What Is the Metaverse?

And why should businesses care?

10050

10/12/2021

Colin McMahon

 

In our recent podcast about the digital collaboration platform rooom, the word “metaverse” was thrown around several times. Understandably, this may have caused some confusion. Just what is the metaverse? Well, while the word is new, the concept is not. People have been dreaming of cyberspace since the 1980s and, in some ways, the metaverse is a continuation of this theme. When we hear tech evangelists discuss the metaverse today, what they are really talking about is user-driven interactions within virtual realities.

 

While much of the recent metaverse gains have come in the form of gaming and other entertainment content, businesses should not discount the concept too quickly. The metaverse is nothing less than a new form of communication, interaction, and collaboration—a place where literally anything can happen (provided it’s been coded).

 

 

What the Metaverse Means for Social Interaction  

For many, the metaverse (at least a primitive form of it) has already come. Tens of millions of fans have recently had the opportunity to see numerous live concerts in Fortnite, a free-for-all competitive game that seems to have decided to leave its genre and its boundaries behind to become a social platform. Famous historical events like Martin Luther King’s “I have a dream” speech have also been broadcast on the platform. But in reality, the beginnings of the metaverse have been providing new social opportunities for interaction long before Fortnite became a global gaming phenomenon.

 

Players have been meeting romantic partners and even getting married in massive multiplayer online games (e.g. Final Fantasy XIV) for years, and it only increased during the traditional social lockdowns of the COVID-19 pandemic. It is proof that the digital world has been slowly but consistently trickling into our physical one for some time now.

 

A user watches musician Travis Scott perform in Fortnite.
Source: NBC News

 

I bring up these gaming platforms to showcase an important truth of the metaverse: Form does not necessarily dictate function. Neither Final Fantasy nor Fortnite developed as these types of social experiences; they were built for something else. Nevertheless, they found success in their flexibility. By creating developed online digital spaces that allowed user interaction and a certain degree of freedom, both products took on new life and new significance to their users.

 

These days, the metaverse is more than just gaming. Social media platforms like Facebook, Instagram, Snapchat, and Twitter can all be considered early metaverses. These solutions were built with even less concrete direction than gaming software—there is no clear way to “win” Facebook (apart from maybe deleting it). Yet, people stay for the freedom to converse how they chose, be that about a shared passion, a political ideology, or even the hunt for collectable merchandise. And they are all things people choose to do, rather than are forced to do.

 

What the Metaverse Means for Marketing and Sales

The desire to interact is an important aspect of the metaverse and why it matters to businesses. If the user wants to be there, they will be more open to interact—including with sales and marketing. The Wall Street Journal reported that Facebook made $25.44 billion in advertising revenue in 2020 alone (again, helped along by conditions created by COVID-19).

 

But metaverses are making money in more creative ways than simple product links. As we’ve already written, the massively successful Animal Crossing: New Horizons is home to a whole slew of branded islands—locations users can visit to see and interact with new product announcements and displays. In these experiences, no direct salesperson is required. A designer constructs the location to showcase the brands’ appeal, then allows the user to wander and interact as they choose. It is passive but, as the entire location is the advertisement, it remains effective.

 

 

What the Metaverse Will Mean in the Future

I bring up Animal Crossing: New Horizons because I think it can be seen as a blueprint to how the future of the metaverse may look. For starters, there likely will not be just one metaverse. Think of the internet today: it is broken into pages. This is to help the user find what they’re looking for. The islands in Animal Crossing are akin to this—every user has an island, and this island can be used to express whatever they desire.

 

As new immersive technologies like virtual reality (VR) shape the modern metaverse, the spatial component is becoming more prominent. Users, administrators, marketers, companies…everyone needs to start thinking of the digital world as a 3D space. The metaverse has some depth to it now. We see this happening in early VR online communities. Each app is its own little world, a land of curated experiences where like-minded users can meet and perform a variety of tasks.

 

To bring us back to the beginning: rooom is looking to be part of the metaverse, a digitally constructed environment where all of the space is built around online business interactions—be it an event, a product display, a location tour. And while it can be accessed from a smartphone, there is little doubt that the programmers behind it envision the more immersive potential when VR headsets are more mainstream (at least in the business space).

 

And space really is a critical component. That is (in part) why investors are already looking into buying and leasing virtual space. Making the metaverse 3D and more immersive will, at least at first, tether it more to our world—if only so users can understand it. Where a company is and what their brand looks like in this digital space will matter. It will matter to consumers looking for their next product, and it will matter to how the competition views their image. Think of why companies shell out millions for downtown offices—it is the same status symbol.

 

The new metaverse is already taking shape in VR. Companies like Facebook are building new VR-first platforms with an aim of being a dominant player as interfaces transition. Google, Valve, Microsoft, and Apple are also in pursuit; each is trying to build creation tools to help build up the metaverse of tomorrow.

 

I know I may have lost readers by using video game references in a business-focused blog, but my point is this: The lines are blurring. Yes, I’m young, but I’m only getting older. There are two generations of digital-natives behind me, with more on the way. Video games have done a lot to inform and influence the rules of digital space (positively and negatively). Video games also represent a fine example of rapid evolution in the digital space. If you were to tell the makers of Fortnite when they put their game out that (years later) users could use it as a way to experience Martin Luther King’s “I have a dream” speech, they would not believe you. Nevertheless, here we are.

 

So, what is the metaverse? It is the next evolution in the internet. It is a new platform for everything from social interaction to point of purchase sales. It is an area of tremendous growth and investment. It is the future, but it is already here in many forms. What will change in the coming years is the level of immersion, the degree of complexity, and the variety of operations performed within this space. Companies should be aware of the metaverse—you’ll likely be doing business there one day, if you’re not already.

 

 

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