The New Challenge: Metaverse Economy
Technology has grown at a breakneck pace in the last decade, and we should expect even more in the coming decade. — Vinod Johri
The world is transforming too fast so the challenges are growing multi-dimensional. The technology is surpassing all economic models, principles, rules, standards and recognitions. Technology has grown at a breakneck pace in the last decade, and we should expect even more in the coming decade. Yes, I am talking about Metaverse virtual world reshaping economy. This is the next generation of internet, say Web 3.0 for Gen Z and millennials. The metaverse is not a new idea. Science fiction writer Neal Stephenson coined the term in 1992, and the concept is commonplace among video game companies. The connections between the financial, virtual, and physical worlds have become increasingly linked. For decades, massively multiplayer online games have served as digital worlds where people can meet, chat and do business. The metaverse is a concept of a persistent, online, 3D universe that combines multiple different virtual spaces.
The metaverse is a network of interconnected virtual worlds that may be accessed through a variety of devices such as virtual reality headsets, augmented reality systems, cell phones, and PCs. Key principles of the metaverse include decentralisation, interconnection and inter-operation, safety and trust. Virtual avatars congregate to work, pursue hobbies, shop, play, or otherwise interact in online communities and explore the digital area in the metaverse, which is an immersive, digital equivalent to the physical world. It’s a simulated digital environment that incorporates various technologies and social media concepts to create areas for rich user interaction that mirror the actual world. Metaverses are powered by blockchain technology.
Virtual reality (VR) and augmented reality (AR), will be key technologies being used in bringing the metaverse to life. Virtual reality or augmented reality could be used in the metaverse to immerse users in an alternate world. That technology, on the other hand, is still being developed. The possibilities of a virtual world where everything is backed by lines of code could open up new revenue streams for businesses who enter this new market. It’s only a matter of time before the metaverse becomes a reality, given the speed with which technologies and businesses are developing creative ideas surrounding immersive reality.
We need to sensitise about the new technology when it has already matured, widely accepted and starts posing as potent challenge. Newest technologies have to be cautiously accepted, adopted and followed lest we go obsolete and redundant. The best of Government policies on self-reliance, Atmanirbhar Bharat, swadeshi and social welfare face stiff challenges of latest technology and mandate quick remedies to adopt what is beneficial for the country and guard against evil effects as we did to cryptocurrency.
The future of the metaverse depends on digital infrastructure. While we may argue that the metaverse will have an impact on the digital ecosystem, the digital ecosystem is a key component in making the ecosystem metaverse ready. Digital infrastructure that brings data, technology, ideas and creating experiences will help consumers enjoy metaverse. The metaverse is here to stay, and it will revolutionise how people interact with the digital world. It will be more of an experience in terms of content and video consumption. The complete customer journey will take place in the metaverse, from the perspective of brands and customers. With metaverse on the horizon, brands and consumers will be able to collaborate to produce content for a better experience.
Exposure to Business
A digital ecosystem is a collection of networked information technology resources that can work together to form a single entity. Suppliers, customers, trading partners, applications, third-party data service providers, and all related technologies make up digital ecosystems. The ecosystem’s success depends on interoperability. The giant companies like Apple, Google, Microsoft and Meta are exploring similar technologies. For some, they might be a way of selling software and services. For others, they might be a way of selling ads.
Market share leaders commonly establish and dominate digital ecosystems; the approach has Keiretsu roots(Japanese term for business network made up of different companies, including manufacturers, supply chain partners, distributors and financiers) and is rapidly impacting transformation in a variety of industries, including consumer goods, automobiles, and healthcare. An ecosystem helps an organisation to control new and old technologies, establish automated processes around them, and constantly grow their business by integrating business-to-business (B2B) practises, enterprise applications, and data.
The activities that currently take place in siloed environments will eventually take place in a single Metaverse, such as:
- Purchasing outfits and accessories for online avatars
- Buying digital land and constructing virtual homes
- Participating in a virtual social experience
- Shopping in virtual malls via immersive commerce
- Using virtual classrooms to experience immersive learning
- Buying digital art, collectibles and assets (NFTs)
- Interacting with digital humans for onboarding employees, customer service, sales and other business interactions
Opportunities across multiple industries include:
- Higher education, medical, military and other types of trades can deliver a more immersive learning experience. They don’t need to create their own infrastructure, as the Metaverse will provide the framework.
- Virtual events, having gained popularity over the last two years, can now present more integrated offerings.
- Retail can extend its reach to an immersive shopping experience that allows for more complex products.
- Enterprises can achieve better engagement, collaboration and connection with their employees through virtually augmented workspaces.
- Social media can move to the Metaverse, where users can interact through three-dimensional avatars.
- Virtual tourism is another use case for the metaverse. Technology has advanced to the point where you can enjoy travel without physically visiting your destination.
People who have no interest in the metaverse but see it as a financially lucrative realm could invest in the stocks of the companies developing it. The future metaverse is based on the idea of running openly, nearly without interruption from a single community or company, since creators from all over the world would participate.
According to an analysis by Bloomberg and data from Newzoo, IDC, PwC, Statista, and Two Circles, the potential worldwide revenue from metaverse technologies could approach $800 billion in 2024, up from about $500 billion in 2020. Online games and gaming equipment manufacturers may account for over $400 billion of this market in 2024, with the remainder in live entertainment and social media capabilities.
When trillions of dollars have already been invested in Metaverse, biggest Global Corporates have explored forays into Metaverse world, it is imperative to wake up and catalyse our thought process to get into the new reality. The Government needs to sensitize policy makers to evaluate impact of metaverse economy in national perspective while making its best use in education, tourism, digital currency, creation of jobs and reaching masses to sensitize on environment. Opportunities are immense and we have to tap metaverse technology to the highest advantage to our economy and governance.
The author is Sah Vichar Vibhag Pramukh, Swadeshi Jagran Manch, Delhi Prant