By Jay Jayamohan
You know that ‘virtual’ is remarkably close to ‘illusion’ and ‘augmented reality’ is another word for ‘where things appear to be present.’ So, the question is does metaverse provide solutions to real world problems and create opportunities for businesses and aspiring entrepreneurs or is it all an ‘illusion’? The truth is you already live in the virtual world where you care more about what you look like on Instagram and Facebook than in real life.
If we go by the struggles of the company that renamed itself to ‘meta,’ then we are certainly years away from being a useful technology. According to a recent Wall Street Journal article ‘Nearly a year after Mark Zuckerberg rebranded Facebook as Meta Platforms Inc. in a bet-the-company move on the metaverse, internal documents show the transition grappling with glitchy technology, uninterested users and a lack of clarity about what it will take to succeed.’
So my attempt here is to simplify what metaverse is and layout the opportunities if/when the promised land arrives.
What is it?
According to Wikipedia ‘A metaverse is a network of 3D virtual worlds focused on social connection. In futurism and science fiction, it is often described as a hypothetical iteration of the Internet as a single, universal virtual world that is facilitated using virtual and augmented reality headsets. Author Neal Stephenson is credited with coining the term “metaverse” in his 1992 science fiction novel “Snow Crash,” in which he envisioned lifelike avatars who meet in realistic 3D buildings and other virtual reality environments.
Metaverse is one among many of the exponential technology change and compressed transformation that is happening at an astonishing speed. In this age, the pace and scale of change continues to accelerate and grow—possibly the greatest seen in human history that by the time we consider and evaluate what’s happening now, it has already become past.
For leaders of companies trying to figure out the relevance, metaverse is an evolution of the internet that enables a user to move beyond browsing to inhabiting, in a shared persistent experience. Like many emerging technologies, experts differ in how to define it, and there is a great deal of hype being generated. Most of the focus is on the consumer applications of the metaverse, and many dismiss it as a consideration for the future. But for leaders, in this age of exponential technology change and compressed transformation, it is important to understand the Metaverse from the pace and scale of change that it can bring and evaluate the potential opportunities.
Leaders need to step back and fundamentally reimagine how you will approach your business for the next decade – which worlds you will define and design, starting now. While we are at the early days of the metaverse, it will advance and you do not want to find yourself operating in worlds designed by, and for, someone else. It’s time to think big but start small.
In its essence, the Metaverse is about the creation of expansive new experiences, in both virtual and augmented physical spaces. This could be where people can experience work, where they socialize and where they shop in ways that are being invented or reinvented right now. Metaverse could be considered the ‘internet of place and ownership’ that will change business models and create opportunities for rebranding, acquisitions, and investments.
Why does it matter?
Why the metaverse is important for businesses is that it is the is the next step in the evolution of the Internet. This evolution started with an Internet of Data in the 1990s that moved to the Internet of People in the 2000s as we all became increasingly connected. In the 2010s, we saw the Internet of Things with connected phones, devices, and machines. And in this decade – the 2020s – we are seeing two evolutionary developments.
First, we have the Internet of Place, which is the metaverse form that brings people, spaces, and things in both the virtual and real world together. Vail Ski Resort in Colorado has built a digital twin of its resort, an intelligent virtual world mirroring their physical mountain, including details like real-time snowfall, years of weather data, and critical mountain infrastructure.
And then there is the Internet of Ownership, which is the metaverse function. Bursting from the crypto community, NFTS are enabling unique, portable, persistent digital objects to be created, exchanged, and valued in a market. A fitting example is the National Basketball Association (NBA), which just auctioned 30 unique NFTs, one-of-one digital collectibles representing every NBA team that grant each owner a VIP pass for the ultimate fan experience at the next five NBA All-Stars.
A key component of the internet’s evolution going forward is Web3, which technologies like blockchain and tokenization to build a more distributed data layer into the internet. If you put all of this together, we are now entering a new and even larger era of digital transformation.
Luxury brands are getting in on the action. As Vogue Business notes, Gucci was quick off the mark in May when 20 million users visited its virtual Gucci Garden on the Roblox platform. In just two weeks, hundreds of thousands of users bought multiple limited-edition avatar items from the garden’s virtual store. Gucci’s Dionysus bags even sold for more than the usual price of the physical equivalent. Vogue Business found that users who bought these virtual Gucci items “wore” them five hours longer than other accessories.
Fashion house Balenciaga teamed up with Epic Games to debut its autumn/winter 2021 collection in VR, offering a special line of in-game outfits and accessories, as well as physical merchandise sold via the game. Balenciaga also released its spring/summer 2022 collection as a video using only one model and a computer-generated image (CGI) audience.
While the road to the metaverse is still being mapped, technology that makes real-world, physical scenarios available virtually and enhances enterprise offerings will play a role. Metaverse may start slow as the technology remains in a nascent stage, market competition will intensify as the tech titans battle for market dominance and non-tech brands track their progress for potential revenue and operational improvements.
From a technical perspective, this digital world will be accessible through a range of devices, from 2D models – smartphones, tablets, and PCs – to XR headsets and other 3D devices that gives the user a more immersive experience.
It is important to remember that we are at the beginning of the metaverse journey, and we will continue to see innovations and new capabilities over the next decade. Some of the key technologies that will power the metaverse includes Blockchain, Augmented and Virtual Reality, Hybrid and Distributed Cloud Environments, Internet of Things (IoT) and Artificial Intelligence (AI).
According to Pew Research Center ”54% of experts said that they expect by 2040 the metaverse WILL be a much-more-refined and truly fully-immersive, well-functioning aspect of daily life for a half billion or more people globally.”
The metaverse is powered by a converging stack of all the above technologies. Their maturity will be critical for seamless interaction between virtual and physical worlds. The way these technologies are converging with one another is transformative. Some of the creative use cases are proven and scalable while others are being piloted or just concepts. To assess their readiness for metaverse, organizations need to evaluate their technological maturity, and identify and fill gaps over the coming years.
As metaverse evolves, all of us have an opportunity to ensure it is developed with responsibility at the core, to foster trust. This includes safety, privacy, security, sustainability, equity, inclusion, accessibility, well-being and much more. For example, a top priority is addressing risk and guarding against fraud, criminal activity, and immature infrastructure—and being responsible for security and privacy for all metaverse experiences. In terms of sustainability, there are valid concerns about the metaverse taking more computer power and therefore producing more carbon.
So, whether you acknowledge or not, this is also about taking advantage of what you know and understand and applying emerging technology to new context. For example, business should look at metaverse to:
- Enrich the consumer experience
- Introduce virtual products, only available in the metaverse
- Collect new data on customers
- Market physical and digital products and services
- Support metaverse payments and finance
- Offer hardware and applications that support metaverse activities
Businesses that want to stay competitive should make plans for how they are going to engage with customers, find new advertising opportunities, and bring in sponsorships in the metaverse. The metaverse is less about becoming immersed in a fantasy world of unicorns and dragons and more about escaping physical limits to spend time in a virtual space that’s a version of, or extension of, real life. Instead of only reaching your physical store to get a try or test with the first new product, your customers can join or visit the exclusive launch party no matter where they are in the world. They can have the feeling, sense, and experience they can in the virtual world.
Ultimately, beyond business adoption, metaverse consumer platforms will transform how people play, shop, access media, and interact. The metaverse’s future will be interesting to watch unfold. Ilike all of you, I have more questions than answers on what it will ultimately become, but we can be certain that even if it seems like vaporware for now, meta is real as in having “attributes”.
What’s your next move on metaverse?
One advice that I can give is to look at metaverse just as you would look at any other technology – through the lens of business strategy. Suppose you think back to your most recent technology investment. Ask yourself: Where did it deliver the most value to the organization? You could probably point to a handful of specific instances where productivity improved and/or efficiencies had been achieved. But did it help? Were there indirect impacts? What does the data say? Did you achieve your ROI, or did you or leadership stop paying attention? These questions are a lot tougher to consider, and most people can’t answer them when they only look to solve each individual problem at a time.
But suppose you look at technology through the lens of business innovation. In that case, not a means to an end, but instead a multitude of resources for enterprise-wide transformation — suddenly, technology becomes something entirely different. It’s no longer a tool for a task but rather a way to scale teams and initiatives. When properly employed, technology can help you improve entire business processes, reaping returns across the whole company. The beauty of this approach is that the returns can compound. Use your ROI as a means to reinvest in the company, hire and retain top talent, implement strategic sales and marketing efforts, invest in upgraded equipment, materials, and infrastructure and more.
Strategy and strategic planning are no longer top-down exercises of showing brilliant foresight and driving focus and execution. In the new age of disruption and uncertainty, they consist equally of aiding high-velocity and high-quality decision making every day, leveraging digital and advanced techniques, and helping the organization become a learning, agile, and resilient one. Organizations that will not adapt to this new reality will fail to take the smaller everyday risks required to learn, and that will lead to a much bigger risk over time: extinction.
Thoughtful, focused investment is thus the most viable path to success, especially at a time of other thorny concerns, such as speed of technology changes, threats to supply chains, and environmental regulations. The best approach varies from one company to the next, because each has its own context and capabilities. But all successful approaches will involve the same overarching principles: a more specialized portfolio, a more focused value proposition, more rigorous fiscal management, and greater willingness to collaborate with other companies, particularly in metaverse-oriented innovation and capital investment.
In so many ways, technology is the vehicle for transformation, not the driver. As a leader, you are the driver. Remember that it is not the features that matter most, but where they can take you. You are at the beginning of the metaverse curve, so learn about it, keep an eye on its evolution and get involved in opportunities to shape the standards and protocols. The most effective technology strategy is proactive, not reactionary. To achieve that, leaders need to focus not simply on adoption but on making sure they have the right strategic goals, programs, and processes for managing the right outcomes over time, not just at a particular point in time.
Jay Jayamohan is the Executive Director of the Center for Innovation & Entrepreneurship at Harrisburg University (HU). He leads the effort that strategically positions HU to have a greater impact – economic & social – by having innovative thinkers and entrepreneurs coming together to collaborate on ideas and solve problems. He is also an Adjunct Professor at George Mason University School of Business and Member of Board of Directors at Nova Labs. Jay is a serial entrepreneur, having co-founded RollStream, JobNavs and Synteras. raised tens of millions in venture capital and won numerous accolades including ‘top supply and demand chain vendor, Washington Technology Fast 50 firm. Jay is a leading expert in disruptive innovation, design thinking, and strategic management and chosen as newsmaker by Comcast Newsmakers. Jay Holds an M.S in Management from George Mason University and Bachelors in Mechanical Engineering.