The metaverse is dead. Long live the metaverse

The failure of the metaverse, the multi-billion dollar project spearheaded by Mark Zuckerberg and Meta, has been well documented. But Insider has gone one step further and published its obituary.?

It’s “the latest fad to join the tech graveyard,” Ed Zitron , CEO of tech PR firm EZPR, wrote. “The metaverse, the once-buzzy technology that promised to allow users to hang out awkwardly in a disorientating video-game-like world, has died after being abandoned by the business world. It was three years old,” Zitron wrote.

The main “killer” of the metaverse is widely believed to be the swift adoption of AI language processing like ChatGPT as “the next big thing,” as tech developers look to build the future. Even Zuckerberg admitted defeat (or at least a change in focus) in March:?

“Our single largest investment is in advancing AI and building it into every one of our products,” he wrote to employees. “We have the infrastructure to do this at an unprecedented scale, and I think the experiences it enables will be amazing.”?

So is the metaverse really consigned to the scrap heap of history? Does the seemingly single-minded focus on AI mean the billions it would take (and has taken) to build metaverse infrastructure will never be spent? And given that virtual reality has been in our science fiction lexicon for generations, is it just Meta’s metaverse that is dying??

“Unsurprisingly, ‘VR [virtual reality] Chat but with capitalism’ simply wasn't an appealing pitch for the vast majority of consumers,” Grant St. Clair, of tech culture site BoingBoing, said. “The companies that did make a bet on their own virtual space found them expensive, far too niche, and ultimately inferior to a traditional, flat website in every way – not to mention the layoffs that resulted once they realized this.”

What a lot of the coverage is missing is that Zuckerberg’s Meta isn’t the biggest spender on metaverse initiatives. Microsoft is. Google, Fortnite creator Epic Games, shopping platform Shopify, and many others are continuing to spend heavily in this area, just without the level of “big announcement in virtual reality without legs” fireworks presided over by Zuckerberg. It has also ignored the fact that if a widely adopted metaverse is to be built, it will rely on a lot of AI technologies that aren’t quite ready yet.?

A tale as old as p*rn

“We’ve been waving this red flag. There is simply too much promised in this area,” Emma Mohr-Mcclune , an analyst at GlobalData, said in a podcast. “The metaverse winter [is] a moment of retreats and retools and see what happens… there’s a recognition that there’s going to be some niche players come in here, possibly on the devices front… and start to propose new use cases and alliance and ecosystems that we’ve never seen before.?

”We shouldn’t just assume that the Android, iOS duopoly will continue. We might need a whole new kind of operating system.”?

It’s a tale as old as p*rn*graphy. The industry audiences are most likely to engage with new technology first is the adult one. Despite the “myth” that VHS beat Betamax because of access to adult content, the power of the $45 billion industry cannot be underestimated with how early adopter consumers discover new devices. For now, it accounts for around 11% of the global total augmented reality (AR)/VR revenue, according to BedBible, or around 3.4% share of the adult industry. The tricky thing is that Meta’s fight against all things “adult” is well known, and it had little to offer consumers.?

“The metaverse suffered from an acute identity crisis,” Zitron said. “A functional business proposition requires a few things to thrive and grow: a clear use case, a target audience, and the willingness of customers to adopt the product. Zuckerberg waxed poetic about the metaverse as ‘a vision that spans many companies’ and ‘the successor to the mobile internet,’ but he failed to articulate the basic business problems that the metaverse would address.”

The “basic business problems” are evident — is a meeting between two avatars any better than a meeting over Zoom? Definitely not yet. Is a VR tennis game anything close to playing tennis in real life or as easy to pick up and play as a tennis simulator? Nowhere close.?

"The metaverse I’m talking about is one where the physical, human, and digital realities are conjoined" - Joe Madden

Yet analysts are still saying that there is a trillion-dollar market here waiting for some sort of adoption moment to happen and change everything.?

“The global metaverse market was valued at $100 billion in 2022 and is projected to grow to $1.52 trillion by 2029, at a compound annual growth rate (CAGR) of 48%,” columnist Jurica Dujmovi? wrote for MarketWatch. “It's up to you to decide whether you want to be a part of it.”??

Regarding AI, a senior figure at Google admitted in leaked documents that open-source AI was likely to dominate in that space (not them, not OpenAI). Just as Google dominated search from scratch, Facebook did the same with social, a startup could come along and be the home of the metaverse, the next frontier of digital.?

Mohr-McClune’s analysis of “niche” players could come true. The tricky thing is that VR goggle manufacturer Oculus already tried that, before being bought by Facebook for $2 billion. And we’re in an age where things get big and then get bought. YouTube, WhatsApp, LinkedIn, Instagram, Beats, Slack, and many more were all brought under conglomerate umbrellas.?

Could a young entrepreneur, like Oculus co-founder Palmer Luckey , turn down becoming a half-billionaire by the age of 21? He bought a vintage Mustang convertible and a helicopter, so it’s easy to see how the next great innovators could be swallowed up by existing behemoths.?

This leaves the question of where the metaverse ends up. And if it becomes a short, unsuccessful pitstop on the road toward merged realities and a new combination of AR and VR, as some predict.??

“The metaverse I’m talking about is one where the physical, human, and digital realities are conjoined,” industry analyst Joe Madden said. “Through extended reality (XR), we can bring the metaverse wherever we go, rather than confine it to our homes and offices. This metaverse will embrace mobility; it will be equally at home in the consumer, enterprise, and industrial realms; and it will be built on the foundation of detailed digital twins mirroring our physical surroundings.”

That’d require 5G’s successor, 6G, to work everywhere; technology to fit processing power into a contact lens or into human-injected chips; and a significant shift in how most populations see the user case of technology. It’s much more than just a whole new operating system… it’s a whole new way of seeing the world.?

For now, the metaverse is dead. When technology catches up? Long live the metaverse, whether it be AR, VR, XR, or something else we haven’t even thought of yet. How very meta.

The questions we still don’t have answers to after researching this article: (all musings/questions/opinions welcome to [email protected] if you think you know the answers)?

1. Do we really have to wait for 6G for a metaverse to be tenable? 5G implementation has been slow, yet attention in tech circles has already moved to 6G, expected to be 100 times faster than 5G. For VR to be believable, it has to have zero latency. Does it really have to be 100x quicker than current capabilities will allow???
2. Do those trillion-dollar valuations stack up? The trillion-dollar+ market value seems high given recent developments, but something involving virtual reality (and all its associated terms) is the next logical step in digital life. What does that mean in practice? And how financially massive will that end up being??
3. Will it be Zuckerberg, Microsoft, Google, or someone we’ve never heard of who cracks this? The recent trend of Big Tech buying any potential competitors before they become too big is likely to continue but could one startup pop up and be the Facebook of the VR age??