Where do we stand in 2022?

Deloitte I 9:00 am, 16th August

While 2022 will see plenty of hype and financing around "the Metaverse", it is still unclear what it will ultimately look like or which technologies it will use. Still in its infancy, the concept of the Metaverse is so broad and potentially transformative that it is prone to oversimplification and speculation. Therefore, organizations and investors need to tread cautiously when evaluating its short-term potential.  

But what is the Metaverse, and how could it work?  

The Metaverse, by most definitions, is a 3D digital representation of the "real world" that exists online, alongside the physical world. Through digital avatars of themselves, users can socialize, play games, learn new skills, deliver products and services, and shop. The Metaverse can be experienced in real-time, meaning it could evolve the current, "flat" internet into a 3D spatial form that is always available to all.  

By combining platforms, experiences, audiences and marketplaces into one shared digital world, users can seamlessly move between different locations, activities and events. The Metaverse’s digital economy would allow people to create, sell and buy goods that can be used across different platforms. For example, a user can buy a virtual outfit in a shop to wear at a virtual conference—just like in the physical world.  

To help bridge the digital and the real world, the Metaverse could offer augmented reality (AR), virtual reality (VR) and mixed reality experiences. For instance, digital twins, remote collaboration and 3D simulations could be integrated into an organizational or industrial Metaverse, combining both worlds to offer a seamless and unique experience.  

An early example of Metaverses are popular social-gaming platforms, which already host tens of millions of people in virtual worlds. Players customize their avatars with virtual clothing and gestures, brands promote and sell virtual goods, media franchises create in-game experiences based on their IP, and top musicians perform in front of millions of fans worldwide. These platforms do not yet harness AR, VR, NFTs or spatial computing.  

So, does this mean that the Metaverse has already arrived? After all, many related trends are already on the rise, including shoppable media, virtual meetings, social camera filters, motion capture, AR for apparel and furniture shopping, spatial computing, and immersive learning. However, for the Metaverse to fully realize its potential as an interconnected 3D world, it requires the significant adoption and interoperability of emerging technologies, while establishing greater trust and safety. 

For example, if the Metaverse requires advanced AR or VR technologies, it still has some way to go. Consumer AR is still on smartphones, and only an estimated 16 million consumer VR headsets are sold per year, compared with more than a billion smartphones. Both technologies have hardware limitations, ergonomic challenges, and other potential problems. If the Metaverse needs 100 million users willing to wear headsets as often as they check social media, it could take more than 20 years to achieve this. However, hyperscale technology platforms are already recognizing the competitive benefits of controlling the Metaverse and are investing accordingly.  

The Metaverse also needs a community for stickiness and monetization. Metaverses that require more interaction, like social media, could amplify bullying, harassment, misinformation and algorithmic bias. As a result, companies adopting a Metaverse strategy must prioritize community well-being and consider ways to mitigate social problems before they arise. For instance, what are the potential social and psychological consequences of widespread virtual immersiveness?  

The more connected the internet is to the physical world, the more time we spend in the digital world. Despite the many challenges ahead, a Metaverse that spans virtual and physical spaces is a likely next step in technology’s evolution. However, its full realization and widespread use could take years.  

Therefore, in 2022, organizations should focus on building blocks, short-term use cases and early Metaverses that are currently prosperous, while laying the foundation for the future. 

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