Recently, while announcing Facebook’s quarterly revenue, its chief executive officer (CEO) Mark Zuckerberg spoke about the company’s future goals. In particular, Zuckerberg expounded his aim to transform Facebook from a social media behemoth to a metaverse corporation. He characterised metaverse as the pinnacle of social technology, particularly after the onset of Covid-19 and the consequent lockdowns, which have prohibited individuals from interacting socially.

What is metaverse?

The term metaverse refers to the integration of physical reality, augmented reality (AR) and virtual reality (VR) in a single online area. It derives from digital antiquity and alludes to a fully developed digital world that exists beyond the one in which we live currently. The concept involves the internet evolving into a virtual environment and a 3D virtual living area. Broadly, the metaverse covers almost every type of old and new technology and digital concept imaginable, including VR, AR, computers, gaming consoles, social communities, phones and other mobile technologies. These new technologies, when combined, foreshadow what the internet will become in the future. This includes a number of virtual experiences, settings and assets, all of which gained traction during the online-everything transition due to the pandemic. The immersive virtual world built by the metaverse would allow individuals to spend time and socialise in a more realistic way.

Exploring the metaverse domain

At present, entrepreneurs, investors, futurists, and executives are all trying to stake their claim in the metaverse domain, expounding on its possibilities for social interaction, experimentation, entertainment and, most importantly, generating profit.

For instance, there is speculation that Apple is developing VR spectacles. Some firms have already begun to develop a metaverse architecture. To this end, Tim Sweeney, CEO of Epic Games (developers of the game Fortnite), has stated several times that the business is working on developing its side of the metaverse, with a blend of reality and virtuality. He believes that this is a place where individuals can get together to create, work and have fun.

Video games such as Roblox and Animal Crossing, alongside Fortnite, have been exploring the creation of metaverses to improve gameplay experiences. These games have large player bases, intricate environments and user-generated content. Similarly, Facebook’s Horizon, a virtual reality game with an integrated creation system in which people can create their worlds, also has metaverse tendencies. Microsoft has also discussed the concept of a “business metaverse”, while chipmaker Nvidia Corporation has its own version of the metaverse.

Facebook’s metavision

The two ideas in the new metaverse that best exemplify Zuckerberg’s vision are “teleportation” and “presence”. Both are concerned with where you can go and how you can get there.

Facebook has been working towards this goal for years, but has only recently begun using the word “metaverse” publicly to describe its efforts. In his pursuit of transforming Facebook into a metaverse company, Zuckerberg hopes to create a system in which individuals may travel between VR, AR and even 2D devices, utilising realistic avatars of themselves when appropriate.

According to Zuckerberg, metaverse has immense potential for individual innovators and artists, for people who want to live outside of today’s urban centres, and for people who live in places where opportunities for education or recreation are limited. A realised metaverse, in his opinion, could be the closest thing to a successful teleportation system. Zuckerberg also said that the virtual environment created by the metaverse would be accessible from any device or headgear, whether or not it is produced by Facebook. It would not be managed by a single business, but would rather be an “embodied internet”, as Zuckerberg described it, run by many different actors in a decentralised manner.

Significant headstart

Today, Facebook has a membership of over 3 billion people. If it ends up achieving its goal of creating a metaverse, the success will be colossal. Currently, Zuckerberg has a significant headstart in making this a reality, because he owns not just Facebook but also WhatsApp, Instagram, and VR gear maker Oculus. Collectively, these companies provide Facebook with an unparalleled amount of customer interaction, as well as all the crucial knowledge for constructing a desired virtual world, including how people behave online, their personalities, their likes and dislikes, their gaits, their eye movements, and even their emotions. This will help Facebook’s developers in creating immersive realism in the metaverse.

Further, Facebook is investing substantially in enhancing its connectivity as well as the technology and software expertise required to create a flawless virtual experience. AR and VR are other areas in which the social media giant has invested extensively. It has established a branch, called Reality Labs, whose researchers are focusing on developing the metaverse’s distinguishing features, particularly “presence”, the sensation of being in a space with people. This team, accounting for 20 per cent of the company’s staff, is largely staffed by persons with gaming backgrounds. Facebook is also investing in software to allow activities such as teleporting to another place, such as an office, to make it look as if you are truly there, as well as physical hardware such as AR glasses and more powerful VR headsets.

Zuckerberg predicts that this technological shift would be completed over the next five years, and headsets and AR glasses would be ready for substantial everyday use by the end of the decade. Further, Facebook aims to profit more from the sale of virtual products and experiences in the emerging new environment, which people will most likely engage with even more than they do now. This implies that the company will have even more income opportunities in the coming years.

Challenges galore

If Facebook wants its VR product to be successful, it will have to make it compatible with metaverse systems built by other firms online. It will also need to be scalable so that it can accommodate an increasing number of participants without causing any disruptions. These costly propositions may act as impediments, and it would first have to decide whether incorporating the technology is worth the expense.

Facebook has already been the target of an antitrust investigation for anti-competitive activities. Although the case was unsuccessful, the US is still working on legislation that may force Facebook and other internet behemoths to pull back. The business has many detractors, not least because of the Cambridge Analytica scandal, in which users’ data was reportedly stolen without their knowledge, and because of what it indicated about how Facebook has handled privacy. A thriving metaverse ecosystem would pose both familiar and unusual concerns about how the virtual realm is controlled, how its contents are regulated, and what its presence would do to the common sense of reality.

Users are still getting their minds around the two-dimensional version of social networks; managing a three-dimensional version might be much more difficult. With the awareness that the metaverse is not a novel concept, one must consider the major impediments to having a genuine sense of teleportation and presence. Moreover, while metaverses will unleash tremendous creativity and open up new opportunities and perspectives for companies, they will also be prohibitively expensive to develop. Professionals in the marketing, communications and branding space will confront new difficulties as well as possibilities while working in this domain. In addition, Facebook’s metaverse technology will become more valuable as more individuals join the network. This is predicated on the concept of network effects, a business model that has propelled Facebook and other American web behemoths to trillion-dollar valuations in the first place.

Facebook may also need to change its business model as a result of the creation of the metaverse, but doing so will not be an easy decision. This is because, with many of its consumers stranded at home for over a year as a result of Covid-19, Facebook has been witnessing tremendous growth. It just claimed a 57 per cent growth in the second quarter advertising sales, a 7 per cent increase in monthly active users (an addition of 170 million), and almost a doubling of its net income to $10.4 billion. At the moment, advertising is the cornerstone of Facebook’s social networking business model, but the firm’s transition to becoming a metaverse company opens the doors to additional revenue streams.

Net, net, establishing a virtual environment for people to engage with is not simply a fancy idea; it is a business requirement in the post-pandemic world. But Zuckerberg’s vision of building a Facebook for the VR world will be a difficult path to tread on.

By Anjali Kumbhar