The Metaverse has become one of the biggest buzzwords in blockchain and crypto as it promises to provide a more immersive, interactive and collaborative experience than the internet has achieved to date.
This promise of a new world has huge companies like Meta (formerly known as Facebook) investing huge sums in the budding space. When most hear the name Metaverse, their minds wander to a few things: an avenue for global conglomerates to showcase their tech bent, an esoteric product for a select few to flaunt non-fungible tokens (NFTs), or a new front in development. games. However, a deep dive into Metaverse reveals a whole new world, one full of new opportunities and risks for consumers and businesses.
Although the current Metaverse ecosystem may be populated by giant corporations, eventually for wider adoption, smaller companies will need to make a transition. Looking at historical patterns in the adoption of new technologies like the internet, mobile payments and more, it is evident that small businesses are playing a monumental role in integrating the masses.
One of the key insights from Facebook Connect 2021 was that the advent of Metaverse is imminent, but the timeline for mainstream adoption spans at least a decade. A study by Pew Research found than about 54% of top tech innovators, developers and companies. Meanwhile, political leaders believe that by 2040, the metaverse will be a functional aspect of daily life for half a billion or more people around the world.
The urgency of transitioning to Metaverse may not be immediate, but companies should consider the technology at least at the edge. By strategically using resources now, a company will be able to improve the experience of customers in the future.
To understand the opportunities and risks that Metaverse brings to a business, it is imperative to understand the Metaverse infrastructure. Jon Radoff, CEO of 3D game company Beamable, categorized into seven layers:
- Infrastructure: This layer is made up of the semiconductors, materials science, cloud computing and telecommunications networks that allow the construction of the layers that cover it.
- Human interface: The human interface layer refers to the hardware that will be used to access the metaverse. This includes everything from mobile devices to VR headsets.
- Decentralization: Build everything on a permissionless, distributed, and democratized structure.
- Spatial Computing: This layer refers to the software that brings objects into 3D and allows the hardware interface to interact with them.
- Creator Economy: Make it easier to create Metaverse projects and monetize them for creators.
- Discovery: Ways of discovering the experience.
- Experience: Users can engage in games, social experiences, live music, and more.
In all likelihood, most small businesses will be involved in delivering Metaverse experiences to their customers. Speaking to Cointelegraph about the disruptive potential of Metaverse, Naveen Singh, co-founder and CEO of decentralized data management network Inery, said:
“There is no longer any question that the Metaverse will be a major disruption for the digital economy. The real focus now is on which industries the metaverse would be most important for. As the gateway to a new digital economy, the Metaverse opens up new possibilities in several areas.
“The industries most likely to undergo transformation and feel the immediate impact of the Metaverse are games, fashion, entertainment, media and retail. At the same time, for the Metaverse to unleash its full potential , one of the most defining properties would be interoperability across its fabric,” he said.
The metaverse is reshaping industries
The gaming industry has traditionally been a pioneer in adopting advanced technologies, and the same is true for the Metaverse. Many gamers already see Metaverse as the next frontier in gaming. Developers say today’s games can often feel lonely. Although multiplayer gaming solves the problem of isolation to some extent, Metaverse takes immersion and community to a whole new level. The communities created by Metaverse projects like Decentraland, Axie Infinity, and Sandbox offer not only social but also monetary benefits.
However, the current Metaverse gaming space is dominated by large corporations. Metaverse game research and development is usually out of budget for small businesses. Nikita Sachdev, founder and CEO of Luna PR, thinks that along with gaming, real estate is another sector that could potentially be an early adopter of the Metaverse. Sachdev told Cointelegraph:
“For real estate, companies and agencies are always looking to develop ways to visit and view properties for early sales and foreign investors. Imagine if you could visit an entire complex before it was even developed? Investing in real-world real estate will become much more immersive and “open houses” will no longer be necessary.”
The global real estate market is estimated at over $3 trillion, and any potential breach in this space can have immense economic and sociological implications.
Fashion is another sector that could be disrupted by the Metaverse. In fact, there has already been a success Metaverse Fashion Week which included parades, after-parties, immersive experiences, shopping, panel discussions and more.
Wahid Chammas, the co-founder of Faith Tribe – an open-source design platform – believes that since metaverse and fashion are ultimately about identity, they are bound to complement each other. Speaking to Cointelegraph, he said:
“People venture into the metaverse and do all kinds of things to live and portray an identity that they might not be living in the physical realm. Wearables are undoubtedly the most conducive to showcasing your personality and identity. As this link between the physical and the digital accentuates your perceived identity, we believe there will be further disruption of the physical and metaverse worlds of fashion for brands that take digital fashion seriously.
Risks associated with the metaverse
Exposure to Metaverse may present a higher risk for smaller businesses. The ecosystem is still taking shape and the uncertain and nascent character of the Metaverse could mislead the roadmap of some companies. Explaining on this point, Jake Fraser, Head of Business Development at Mogul Productions, told Cointelegraph:
“Technical expertise and know-how to virtually structure environments for users is a fluid space and requires people to have their finger on the pulse to execute the best user experience. There also needs to be value for the user and something unique that they can’t get from your brand elsewhere. Without a clear “hook” it can be difficult to drive business adoption. »
However, it is evident that venturing into the metaverse for affected businesses not only helps businesses be future-ready, but also makes their current offerings more lucrative. The benefits far outweigh the risks. Aurora42 CEO George Narita told Cointelegraph:
“The biggest risk is not getting into the world of the metaverse. I see a lot of opportunity, especially for early adopters, as was the case at the start of the dotcom era; many didn’t understand how to communicate. Simply being in the metaverse is not enough. Those who have a disruptive outlook and offer experiences and emotional connections by co-creating with their followers will be ahead. Today, people don’t want to be passive but to be part of the construction of this universe.