What opportunities and challenges does the metaverse offer now and in the future? In our new blog series, Karoliina Leisti from Stereoscape and Virpi Vaittinen from Loihde Factor will discuss the nature of the metaverse from different perspectives. In the introduction to the series, we will look at the underlying trends and technologies of the metaverse.
Digitalization, virtualization, the metaverse?
Digitalization affects almost everyone: it is a part of our everyday user experiences and plays an important role in the world of work. With the pandemic, individuals and companies have transitioned more quickly to using web-based functions, making new digital tools, platforms, and channels better known. Many business sectors have gone through major changes while some are still finding new approaches.
What is the next stage of digitalization? Can we speak of a virtualization process in which technological development and convergence (e.g., 5G, AI, AR, blockchains) creates a basis for the metaverse and Web3? Currently, there is an ongoing debate about the meaning of the metaverse and whether Web3 is the next big thing or a bubble. How can companies and consumers find the best opportunities and new business in the large and still unknown metaverse?
The metaverse: spaces and experiences
What do we actually mean by the metaverse? One way of defining the term is to understand the metaverse as a virtual and spatial dimension that is added to web-based channels and platforms, and as the enabling of cross-use of digital channels. The spatial dimension of the metaverse opens up entirely new, richer and more layered user experiences — whether it’s entertainment for consumers, training of astronauts, or virtual technologies for industrial purposes.
The gaming industry is a pioneer in the metaverse. With millions of daily users, games such as Roblox and Fortnite introduce an ever-increasing audience to virtual reality. In addition to games, the larger public became interested in virtual contents in 2021, especially with the introduction ofnon-fungible tokens (NFT)and unique virtual fashion garments. The technologies that enable the metaverse aren’t new, but it is only with the pandemic that developers, large companies, and investors have become convinced of the potential of virtualization on a larger scale. The most well-known example of this trend is probably the relaunch of Facebook as Meta last year.
The metaverse and Web3 represent slightly different visions of virtualization and the future of the internet. Web3 can be understood as a new era that will once again change the logic of how the internet is used. Web1 refers to an era of readable content during which information was converted into digital form. Web2, on the other hand, has been the era of social platforms during which personal data has been shared against services. Regarding Web3, there is speculation about whether data rights will be returned to the users themselves with the introduction of blockchain technology. However, the discussion around the metaverse doesn’t take a stand on the ownership of data, but rather the metaverse is seen as a platform and a vantage point for showcasing virtual assets. Virtual assets and NFTs are based on Web3 technologies that are partly the same technologies which are used to build and enable the metaverse.
What are the underlying technologies of the metaverse?
During the last years, the world’s largest technology companies from Apple to Microsoft, Google, and Meta (formerly Facebook) have made significant investments to both software platforms and physical equipment that will help bring digital and virtual worlds closer to people.
Extended Reality (XR) is an umbrella term which means extending the physical world by means of interactive digital elements. The term refers both to virtual reality (VR) and augmented reality (AR). In virtual reality, the user is cut off from the physical world when using a VR headset. In augmented reality, a digital element is overlaid onto the physical world, for instance, with a smart device such as a smartphone, and more often in the future, with smart glasses.
Mixed Reality (MR) refers to combining the virtual and physical worlds so that the user can also see physical elements through the virtual glasses, and the user of the glasses can interact both with the physical and digital objects and environments. All XR technologies are concerned with the same thing: blending the digital and physical worlds.
Companies, users, and technologies shape the possibilities of the metaverse together
What kinds of new experiences can we create in the metaverse? What new use cases can we find?
In recent years, different XR technologies have evolved vastly, enabling a better user experience and seamless transition between the physical and digital worlds. The pandemic has also accelerated the pace of virtualization. During the pandemic, XR technologies have been harnessed in both marketing and other corporate functions, as well as in the consumer sector. Currently, there is a vast number of VR and AR glasses for different purposes available on the market ranging from affordable options such as gaming glasses to ultra high-resolution glasses for industrial use.
The metaverse will not appear suddenly but rather take shape gradually and fragmentarily as existing platforms and applications develop. Simultaneously, as consumers get used to the terminal devices and platforms, they will become ready for new experiences. As with the previous developments of the internet, the arrival of the metaverse will disrupt the market and create new business opportunities.
The spatial experience will introduce a new dimension to the web, and this will require new thinking from both users and user experience designers. Companies must find a suitable approach for using the more experience-based, visual, and virtual internet in their business and learn how to reach their customers in this new environment. Consumers, on the other hand, will find their own channels and forums, and how they use the metaverse will shape it further.
Towards future business
Do you read a printed newspaper with the radio in the background? Or are you developing a new cryptocurrency based business model while listening to a podcast?
How we see and experience the world greatly depends on which generation we belong to. The differences between generations can be seen especially in how web-based platforms and applications are used and experienced. Boomers, Millennials, Generation Z and Generation Alpha all approach new technologies and the possibilities they offer differently.
As the internet becomes more virtual, the different generational experiences and the different eras of the web will coexist side by side. The entire internet won’t become a virtual reality, but rather the metaverse will be a channel and an experience among others.
As new technologies enter our daily lives at an ever-increasing pace, it can be difficult to see the full potential of virtualization. Agile leaders actively follow trends and become familiar with different platforms, technologies, and user experiences to better plan for future business. How are customer needs changing in the developing world? How do different companies find the best ways to take advantage of the opportunities that metaversum brings?
Curiosity and willingness to experiment will create new opportunities
You must be open to learning new things in order to see and understand the possibilities that come with the metaverse. Companies need an increasingly multidisciplinary approach because the metaverse brings together creative and experiential contents, user experience design, technical infrastructure and compatibility, back-end systems, terminal devices, and of course, knowledge of user needs. Creating a design and vision requires both creative and technical thinkers, customer knowledge, and business competence.
Users, consumers, businesses and technology companies gradually shape the metaverse. Currently, small steps are being taken towards an internet of spaces and experiences. Early adopters and companies will gain important experience through their experiments and contribute to the development of the metaverse. We are on the brink of something new.
In our next blog posts, we will explore the different possibilities of the metaverse in more depth.
10 tips for exploring the metaverse
- Curiosity will pay off. Those who move early will create new opportunities for themselves and learn from their experiences. Do you already know what your competition is planning in the metaverse?
- Explore practical examples. For instance, RTFK, which was recently bought by Nike, creates unique virtual sneakers for the metaverse.
- Experiment with Snapchat filters.
- Hold your next meeting in the metaverse!
- Make a virtual visit to the Louvre or the Museum of Contemporary Emotion.
- Explore different platforms in the metaverse. For instance, in the browser-based 3D virtual world Decentraland you can find the virtual “twin” of Sotheby’s auction.
- Explore the world of games. For example, Minecraft– Fortnite– and Roblox have millions of active daily users.
- Learn from the new generation. Digital natives see the possibilities of the metaverse differently than older generations.
- Experience the virtual and augmented realities. Book a Stereoscape demo: [email protected]
- Find out more about metaverse trends. Book an appointment with Loihde Factor: [email protected]