The Metaverse is the digital world’s Next big promise. It is being viewed as a parallel “3D virtual universe” where every human being can have an avatar to identify themselves. These animated avatars could be used to virtually do all real-world activities, including shopping, gaming, and traveling. They can also own and sell real estate. Some tech-savvy couples have held their wedding and reception parties in Metaverse. This is so cool!
A Metaverse is a virtual space that has been created through the convergence of digital and physical reality. Gartner defines it as a collective virtual shared place. A Metaverse is a collective virtual shared space created by the convergence of virtually enhanced physical and digital reality.
The majority of people around the world are still trying to understand Metaverse and its implications. However, pioneers such as Meta (the company), Fortnite(the game), Somnium Space (“a VR world builder”), and IMVU (“an avatar-based 3D social networking platform”) have helped to increase the Metaverse market to approximately $47bn. This is a mind-numbingly colossal growth rate of 160% in the next 2 years.
The building blocks of the metaverse — What makes up this developing magical world?
Let’s take a look at each one of these building blocks.
Augmented reality AR: Pokemon go showed us the beauty and power of augmented reality a few years ago. Many brands such as Ikea and others have since demonstrated how augmented reality can be used to help customers visualize product placements in their homes before they buy them. AR will be an active part of the Metaverse. It will allow for low-cost visualizations of expensive assets and enable virtual try-on (of jewelry, make-up, and shoes). For immersive gamification, enhanced quality assurance, and more,
Mike’s story is an example of “AR at work”. His dad scanning the virtual pizza banner within the game to purchase Mike’s real-world pizzas is an excellent example of this. The AR market is growing rapidly, consistent with the larger Metaverse phenomenon. It is expected to reach $88.4bn by 2026, up from $14.7bn in 2020.
Virtual reality: Virtual Reality is the creation of a virtual environment using computer technology. Virtual reality is immersive and interactive, allowing the audience to participate in the experience. Virtual reality allows the participant to move around in a way that is similar to what he/she would do in real life. Virtual reality applications saw an explosion in popularity during the pandemic. There were virtual conferences, virtual exhibitions, and virtual training. Interactive virtual tours also gained traction. The demand for VR has increased tremendously and Mike’s VR headsets were a major factor in his immersive VR experience. The market for virtual reality headsets is expected to grow to USD19 billion by 2026. 8 Billion by 2026 from USD 6.8 billion in 2020 at a CAGR of 19.5 strong>
Artificial Intelligence (AI): AI is a key component in digitalization across all industries — whether it’s retail, manufacturing, healthcare, or any other. Machine learning, deep learning, and business intelligence are all possible with AI. AI-powered chatbots can provide insights and analysis that will benefit enterprises. AI is a key component of the Metaverse. AIOps on an infrastructure plane enable blockchain-driven smart contracts to power data-driven immersive experiences across multiple digital interfaces. AI is an integral cog in the Metaverse. From AIOps at an infrastructural plane, enabling blockchain-driven smart contracts to power data-driven immersive experiences across various digital interfaces, to hyper-personalizing experiences at the top, AI is a vital cog in the wheel of the Metaverse.
Non-fungible Tokens (NFT), NFTs: NFTs tokens can be used to signify ownership of unique items. Numerous celebrities, including Eva Longoria and Serena Williams, have used NFTs, such as Reese Witherspoon and Serena Williams. NFT profile photos have been used on Twitter by many celebrities, including Reese Witherspoon, Eva Longoria, and Serena Williams. Creators can use NFTs to tokenize items such as art, collectibles, and real estate. It’s not fungible means that it can’t be duplicated. Currency, for example, is fungible. You can exchange one $100 note with another. However, NFTs can only be purchased directly from their creators and are unique in that they are not available for purchase. It has the unique aura of being rare and valuable. Creators can make money without the need for an intermediary by selling NFTs. Mike and his friends can share their creations as NFTs, and they can even sell and buy them with bitcoins. The global non-fungible token (NFT) market value reached USD 340.0 million in 2020. It is expected to grow at a rapid rate of revenue CAGR over the next few years.
Blockchain services: While Metaverse will allow you to buy and sell real currencies, it would seem that blockchain would make this transaction much easier, more transparent, secure, and disintermediated. Blockchain will be the foundation of Decentralized Apps and Decentralized Autonomous Organizations (DAO).
3D modeling: 3D modeling is the mathematical representation of an object’s surface in three dimensions using advanced software. The Metaverse has a number of avatars that will represent every human entity. Virtual exhibitions, virtual events, and shows are becoming more prominent use cases. This means a growing demand for 3D artists in all industries. The good 3D design is what Mike created a motivating and pleasing avatar for his video game. The HTML3D modeling and mapping market was valued at USD 3.64 billion in 2020. It is expected to grow to USD 13.15 billion by 2028.
Design, development, and commercialization of games: There are more than 2.7 billion gamers worldwide, and 48% of companies work on AR/VR gaming. The estimated market size for the gaming industry is around $200bn globally. It is expected to grow at a 13.2% CAGR by 2028 to $545.88.
Epic Games and Roblox are pioneers in the creation of metaverses. These virtual worlds allow millions to interact, play and participate in an experiential economy. Pro-gamers can even make a living selling their digital collectibles within these Metaverses. Companies like Roblox hosted their holiday parties in Metaverses, while Fortnite treated its fans to a Travis Scott concert.
Metaverse combines the experience economy
Metaverse’s greatest asset is its ability to bring together different dimensions of the “Experience Economy”. The right infrastructure and intelligent interfaces can make the experience possible. This allows for decentralized data to be closer to devices, while also allowing for immersive experiences to be consumed. It encourages the creator community to create and publish new pieces of work as NFTs. These are unique experiences that, when combined with multifaceted marketing, result in unimaginable experiences. These experiences produce large amounts of data which are fed back into the loop to create an experience economy. This loop is illustrated in the below illustration.
Metaverse is a service (MaaS), that’s already taking off
This whole decentralized, permissionless, semantic web-oriented, AR/VR/XR/MR/AI-driven, hyper-connected, and ubiquitous nature of the Metaverse opens it to a myriad of business uses across industries. This industry’s potential is compelling technology leaders such as Meta, Google, and Nissan to invest in it. Many IT companies are also compelled to package this service so they can create metaverses for clients. In the next three to four years, the industry will grow 16 times. As always, the early movers will get the best of it. What would a metaverse service catalog look like? Each building block, as we have seen in the article, will contain a multitude of services. Each of these service areas is extensive in nature. Possibly, the next blogs will take a deeper dive into just a few. The fact is that the ever-growing Metaverse catalog must be offered “as a Service” to maximize the potential revenue. Let’s look at a sample Metaverse catalog that includes a range of services that could be added over the next few years.
Security in Metaverse will be the key to its growth
Metaverse is still in its genesis phase, and concerns are already being raised about security loopholes that could limit its utility. Avatar Impersonation is a potential method of identity theft in the Metaverse. This means that an unwelcome element could hack into the Metaverse and alter the avatars to their advantage. Experts are looking at integrating biometrics into the hardware to detect and record an individual’s iris and associate it with their avatar in order to combat such social engineering.
Invisible avatar eavesdropping, another security vulnerability that is emerging, allows disruptive elements to invisibly join meetings and listen into conversations. Facebook recently introduced the “personal boundary” tool after users complained about sexual harassment in the Metaverse. This allows users to feel that they are nearly four feet apart from their virtual avatars when they use the Horizon Worlds or Horizon Venues apps via VR headsets.
Cyber security experts are crucial in identifying potential security threats to the metaverse and creating mitigation strategies to ensure that it remains secure.
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