Blockchain Blog 20: Metaverse — The Future is here

Aakash S
Coinmonks

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History records epochs that impact human behavior and culture in ways that were previously unimaginable. The Industrial Revolution, in a relatively short period of time, materially impacted the lives of all people, industries, businesses, and governments through the invention and commercialization of new technologies.

These innovations impacted trade, products, society, art, and culture. The exploitation of many new technologies, inventions, and processes empowered entrepreneurs to conceive of new and fantastic opportunities.

In fewer than 25 years, the Internet has impacted the lives of every human on the planet, created unprecedented wealth, raised millions out of poverty, and changed every industry and business globally.

The emergence of the Metaverse over the next ten years will exceed the creative destruction brought about by the Internet and will empower the Creator Economy.

“Situations emerge in the process of creative destruction in which many firms may have to perish that nevertheless would be able to live on vigorously and usefully if they could weather a particular storm.” — Joseph Schumpeter

The power of creative destruction is exemplified by the fact that five of the world’s ten most valuable companies today exist solely due to the invention of the Internet: Amazon, Alphabet, Facebook, Tencent, and Alibaba. Together with Apple and Microsoft, whose primary value relies on access to the Internet, these companies represent $10.2 Trillion in value. That is 76% of the value of the top ten and equivalent to 48% of the annual United States GDP. An argument can be made to include Tesla on this list, as it wholly relies on the Internet for its global sales engagement. Most importantly, those five companies (six, including Tesla) did not exist in 1993. Facebook is only 17 years old.

The emergence of the Metaverse to empower the Creator Economy will usher in another epochal change brought about through creative destruction.

The Metaverse will impact all our lives in unimaginable ways and bring about behavioral change. Industries will be completely transformed in less than a generation, societies will function significantly different compared to today, businesses will operate in fundamentally different ways, and we will see the emergence of technologies and inventions that will exploit the fundamental behavioral changes that the Metaverse will enable.

Companies that are unknown to us today will emerge and dominate this new metaverse virtual economy and within a generation become the most valuable companies in the world.

Fundamentally, the Internet from inception was a publishing platform and has been exceptionally good at written language (publication, storage, promotion, discovery, monetization, and search). It has never been particularly good at video, live communication, gaming, and social media. With the invention and introduction in 2007 of the iPhone, the Internet evolved into the mobile internet (often referred to as Internet 2.0). This took the Internet from being only accessible to users with costly personal computers and direct internet connections to being accessible to anyone, anywhere who had a smartphone.

The mobile internet enabled websites to be accessible and interactive 24/7 using the tactile video display interface that mobile devices offered. This constant interactivity, along with the creation of device stores and the invention of apps, changed the way information and entertainment were produced and consumed. Real-time interactivity is the fundamental power of Internet 2.0 and the foundation of the Creator Economy.

Companies including YouTube, Facebook, Snapchat, Twitter, Uber, Netflix, Airbnb, and many others emerge and dominate due to the unlimited access the mobile internet enabled. We have also seen the explosion in popularity and use of mobile-accessible games, with 2.6 billion people playing mobile video games in 2020 and more than 80 billion downloads of mobile video games.

The Creator Economy is the reinvention of television in which control and monetization of content distribution is no longer dominated by a few large networks and media companies, but by the talent themselves who distribute directly to their audiences. It is the integration of content manufacturing and delivery with audience curation and discovery via social media and the mobile internet. It is dominated by User Generated Content (UGC) which is primarily edited videos made by individual creators and uploaded to streaming video on demand (SVOD) platforms like YouTube and Facebook.

More recently, User Generated Live Content (UGLC), which is harder and more costly to produce, has exploded via platforms like Twitch (owned by Amazon), YouTube Live, and Facebook Live. The scale of UGC networks dwarfs traditional media; popular YouTuber PewDiePie has 110 million YouTube subscribers and his videos have been viewed more than 27.5 billion times. Comcast, the largest cable TV subscription base, by comparison has 22 million subscribers.

The Metaverse

The Metaverse is the next generation of the Internet — the total convergence of streaming, interactivity, and social media. Content, communication, and interaction are presented spatially as deep, evocative experiences that drive consumer behavior and ultimately brand value. It is a virtual world where anyone can explore, experience, create, communicate, and participate in real-time (think of Steven Spielberg’s film Ready Player One). The Metaverse will disrupt every sector of the economy and our daily lives, most notably; Retail, Entertainment and Leisure, Design, Manufacturing, Medicine, Education, Transport, Telecommunications, Travel, Social Media, User Interfaces, and Content Creation.

Some users will engage with it like they would a massive multiplayer video game, others will use it to interact with their smart devices, shop, and experience content. For industry, the Metaverse will support micron-accurate simulations of production processes and eliminate the physical distance between teams.

The Metaverse will be the decisive technology of the Creator Economy, empowering the monetization and scale of live content and experiences by any UGLC creator in immersive, engaging, transactional social experiences with audiences. The Metaverse will be always on, always live, and enable real-time experiences just like a city that never sleeps. Ultimately, it will become the dominant global platform for creating and watching live content with significant added features like interactivity, real-time transactional functionality, branded promotion and integration, game mechanics and functionality, integrated socialization, blockchain and NFT capability, and deeply rewarding gamification tools.

“What the internet is for information, the metaverse is going to do for social connections. I’m no longer bound by physical distance or all these constraints in terms of who I interact with or how I represent who I am. All these things are suddenly unleased. It’s insanely disruptive.” — Roblox CEO Craig Donato.

The primary entry point to the Metaverse will be via a browser-based URL and a personalized avatar that people will be able to use to navigate a virtual metaverse environment with a mobile device using typical game engine mechanics. Our endlessly customizable avatars will be virtual versions of ourselves that hold our keys, wallet, and identity. We will purchase digital assets for our avatars such as clothing and jewelry and we will determine how much, if any, of our data we allow branded metaverses to access for them to customize our experiences.

Ultimately there will be billions of metaverses and there are two primary types of metaverses:

  1. Closed metaverses and
  2. Open metaverses

A closed metaverse is only accessible through a download of a proprietary source IP which users are required to sign an end-user license agreement to access. Video games like Fortnite, Roblox, Call of Duty, Minecraft, and League of Legends are all examples of closed metaverses.

Open metaverses are accessible by anyone who creates an avatar and enters it via a browser and a URL on a PC or mobile device. In the next few years, every brand in the world will need to invest in an open metaverse first strategy. Consider a global brand such as Amazon. Today anyone can access the Amazon website via a browser and find millions of items for sale. It is a one-dimensional experience focused on shopping. I cannot talk to other potential Amazon customers about the product review or a seller. I cannot hold an object as we do in a shopping mall. An Amazon metaverse would enable all that and much more for my personalized avatar.

Or what if we don’t even need Amazon or Facebook, and we have some open decentralized shopping experience powered by Blockchain and Web3.

The Metaverse also excels in the augmentation, advancement, and enrichment of real-time social media interactions. The Metaverse enables interaction in a way that replicates the physical way we communicate with the addition of AI tools. In the future, our avatars will meet friends in a metaverse to explore and share common experiences, go shopping together, visit family and friends, attend virtual concerts and conventions, visit galleries and museums, even go to school. We will share our virtual experiences on our other social media platforms and some of us will live to stream our metaverse experiences and interactions for passive consumption by our followers on platforms such as Twitch. The Metaverse will power communities in unique ways. Certain communities that scale will create their own metaverses and operate their own economies. The breadth of opportunity that the metaverse empowers is enormous.

The Metaverse is already here. Some of the world’s largest companies are heavily investing in their version of the metaverse alongside the nimble startups who are pioneering the future of the Metaverse.

I’ll leave a video for you to watch. The video displays the other side of Metaverse. But I believe, the future is, what we work for.

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