Does the Metaverse really already exist? or is it just a mix of virtual, augmented reality, blockchain and other technologies? And what can be done in the Metaverse? Here is the in-depth analysis
Metaverse , in Italian “metaverse”, is a virtual world, mostly still hypothetical, which can be accessed by a particular virtual reality (VR) and augmented reality (AR) technology. The idea is to create a sort of higher-level Internet, overlaid on the physical world. People connected to the metaverse are part of the physical world, but they can see and interact with things that others cannot see, because they belong to a virtual world .
Since this is still just an idea, there is no single definition of the metaverse that everyone agrees on. What seems certain is that the metaverse could be to virtual reality what current smartphones are to the first, crude, cell phone models of the 1990s.
The Extended Reality market is well underway in Italy, with 231 active projects from 2020 to today , says research by the Augmented Reality & Metaverse Observatory of the School of Management of the Polytechnic of Milan. Many companies are already using, in consumer management or business processes, technologies capable of enriching the real world with digital elements or creating virtual environments or experiences. However, the actual Metaverse is yet to be defined: to date there are 212 different virtual worlds, but a fully interoperable digital universe does not yet exist. Yet, the attention of companies has already exploded: there are 445 projects at an international level in different worlds, with experiments in particular in Retail (37%) and Entertainment (27%).
According to the study The Corporate Hitchhiker’s Guide to the Metaverse , the Metaverse will be worth up to $400 billion within the next 3 years . According to the report ” Web 3.0: Metaverse and NFT “, created by EY in collaboration with the Luiss Guido Carli Research Center in Strategic Change , a considerable growth in the impact of the metaverse on the portfolio of services and products offered is expected in the next decade : Over 40% of respondents believe revenues will rise by 40% . 30% of Italian and foreign companies have already invested or intend to invest in the adoption of the main emerging technologies, including the metaverse; 25% intend to do so during 2023 . However, according to 64% of those interviewed, governments should further regulate the market, as the current legislation is not completely adequate to respond to the different scenarios enabled by Web 3.0.
What is the Metaverse
The Metaverse represents an immersive, persistent, interactive and interoperable ecosystem , composed of multiple interconnected virtual worlds in which users can socialize, work, transact, play and create assets, also accessing via immersive devices. This is the definition given by the Extended Reality & Metaverse Observatory of the School of Management of the Polytechnic of Milan.
Cathy Hackl , technological futurist and metaverse expert, interviewed by McKinsey Digital says: “I tend to have a rather broad view of what the metaverse is. I believe it’s a convergence of our physical and digital lives. It is our digital lifestyles, which we lived on the phone or computer, that slowly catch up with our physical lives . The Metaverse is enabled by many different technologies, such as AR (augmented reality) and VR (virtual reality) , which are the ones most people tend to think of. But they are not the only entry points. There’s also blockchain , which is a big component, there’s 5G , there’s edge computing and many other technologies. For me – continues Hackl – the metaverse is also about our identity and digital ownership. This is a new extension of human creativity , in some ways. But it’s not going to happen that one day we’ll wake up and exclaim, ‘The metaverse is here!’ It will be an evolution.”
Who is the “owner” of the Metaverse?
There is not a single Metaverse, but Metaverses. There is therefore no one who can say they “own” it. However, it was Mark Zuckerberg who officially inaugurated the new era : “We are at the beginning of a new chapter for the Internet, and it is also a new chapter for our company,” said the founder and CEO of Facebook on October 28, 2021, announcing the metaverse and Meta , the new name for Facebook. A term that derives from the Greek word meaning “beyond”. “From now on, we will be metaverse-first, not Facebook-first . This means that over time you will not need a Facebook account to use our other services,” Zuckerberg wrote in the letter to the founders.
How to enter the Metaverse
How to enter the Metaverse of Meta-Facebook
At the moment, Meta’s metaverse is not yet accessible from all countries in the world and the Horizon Worlds application , the starting point of the company’s strategy, is under development. However, to enter this type of Metaverse, the use of a VR headset is required , specifically the Quest 2 developed internally by Oculus (owned by Meta).
How to enter Decentraland
Decentraland is a world created by Ethereum where users can walk around, meet other users, create virtual buildings, and much more. All virtual items in Decentraland can be purchased with a cryptocurrency called MANA. To access, you need to go to the official Decentraland website , click on the Get Started button and select Play using your wallet if you have a crypto wallet. A wallet is a digital cryptocurrency wallet made unique by an alphanumeric code. To get a taste of the experience, simply choose Play as guest . The use of a visor is not necessary at the moment.
How to enter Sandbox
The Sandbox is a Metaverse on blockchain , where content creators can monetize their created assets, develop and play without the need to know programming languages, and then put everything up for sale via the internal marketplace. Its avatars have a blocky visual style like Minecraft and can build, own and monetize using NFTs and SAND. Sandbox has also partnered with over 165 brands to create avatars in the virtual world of famous people like Snoop Dog and The Walkind Dead. The Sandbox platform is not yet available but while waiting you can visit the site and interact with the community.
What can be done in the Metaverse
According to Gartner, by 2026, 25% of people will spend at least an hour a day in the Metaverse, for work, shopping, education, social media and entertainment. Unlike current virtual reality, which is mainly used for games, this new virtual world could be used for practically anything: work, concerts, travel, cinema. Or simply, as a substitute for leaving the house to meet other people . As? With a 3D avatar , a digital representation of ourselves.
Purchase clothing and virtual goods
Various fashion and luxury companies are starting to invest in virtual reality . Balenciaga sells “skins” on Fortnite, Gucci has put a virtual-only bag on sale and has already launched virtual fashion shows; Dolce & Gabbana obtained 5.7 million from the sale of 9 Non-Fungible-Tokens, Nike decided to sell “virtual” shoes. Along the same lines we find Adidas and Benetton. Ray-Ban and Luxottica have created a model of glasses that allows you to frame and take photographs or make videos to share in real time on social media. All thanks to an invisible camera positioned inside the mount. A small step towards the metaverse. According to Morgan Stanley , for the fashion and luxury sector, revenues from virtual reality could amount to 50 billion dollars (around 44 billion euros) by 2030 .
HERE ARE SOME EXAMPLES OF METAVERSE APPLIED TO THE WORLD OF RETAIL
Wallmart, the American large-scale retail trade giant, filed several new trademarks with the United States Patent and Trademark Office on December 30, 2021 which, according to specialized media, would indicate its intention to produce and sell virtual goods, including electronics , home decor, toys, sporting goods and personal care products.
-Visit exhibition areas
Randstad Italia, the first employment agency to have opened a space in the Metaverse of the blockchain company Coderblock last November, has also opened the Talent Space to other important Italian businesses since September 2023. In fact, Agos, Enercom Group, Silea, Prysmian Group, Tea Group also landed in the virtual spaces provided by Randstad , thanks to a working group of the Startup Thinking Observatory of the School of Management of the Polytechnic of Milan, with the aim of exploring the possibilities of this new technological frontier in creating personalized experiences for users.
At the virtual spaces made available by Randstad, visitors will have the opportunity to explore an expo area that hosts customized partner stands, offering them the opportunity to interact directly with all the brands. This experimentation fits into a context in which immersive reality is gaining ground in the world of work, offering an engaging and interactive experience to attract and engage new talent.
– Buy land
Carrefour has purchased land equivalent to 36 hectares in the virtual world of the video game Sandbox. Created by the French studio Pixowl, Sandbox allows individuals and businesses to become owners of land and exploit it as they wish. According to data from the OpenSea platform, the transaction cost the group 120 units of the Ethereum cryptocurrency, just under 300 thousand euros. Carrefour’s director of digital transformation said that “events or product launches” could be organized on this virtual territory. The same choice was made by Warner Music and Coca Cola. The latter has even created a digital collection of its most iconic products.
– Buy houses
The functioning of the real estate market in the metaverse is based on the parcels of land made available by each platform. Users can therefore buy a plot of land and then build a property there. Just like in the real world, sales operations can be managed by actual real estate agents or brokers who operate in the metaverse: according to CNBC, currently around 12 companies globally are operating as real estate agents in the metaverse, but the number is continually growing. An example among all is Metaverse Property , which on its website defines itself as “the first company in the world for the virtual real estate sector”.
– Events planning
There are already numerous events – fashion shows, meetings, large conferences – that have taken place and are taking place on the Metaverse. Just to cite one example, in March 2022 Würth Italia announced that it had developed its own Metaverse to offer customers the opportunity to live an immersive experience by visiting the company’s numerous services and products. Wverse, Würth’s Metaverse created with Hevolus , is a virtual place in which it is possible to meet and accompany its customers to experiment with the different solutions offered by the company, active on the market since 1963 and currently a reference partner for 280,000 professionals in the world automotive, crafts, construction and industry. Within the Metaverse it will be possible to hold meetings, carry out training activities for customers and collaborators, interact remotely for the presentation of products and for sharing projects and systems.
Coderblock , an innovative SME from Palermo specialized in the creation of immersive virtual experiences, has created a first version of its metaverse. During the presentation, visitors to the Coderblock Metaverse had the opportunity to navigate with their avatar to discover the first virtual city among streets, offices, conference rooms, shops and shopping centers.
-Do training
The Metaverse is proving to be a valid tool for different types of training. For example , Terna , a company that manages approximately 75 thousand kilometers of high and very high voltage lines and approximately 900 stations throughout the national territory, uses technologies relating to the Metaverse for infrastructure development, maintenance and monitoring activities. Thanks to the technological evolution of gaming and the consequent maturity of the latest definition avatars, it is possible to reproduce realistic environments that help people both in their movements and in the recognition of objects, encouraging their training in complete safety. It is possible to access objects remotely, from the various territorial offices scattered across the country or even from smart working.
In July 2022 Philip Kotler , the father of modern marketing, chose Olimaint as a partner for the creation of the first business school in the Metaverse . The headquarters is part of a larger project which sees the debut in Italy of Kotler’s business school, which is called KCBS (Kotler-i Carboni Business School of Impact Marketing) and, founded together with Weevo, a Benefit company involved in digital marketing, has the aim of leading Italian companies towards sustainable and virtuous marketing.
There is also a startup that provides training in this innovative universe. Co-founded in Bari in 2019 by Nicola Bonerba and Katherina Ufnarovskaia, the Augmented.City startup launched an innovative project in some schools in the city in 2021: using the metaverse to motivate students, children and young people up to 14 years of age.
-Create experimental projects
At the beginning of 2022, Hyundai Motor Company unveiled its new concept of Metamobility , a portmanteau of Metaverse and mobility. After announcing Hyundai Mobility Adventure in September 2021 , a metaverse space where users can experience Hyundai Motor’s advanced products and mobility solutions of the future, the Group has decided to go deeper. He therefore decided to broaden the role of mobility to virtual reality (VR), ultimately allowing people to overcome the physical limits of movement in time and space .
BMW ran a six-month simulation building one-to-one scale virtual cars in the metaverse for its new electric vehicle production line before actually building the final layout for the factory. Over the course of those six months the design changed by almost 30% from the original. The German company did not publicly reveal how much more efficient it was, but said that about 30% of what they thought was the best factory in the world on the first day of the simulation had to change in the process. Indeed, why not practice first in the metaverse, where at low cost you can do things infinitely, even making what would be impossible in reality happen?
In fact, many designers are experimenting with new products and services in metaverse-type environments, to understand how they relate to the physical world, before making them collide with reality. During the pandemic, it was very useful to be able to have metaverse-style design rooms on the Internet, which everyone from clients to team members could access remotely and experience the quality of Zoom in 3-D. In short, with the metaverse people are empowered to do engineering design work in a highly productive way, without having to fly to each other.
Metaverse: what will the future be?
The metaverse aims to offer an ordered and rationalized version of the world, which is chaotic by nature. We are still in the early stages; the evolution of the metaverse will be disputed among tech giants over the next decade, or perhaps even longer. But today it is difficult to predict its developments and understand how much people’s preference for physical reality over virtual reality will have an impact on its concrete applications.
Brent Mittelstadt , a senior research fellow in data ethics at the Oxford Internet Institute, believes the potential social impact of the metaverse is far from certain. “If it became disruptive, for example by leading people to go on virtual dates rather than meet up, it would be very difficult to say what effect it would have on the nature of relationships, in the same way that it was difficult to predict the impact social media would have when it it just spoke as an idea.”
Mittelstadt sees the metaverse primarily as a way for Facebook to make more money. “If he can get you to spend a lot of time there, he’s achieving his goal of collecting more data and monetizing it. It would have more data sources than currently exist being combined and funneled through this thing that is the metaverse.”
It’s always difficult to make predictions when it comes to technology, and even the best can be wrong. As happened to Paul Krugman, economist, Nobel Prize winner and New York Times columnist, who in 1998 stated: “By 2005, it will become clear that the impact of the Internet on the economy will have been no greater than that of the fax.”
All that remains is to wait to see what fate will befall the metaverse that is arousing so much interest.
How much will the Metaverse be worth
A further topic of attention is the growth of the metaverse market expected for the next few years: BCG estimates a value between 250 and 400 billion dollars by 2025. The market is mainly composed of 4 elements: the economy of virtual assets, for where an increasing number of virtual assets will be created by individual users and traded between users and businesses (the transaction value for virtual assets, given their volatility, is expected to be between $150 and $300 billion by 2025); the augmented, virtual and mixed reality (AR/VR/MR) hardware and software market which, at almost 50 billion dollars, will be equally divided between consumer and enterprise buyers by 2025, demonstrating the productivity advantages resulting by the increase in AR/VR; finally, from the network and cloud infrastructure, and from the IT and communication infrastructures.
When the Metaverse will fully assert itself
A more marketing-oriented vision is the one released to McKinsey Digital by Matt Ball , one of the leading “metaverse” experts, investor and writer. “We will see two phases. First we’ll see more brands, more investment, more mergers and acquisitions, and more users in all things 3D and real-time rendering . These are trends that have been going on for several decades and there is no reason to believe that the time spent online, the number of smartphones in use and the criticality of digital to our economy will reverse. At the same time – adds Ball – we should expect some kind of backlash to the metaverse as a theme, as an investment case and as a point of shareholder priority, because the narrative, at least in my perspective, has surpassed the products and revenues we see now . Companies, of course, have to invest a lot before revenue and products arrive. Bill Gates has said he believes that in the next two to three years, most encounters will take place in the metaverse . The reality is that it will take a decade or more for this to happen.”
In reality, on May 5, 2022, the Prime Minister, Mario Draghi, and Mark Zuckerberg met at Palazzo Chigi and also talked about the metaverse. According to a Meta spokesperson: “In today’s meeting we confirmed our collaboration with the Italian government to enhance the country’s strengths in the technological and design sectors and identify future investments. Bringing the metaverse to life will require a joint effort between companies, politicians and civil society.”
Previously, Zuckerberg had also met, in Milan, some of the main CEOs of fashion and luxury, a sector that is focusing heavily on the metaverse, including Lorenzo Bertelli (Prada), Diego Della Valle (Tod’s), Renzo Rosso (OTB – Diesel), Brunello Cucinelli, Remo Ruffini (Moncler), Marco Gobetti (Ferragamo), Federico Marchetti and Geoffroy Lefebvre (YNAP – Yoox Net A Porter).
The concept of metaverse, however, is not new: the term was coined by the writer Neal Stephenson in 1992, in his science fiction novel Snow Crash , set in a near future in which the virtual world and the physical world are inextricably interconnected.
In Stephenson’s imagination, the metaverse is imagined as an immense black sphere of 65,536 km in circumference, cut in two at the equator by a road that can also be traveled on a monorail, which has 256 stations, each 256 km away. On this sphere each person can create whatever they want in 3D: shops, offices, public places and more, all of which can be visited by other users.
Facebook and the metaverse: first the enthusiasm, then 21.3 billion losses
Facebook has made building the metaverse one of its priorities, so much so that it has invested $50 million in funding non-profit groups to help “build the metaverse responsibly,” although it expresses the belief that this idea will take 10 -15 years to come true . When the Metaverse launched in 2021, it announced that it would hire 10,000 people in Europe to develop it.
In an interview that appeared in The Verge, the founder of Facebook described it as “ the successor to the mobile Internet “, a sort of “Internet incarnate, where instead of just viewing the content, you are inside it” .
A new team has been created at Facebook specifically dedicated to the development of the metaverse. The team is part of the virtual reality division Reality Labs , led by Andrew ‘Boz’ Bosworth , the author of the Oculus headset, and is made up of specialists from Instagram, Facebook Gaming (video games) and Oculus itself.
But in July 2023, Meta reported that its Reality Labs division, which develops virtual reality and augmented reality technologies needed to power the metaverse, posted an operating loss of $3.7 billion. The trend is constantly negative. The previous year, Meta’s Reality Labs unit lost a total of $13.7 billion, generating $2.16 billion in revenue, which is driven in part by the company’s sales of Quest-branded VR headsets. Reality Labs lost $3.99 billion during the first quarter. This brings its total losses to around $21.3 billion as of the start of 2022.
Metaverse and Venture Capital
The picture of venture capital investments in the Metaverse is photographed in the recent report “Vertical Snapshot: The Metaverse” by PitchBook. In the first half of 2022, the study finds over 12,000 investors and almost 10,000 deals, for a total raised of 115.5 billion dollars. The largest share of investments goes to North America, followed by Asia, with Europe in third place.
Which technologies for the Metaverse
The metaverse is at the center of Accenture’s Technology Vision , the annual study which aims to identify the most important technological trends that will characterize business in the coming years and which will represent the element of disruption in the technological development of companies. The new report claims that the “metaverse continuum” of digitally enhanced worlds, realities and business models is redefining how the world operates and interacts. According to the Accenture Technology Vision 2022 report “Let’s meet in the metaverse. The continuum between technology and experience that reshapes business,” companies are already moving towards a new way of operating, as technologies, including extended reality, blockchain, digital twin and edge computing , are converging to reshape human experiences. Accenture surveyed more than 4,600 business and technology leaders across 23 industries across 35 countries; 71% of executives believe the metaverse will have a positive impact on their organization and 42% believe it will be revolutionary or transformative.
The criticisms: the “security” risk and the question of resources
Not everyone is convinced of the validity, effectiveness and feasibility of a Metaverse world. For example , Frances Haugen , the former Facebook product manager who revealed in October that Facebook prioritizes profit over user safety and programs its algorithms to promote divisive content. Haugen is concerned about Meta’s ability to control what is published in the virtual world . In an interview with CBS you stated that the same problems you denounced could be repeated in the virtual reality of the metaverse. “Facebook didn’t actually think about security by design,” she said.
According to Haugen, platforms like TikTok, where a small portion of the content generates the majority of views, are easier to moderate than Facebook’s more distributed model. In virtual spaces where Meta is betting big, moderating content, removing misinformation and tracking violators will be a challenge, because interactions are not recorded.
Tony Fadell , the engineer who helped invent the iPhone, founded Nest and now runs an investment firm that has backed more than 200 startups, doesn’t mince his words in judging the metaverse, concerned that increased investment in this technology will defund climate-friendly technologies. “The metaverse is a false choice. It’s a resource diversion. You are either part of the problem or part of the solution. If you invest in the metaverse you are part of the problem,” Fadell argues.
What developments for virtual reality
A virtual reality, therefore. Something certainly not new. Its birth, in fact, dates back to the 1980s, by computer scientist Jaron Lanier , with his company VPL Research, an acronym for Virtual Programming Languages. More than thirty years later, however, virtual reality (VR) and augmented reality (AR) of any kind have not become as established as expected. Oculus VR , the virtual reality headset created by the company of the same name acquired by Facebook in 2014, has remained nothing more than a gadget, at least at a consumer level. Virtual reality seemed to be the techno-utopian future. But, as Paul Skallas , the author of the newsletter platform Substack, recently noted , “In 2000 they told you that virtual reality was about to explode, that it was going to change everything. It’s 2020: where is he?”.
Virtual reality – and together with AR – have come across a big obstacle: people’s habit of relating physically. Rather than in everyday life, therefore, VR and AR have become more established in industry.
Which companies are affected
Facebook has invested heavily in virtual reality through its Oculus headsets, making them cheaper than rivals, perhaps even making a loss according to some analysts. It is also creating VR apps for social and work, including apps that interact with the real world. In the intentions of the tech giant, however, the metaverse “will not be built overnight by a single company”.
What other companies might be interested? Epic Games, which produces Fortnite , a free-to-play multiplatform game, could be one of those. Online multiplayer games have been sharing interactive worlds for decades; they are not the metaverse, but they have several ideas in common. In recent years, Fortnite has expanded its product, hosting concerts, brand events and more within its digital world. This showed many what was possible with virtual reality and put the vision of the metaverse in the spotlight.
Other games are approaching a metaverse idea. Roblox , for example, is a platform for thousands of individual games connected to the larger ecosystem.
Unity , a 3D development platform, is investing in ” digital twins ,” digital copies of the real world, and graphics hardware company Nvidia is building its Omniverse , which is described as “a platform for connecting 3D virtual worlds.”
Dentsu Italia presented “dentsu gaming”, an integrated solution dedicated to the video game industry: from mobile to the metaverse.
Metaverse, not just video games
Is the metaverse just an evolved and sophisticated form of video game? No, although there are many different ideas about what it could be, most of them have human and social interaction at their core.
Still, Facebook has been experimenting with a VR meeting app called Workplace and a social space called Horizons , both of which use avatar systems. Facebook’s workplace of the future envisions virtual reality meetings where people use personal computers.
Another VR app, VRChat , is all about meeting online and chatting, with no focus or purpose other than exploring environments and meeting people.
More applications are just waiting to be discovered.
The CEO of Epic Games, Tim Sweeney, recently told the Washington Post that he imagines a future in which a car company, to advertise a new model, “will release its car into the digital world in real time and anyone will be able to drive it” .
Similarly, when we shop online we will try on the clothes in a digital, i.e. virtual, reality, before ordering the ones that will arrive in the real world.
It now seems clear that we are witnessing the birth of “metaverse marketing”, as Forbes magazine defined it.
Metaverse and training
The laboratory for the metaverse: Metaverse Marketing Lab
Inaugurated at the end of June 2022, Metaverse Marketing Lab is a project of the Polytechnic University of Milan with UPA and UNA (the associations representing advertisers and advertising agencies). It also makes use of the collaboration of Il Salotto di Milano and SimCoVR technology.
Led by Lucio Lamberti, Professor of Omnichannel Marketing Management at the Polytechnic, its objective is to raise awareness of the state of the art and track the evolution of the metaverse market, disseminate good practices and analyze consumer behavior in relation to reality experiences immersive, virtual and augmented.
Metaverse: The Accelerator
In June 2022, Metaverse 4 Finance Accelerator was born , the first Italian acceleration program – promoted by the Sella group and created by its Venture Incubator dpixel with the support of OGR Torino – which aims to identify and support the growth of national and international startups for the development of innovative, economically sustainable, inclusive and safe solutions and technologies, within the metaverse applied to finance.
