bridging the gap of separation the common web camera version offers. The Metaverse offers a more interactive experience online with more immersion creating stronger human connections [12]. Some companies have even opened up virtual spaces such as offices for workers to use in the Metaverse [13].


Recreation

Gaming

Currently, the gaming sector is the main driver behind the metaverse. It enhances the experience and engagement of the users. Virtual world games such as Horizon Worlds, The Sandbox, and Minecraft allow players to build, own, and monetize their gaming experiences. Players can enjoy playing other players' games or create their own games in the virtual worlds with no coding experience required. Minecraft and Fortnite (Battle Royal game) are the most popular metaverse games, with over 80 million monthly active users. The majority of the players are in their teens. Therefore, as they enter the workforce and become decision-makers, they may be more accepting of adopting the metaverse in their everyday lives.

Virtual Events

Virtual events have become popular in the past couple of years due to the Covid-19 pandemic. The music industry saw declining revenues due to the cancellation of shows. However, famous artists such as Travis Scott, Diplo, and Ariana Grande were able to perform through virtual concerts. For example, on April 23, 2020, Fortnite hosted Travis Scott for a concert which lasted about 15 mins and saw over 12 million live participants, and earned Travis Scott about 20 million dollars.

Live sports is an exciting space in the metaverse. NextVR is a company that specializes in recording live events to be experienced in VR. With the Meta Quest 2 and the NextVR app, one can be courtside at a basketball game while at home.

Fitness

Factors such as location, cost, time, and weather can limit the ability of individuals to participate in and enjoy fitness. The metaverse can be significant in the fitness industry by making it more enjoyable and accessible for everyone. Supernatural is the most popular fitness game on Meta's Oculus VR. From the comfort of one's home, people can enjoy fitness in diverse virtual worlds and even join live sessions with an instructor.


Potential Challenges

Identity

Developers and creators of the metaverse will have to overcome the challenge of bots and identity theft. We expect to see new verification methods develop in the near future.

Laws and Jurisdiction

The lack of established legal policies can increase the likelihood of crime and abuse in the metaverse.

Currency

With the recent volatility in NFTs and Cryptocurrencies, a challenge may be that users won't feel safe when holding any currency or conducting transactions in the metaverse.

Devices

VR headsets are heavy and have caused headaches and nausea when worn for too long. Therefore more research and innovation need to be done to reduce these issues.

Authors

Darshpreet Badyal Kushal Patel Haj Sandhu Sohrab Sarhadi
Beedie School of Business
Simon Fraser University
Burnaby, BC, Canada
Beedie School of Business
Simon Fraser University
Burnaby, BC, Canada
Beedie School of Business
Simon Fraser University
Burnaby, BC, Canada
Beedie School of Business
Simon Fraser University
Burnaby, BC, Canada

References

  1. 1.00 1.01 1.02 1.03 1.04 1.05 1.06 1.07 1.08 1.09 1.10 1.11 1.12 https://www.researchgate.net/publication/358497370_Metaverse
  2. https://www.halldale.com/articles/16434-enhanced-pilot-training-via-vr
  3. https://books.google.ca/books/about/Experience_on_Demand_What_Virtual_Realit.html?id=2fkqDwAAQBAJ&source=kp_book_description&redir_esc=y
  4. https://www.frontiersin.org/articles/10.3389/fict.2016.00026/full
  5. https://www.imdb.com/title/tt11000416/?ref_=tt_mv_close
  6. 6.0 6.1 https://www.oculus.com/blog/go-courtside-in-vr-with-nba-league-pass-games-in-venues-on-oculus-quest/
  7. https://www.oculus.com/experiences/quest/2046607608728563/
  8. https://www.roadtovr.com/vr-apps-work-from-home-remote-office-design-review-training-education-cad-telepresence-wfh/
  9. 9.0 9.1 9.2 https://www.apollotechnical.com/statistics-on-remote-workers/
  10. 10.0 10.1 https://crysberry.com/6-jaw-dropping-virtual-reality-benefits-businesses/
  11. https://everhour.com/blog/challenges-of-working-from-home/
  12. https://cyberscrilla.com/metaverse-pros-and-cons-the-top-benefits-and-drawbacks/
  13. https://www.protocol.com/workplace/virtual-office-metaverse
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