The metaverse as a concept came into prominence when Facebook’s parent company, Meta, started exploring it. It allows for virtual interactions in a three-dimensional world, often replicating the real one. These include virtual hangouts, meet-ups and live updates on day-to-day activities. It is often seen as intimately tied to virtual reality (VR) devices and avatars.
The virtual world simulation in the metaverse requires a high degree of computation and operations. Therefore, mobile gaming has been the most common use case for the metaverse in the mobile phone industry. Users can choose to create an avatar and live a second life in a parallel but virtual world. While some apps have completely shifted to the metaverse, others have opted to partially upgrade to the metaverse to include elements such as avatars and cryptocurrencies.
Meta has been leading the metaverse space with its app, Horizon Worlds. Launched in December 2021, the application hit 3 million users in February 2022, with over a billion virtual worlds created by these users. The application works on the VR headsets Oculus Quest and Oculus Quest 2. The user has the option to play in standing, sitting or room-scale modes.
Horizon Worlds can be used to attend music concerts, sports events or community-hosted events without having to physically go to the place. The application allows the user to play games either alone or in two-player mode.
Many other platforms have also experimented with metaverse gaming, such as Roblox, which has been in the gaming industry for the last 15 years. Roblox allows creators to make virtual worlds where others can play and make money. The platform has partnered with brands such as Nike and Forever 21, allowing fashion brands to market to a wider, experimenting audience. These fashion brands have their own virtual words on the metaverse platform.
Another platform, Zepeto, allows users to create their own avatars. Zepeto reportedly has influencers who are earning in six figures while playing on the platform. Users can create virtual items on the platform and sell them to earn currencies called “zems”, which can then be converted into real money. The platform was launched three years ago and has already recorded 250 million users.
Similar to zems, Sandbox also uses its own currency, which can be converted into real money. Using the real estate metaverse platform created by Sandbox, users can create plots of land and sell them to other users. The money earned can then be converted into non-fungible tokens through the Ethereum blockchain.
Another app, The Sims, has been active in the gaming industry for the past two decades. It allows the gamer to create a parallel universe, dress their avatar from scratch and even create their own family.
Microsoft’s Minecraft also allows users to create virtual worlds purely out of their own imagination. However, while the metaverse journeys of Meta and other platforms focus more on gaming and entertainment, Microsoft has also adopted a slightly different strategy.
For its online collaboration platform, Teams, Microsoft has introduced Mesh, which will allow workplaces to see employees interact in a virtual environment. Users can choose to have avatars that mimic lip movements and head shakes. They can also join a digital environment to perform virtual functions such as ideating on a virtual whiteboard or discussing a campaign strategy in a meeting room. This can allow new employees who joined during the pandemic to have the immersive experience of wo-rking from office. Mesh offers a broad range of avatar personalities to choose from. The simulation can be experienced via a laptop or a VR headset, including the Microsoft-crafted VR headset, HoloLens. The platform can handle big conferences and even large-scale events.
On a similar note, Microsoft recently programmed a metaverse-based interaction for new Accenture employees.
Integrating the metaverse with the workspace will enhance interaction between employees. It will also help upskill the workforce. Renault, for instance, has used augmented reality to train battery technicians. This, in the longer run, will make up for the shortage of employees and help retain those who wish to work from remote locations.
In the field of education, the metaverse has allowed the curriculum to be delivered to students in different corners of the globe. The Kenya-KAIST virtual centre, located 60 km from Nairobi, is planning to extend its courses to students across the globe.
In the healthcare industry, the metaverse is helping both enterprises and patients alike. Swiss American multinational pharmaceutical company Novartis, on the other hand, is imparting lab skills to its employees using a multiplayer VR simulation. US-based Starlight Children’s Foundation is capitalising on VR technology to help paediatric patients go beyond the walls of the hospital and spend time playing sports or hanging out with loved ones.
In the defence sector, Accenture is helping the sector in various capacities, such as by retaining talent, and aiding in command and control as well as procurement cycles.
Future growth trends
A Fortune Business Insights report says that the global metaverse market is expected to grow from $100.27 billion in 2022 to $1,527.55 billion by the year 2029, which translates to 47.6 per cent growth during the period. The Covid-19 pandemic has also helped hasten the growth and increase the market size of the industry. The industry grew by 3.3 per cent in 2020 as against 2.6 per cent in the previous year.
The same report has also found that, among devices, desktops are used the most to engage with metaverse content. Meanwhile, in terms of applications, it is used the most in the e-commerce industry.
The rising demand for VR devices from both enterprises and consumers has fuelled market growth for the metaverse industry. With the growing adoption of artificial intelligence, blockchain and mixed reality, the market size of the industry is also increasing.
The crypto industry is also helping the metaverse market size improve significantly. Metaverse gaming platform Decentraland, for instance, raised $ 1.2 billion through the Ethereum blockchain using blockchain and mixed reality technology.
The United Nations Conference on Trade and Development report finds that e-commerce sales grew from 16 per cent to 19 per cent in 2020. The e-commerce industry can be a big opportunity for the metaverse industry. Enhancing customer satisfaction through metaverse services such as virtual apparel trials, 3D demos of home appliances and virtual visits to stores can help increase sales.
However, despite these drivers, there still exist a number of factors that are hindering the industry’s growth. The metaverse industry still needs to ensure that enterprises are aware of its scope for enhancing the growth of each sector. There is also a greater need to protect the industry from security attacks, given that the crypto currency industry is also partnering with metaverse platforms. Financial frauds must be avoided to make sure that enterprises and consumers are safe.
Moreover, the industry is yet to fully gain traction in certain regions of the globe, such as Asia Pacific, the Middle East and Africa, and Latin America. Its growth in these regions is still considered moderate, compared to regions such as North America and the European region.
However, the biggest hurdle is legitimising the industry. Not all governments have recognised the cryptocurrency and metaverse industry as legitimate, and thus lack proper regulation for safeguarding the interests of all parties involved in it.