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Finding treasures and clues in underground tunnels and castles; fighting boss King Kong in a car race; mastering kung fu skills within several minutes; hanging out with avatars; and using math skills to save the world – these are not only scenes from sci-fi novels, movies and games, but also from a virtual universe called the metaverse.
Scientists and business executives are making efforts to build a metaverse, or “meta universe,” that combines the digital and simulated virtual worlds. It invokes imaginary creations like those from “The Matrix” (1999), OZ in “Summer Wars” (2009) and Oasis in “Ready Player One” (2018), even offering people a “second life.” The concept of metaverse became a buzzword in 2021, creating a meta market frenzy in stocks and spurring hopes of a boost in virtual realms that would unlock serious real-world dollars. “In the metaverse, you’ll be able to do almost anything you can imagine – get together with friends and family, work, learn, play, shop, create,” said Mark Zuckerberg, CEO of Facebook. The social media giant changed its name to Meta in 2021 to reflect its stance on the metaverse as “the next evolution of social connection.” Almost all tech giants, from Baidu and Microsoft to Nvidia and Tencent, are testing the waters on metaverse, although not so aggressively as Facebook.
The reason is simple: The metaverse is relying on technology development in chips, virtual reality and artificial intelligence to create and stimulate the virtual universe and offer users immersive experiences. Metaverse is one of the key sectors to boost tech spending in 2021 and into the future, covering blockchain, chip, cloud and game technology, said researcher Bain & Company.
“In the meta universe concept, there are surging demands for the cloud and chips, including both general purpose and AI dedicated chips,” said Cheng Xin, a partner at Bain. Omniverse, chip giant Nvidia’s metaverse tool, can “simulate the digital twins of warehouses, plants and factories, of physical and biological systems, the 5G edge, roboticss, self-driving cars and even avatars,” said Jensen Huang, Nvidia CEO. As well as being a buzzword, metaverse has created a stock frenzy in China. The domestic market prices of firms in the game, virtual reality, chip and cloud sectors jumped several times in 2021, especially after October when Facebook changed its name to Meta.
Here are some end-of-the-year predictions for metaverse. They include how it will change daily life, foster business opportunities and challenges and how far it is from the cyberpunk imagination. Of course it’s always a challenge to predict the future and even tech titans have divided opinions. For example, Tesla CEO Elon Musk said on Tuesday that metaverse was “more like a marketing buzzword right now than a reality.”
Will the metaverse influence our daily life in 2022?
It’s still too early to say the metaverse will influence normal people, as it has no universally acknowledged definition. People who spend a lot on virtual NFT (non-fungible token) products and avatar and items in games will probably be defined broadly as joining the meterverse. In business, training and remote work are expected to become early-bird fields for the metaverse, especially epidemic lockdown trips and meetings, according to research firm International Data Corp (IDC). With technology like facial recognition and AI-powered rendering, employees can cooperate and attend meeting in a simulated meta-office with simulated avatars, across regions and long distances, analysts said. Stock investors can access several waves of metaverse shares but in firms more related to concrete applications and business. Meta services will speed up convergence with 5G, blockchain, chips and components in 2022. They will create various meta-related business opportunities covering listed firms, said Pacific Securities.
What are the market opportunities for metaverse?
In the past decade, the cloud and AI have become two major growth engines in high tech, accounting for one-third of total investment. With new technology and rich capital reserves, industry giants like Alphabet (Google), Amazon, Apple, Meta (formally Facebook), Microsoft, Alibaba and Tencent will upgrade their products and services, also including metaverse services, according to Bain’s 2021 Technology Report. Besides Internet firms, VR hardware brands, mobile device vendors and chip firms have huge metaverse market potential, said researchers, including IDC. Startups have explored avatar or digital character creation for use in media, entertainment, finance and industry sectors. In December, startup Xiaoice, a 2020 spin-off from Microsoft, launched a digital avatar for use in AI news broadcasting. With neutral rendering technology, its avatars conveyed an overall naturalness to a level “indistinguishable from real humans.” The rendering training process needed less than a week compared with a previous several months, representing avatar technology maturity, Xiaoice said. Firms including SenseTime and NetEase have all launched avatar technology in China.
By November, 689 firms in China had applied for trademarks related to the metaverse, most of them making patent applications in 2021. In China, top firms like Alibaba and Tencent are expected to lead metaverse ecosystem construction, said Bain’s Cheng. Though in their initial stages, Alibaba, Baidu, Tencent, and TikTok have all launched metaverse products covering NFTs and avatars, Shanghai Daily learned.
Challenges and concerns for the metaverse
In films, the real world usually becomes a harsh place from which people flee to Oasis or OZ as their immersive virtual universes, leading to social problems and even threats to human existence. It’s still too early to worry about issues like “machine slave humans or Earth’s extinction” in 2022. But people should think about the cost and price of entry into the metaverse. Musk’s words seem to have some weight. People usually have to sacrifice their data and privacy to get “immersive and better experiences” in the metaverse. That is a reason for Facebook’s aggressive move as it faces stricter digital marketing regulations in the real world. Businesses should think about the other side of the metaverse which may bring challenges to so-called traditional industries.
James Liang, Trip.com Group’s chairman and co-founder, seems to dislike the metaverse. The leader of the country’s biggest travel platform warned of the risk of virtual travel replacing tourism and damaging the whole industry. He emphasized that real trips are an “irreplaceable experience” this year and in 2022.
Online fraud and other crimes are always challenges to new things like the metaverse. There are some “metaverse training” programs online, but the costs are high and they are often associated with the distribution and sale of cryptocurrencies. Such behavior is illegal on the Chinese mainland.