Time Magazine Special Report | The Metaverse Will Reshape Our Lives, and We Must Ensure It Becomes Better

Original Title: 《The Metaverse Will Reshape Our Lives. Let's Make Sure It's for the Better》
Author: Matthew Ball, Managing Partner at Epyllion, Partner at Makers Fund
Translation: Amber, ForesightNews

Matthew Ball is the managing partner of early-stage venture fund Epyllion and a venture partner at Makers Fund, as well as the author of "Metaverse."

A report from the U.S. Securities and Exchange Commission noted that the term "metaverse" appeared in regulatory filings more than 1,100 times in the first six months of 2022. A year earlier, that number was just 260 times, and if we look back further, the term had appeared less than ten times in the past twenty years. The concept of the metaverse is being mentioned more frequently, yet it seems that few can clearly explain what it actually is or what they intend to build. Even among corporate executives who frequently mention the metaverse, there appears to be significant disagreement on the matter, including debates over VR headsets, blockchain, and cryptocurrencies, as well as when the metaverse will actually arrive.

Of course, these debates have not deterred capital from flooding into this hot reconstruction. Many stories have circulated about Facebook rebranding itself as "Meta" and its current annual losses exceeding $10 billion on metaverse initiatives. However, the other six largest publicly traded companies in the world—Amazon, Apple, Google, Microsoft, Nvidia, and Tencent—are also busy preparing for the metaverse. They are restructuring internally, rewriting job descriptions, rebuilding their products, and preparing to launch offerings worth billions of dollars. In January of this year, Microsoft announced the largest acquisition in tech history, paying $75 billion for gaming giant Activision Blizzard, which will "pave the way for exploration in the direction of the metaverse." According to McKinsey, in the first five months of this year, companies, private equity firms, and venture capitalists collectively made metaverse-related investments totaling up to $120 billion.

So far, almost all of this work is invisible to the average person. It’s like the "interstellar" itself. We don’t have any metaverse products that we can actually purchase, nor do we find "metaverse revenue" on profit and loss statements. In fact, in terms of its existence, it seems to have come and gone. The cryptocurrency market has collapsed. So has Facebook's market value, which was $900 billion when the company rebranded as Meta, but is now around $445 billion. This year, video game sales have dropped nearly 10%, partly due to the end of the COVID pandemic forcing many people out of their homes.

For many, the apparent setback in the development of the metaverse concept seems like a good thing. These tech giants have already exerted tremendous influence over our lives and the technological and business models of the modern economy. Given that today’s internet has many issues, why not resolve these problems before entering what Mark Zuckerberg calls the "next generation of the internet"?

The answer is embedded in the question itself. The metaverse, a concept that has existed for 30 years but has actually been in the human mind for a century, is gradually taking shape around us. Every few decades, there is a platform shift—such as the transition from mainframes to PCs and the internet, or the subsequent evolution to mobile internet and cloud computing. Once a new era is formed, it is difficult to disrupt who leads it and how. But in the interim between two eras, these things often change. If we want to build a better future, we must actively shape it, just like those who invest in building it.

So, what does this future look like? Imagine the metaverse as a parallel plane of virtual existence that spans all digital technologies and even controls much of the physical world. This structure helps explain another common description of the metaverse as a 3D internet, and why building it is so difficult, yet still worthwhile.

The internet as we know it today spans nearly every country, 40,000 networks, millions of applications, over 100 million servers, nearly 2 billion websites, and hundreds of billions of devices. Each of these technologies can connect and consistently exchange information, allowing people to find each other "online," share online account systems and files (a JPEG, an MP4, a piece of text), and link to one another (think of how a news publisher links to another media report). Nearly 20% of the world economy is considered "digital," and most of the remaining 80% of the economy operates on the internet's foundation.

Despite the internet being resilient, widespread, and powerful, it was not built for immersive interactive experiences involving a large number of participants—especially when it comes to three-dimensional imaging. Instead, the internet was primarily designed to allow a static file (like an email or spreadsheet) to be copied and sent from one device to another, so it could be reviewed or modified independently and asynchronously. This is part of why even in an era of "streaming wars" and tech giants worth trillions of dollars, simple two-person video calls remain so unreliable. (Additionally, there is no consensus on file formats or conventions for three-dimensional information, and no standard systems to exchange data from virtual worlds. We also lack the computing power to realize the metaverse we envision. We will need many new devices to achieve it—not just VR headsets, but also holographic displays, ultrasonic field generators, and devices that sound strange, like those that capture electrical signals passing through muscles.)

We cannot know in advance how important a 3D internet might be for our global economy, just as we did not know the value of the internet. But we do have some insights into the answers. With improvements in internet connectivity and computer processors, we have transitioned from single text to web pages and blogs, then to online profiles (like Facebook pages) and video-based social networks, emojis, and information streams. The amount of content we generate online has evolved from a few posts on message boards, emails, or blog updates each week to multimedia content that encompasses the details of our lives. The next evolution of this trend seems to be a persistent, "living" virtual world that is not just a simple record of our lives (like Instagram) or a tool for communication (like Gmail), but one in which we also exist, and in 3D form (hence the focus on immersive VR headsets and avatars).

Currently, nearly 100 million people log into Roblox, Minecraft, and Fortnite Creative every day, platforms that operate millions of interconnected worlds, supporting consistent virtual identities, virtual goods, communication suites, and accessible from most devices. Much of the time spent on these platforms is for leisure—playing games, attending concerts—but we are starting to see people making more attempts and explorations.

Electric Daisy Carnival was the first music festival in Roblox, held in October 2021

Education is a classic use case that we have long hoped would be transformed by the digital age, but so far, there has been little substantial progress. Since 1983, the cost of higher education has increased by more than 1,200%; during the same period, the cost of healthcare and services in the U.S., which ranks second, has only increased by half as much as education. The challenge we face is that the resources needed for real things are not less than they were decades ago, and when transferred to a remote computer screen, we lose the interpersonal communication and hands-on experience of experiments, which are absolutely not replaceable by YouTube videos.

In the metaverse, magical classrooms become possible. For decades, students have learned about gravity by watching their teacher drop a feather and a hammer, then seeing a video of Apollo 15 commander David Scott doing the same on the moon. Such demonstrations need not disappear but can be replaced by creating carefully designed virtual Rube Goldberg machines, where students can test under gravity similar to Earth’s, on Mars, or even in the sulfur rain of Venus's upper atmosphere. Instead of dissecting a frog, we could travel through the frog's circulatory system, which is different from how we drive in Mario Kart through the Mushroom Kingdom. And all of this would be available anytime, anywhere, without the limitations of geography or local school resources.

In 2021, neurosurgeons at Johns Hopkins University performed the hospital's first remote surgery using augmented reality headsets, providing surgeons with an interactive display of the patient's internal anatomy. Dr. Timothy Weah, who performed the surgery and is also the head of the hospital's spinal fusion lab, likened it to having GPS. This reference frame is important. We often think of the metaverse as replacing what we do today—like wearing a VR headset instead of using a smartphone or watching TV—but we are not replacing cars with GPS; we are using GPS to drive cars.

Earlier in 2021, Google released its Project Starline device, which uses machine learning, computer vision, a dozen depth sensors and cameras, and fabric-based multi-layer light field displays to create 3D holographic video without the need for dedicated mixed reality glasses. Compared to traditional 2D video calls, Google stated that its Starline technology resulted in a 15% increase in eye contact, a 25-50% increase in non-verbal forms of communication (gestures, nods, eyebrow movements), and a 30% improvement in memory of conversations. Few of us enjoy Zoom; perhaps some of our discomfort could be alleviated by adding another dimension.

Infrastructure is another good example. Hong Kong International Airport now operates a real-time digital guidance facility that allows airport operators to determine where passengers and planes should be directed using real-time 3D simulations. Billion-dollar urban projects that have taken decades are using these technologies to determine how a building might impact traffic flow and emergency response times, or how its design will affect the temperature and sunlight in local parks on specific dates. Most of these are unrelated simulations. The next step is to bring them online—just like transitioning from offline Microsoft Word documents to cloud-based collaborative documents—and turn the world into a large digital development platform.

However, the lack of precise explanations about what the metaverse means for society as a whole is precisely where some skepticism arises. People see billions of dollars being poured into a place that looks like a game, which is hard to accept. However, we can actually view the metaverse as the fourth era of computing and networking—the first three being mainframes from the 1950s to the 1970s; personal computers and the internet from the 1980s to the mid-2000s; and the mobile internet and cloud era we are experiencing today. Each era has changed who, when, where, why, and how people access computing and networking resources. The impacts of these changes are profound, but they are also difficult to predict concretely.

Even the biggest proponents of the mobile internet struggled to predict anything beyond "more people, more frequent internet access, more reasons." A deep technical understanding of digital networks does not illuminate the future, nor does deploying billions in R&D funding. Services like Facebook, Netflix, or Amazon's AWS cloud computing platform seem obvious in hindsight, but in their early days, their business models, technologies, design principles, and more were difficult to "accept." In this regard, we should recognize that chaos, confusion, and uncertainty are prerequisites for disruption to occur.

Moreover, there are still some specific questions that can be clarified. The metaverse is often mistakenly described as immersive virtual reality headsets, like Meta Quest (Oculus VR), or augmented reality glasses, with the most famous example being Google's smart glasses. VR and AR devices may become the preferred way to access the metaverse, but they are not the metaverse itself. Consider that smartphones are not the same as the mobile internet. The metaverse is also not Roblox, Minecraft, Fortnite, or any other game; these are virtual worlds or platforms that are likely part of the metaverse, just as Facebook and Google are part of the internet. For similar reasons, we should view the chaotic world as singular, just as we say "The Internet" rather than "an Internet." Another frequently confused issue is the relationship between the metaverse and Web3, cryptocurrencies, and blockchain. These three may become important components in realizing the metaverse's potential, but they are merely principles and technologies. In fact, many leaders in the metaverse are still skeptical about the future of cryptocurrencies.

The metaverse should not be seen as a major patch for the internet, nor should it be viewed as something that will replace all mobile modes, devices, or software. It will generate new technologies and behaviors. But this does not mean we should throw away the things we like. I still write on a PC, which may still be the best way to write long texts. Today, most internet traffic is generated and terminated on mobile devices, but almost all of it is transmitted over fixed-line cables using internet protocol suites designed in the 1980s.

The metaverse has not yet arrived (even if some executives claim it has or is about to). At the same time, the transformation has not experienced a "switch flip." We are currently in the mobile internet era, but the first mobile phone supporting cellular networks appeared in 1973, the first mobile phone supporting WiFi appeared in 1991, and smartphones emerged in 1992, continuing until the iPhone in 2007. While it is impossible to say when the development of the metaverse began, it is clearly underway. In mid-2021, just weeks before Facebook announced its metaverse intentions, Tim Sweeney, CEO and founder of Epic Games, the maker of Fortnite, tweeted the pre-release code of the company's 1998 game "Unreal," adding that players "could enter portals and travel between [different worlds]… without combat, [just] standing in a circle chatting." These experiences did not make waves at the time for many reasons—there were too few people online, the tools to create worlds were too difficult to use, and the devices capable of supporting them were too expensive and heavy, among others. "Our desire for the metaverse has been long-standing…," he added a few minutes later, "but it has only been in recent years that a sufficient number of working parts have begun to come together quickly."

On June 20, 2022, during the fourth NFT.NYC event in New York City, a billboard in Times Square read "Unlock the Metaverse"

Another common misconception about the metaverse is that it does not necessarily have to be "hysterical." The term "metaverse" comes from a dystopian novel, Neal Stephenson's "Snow Crash." Predecessors of "Snow Crash," such as William Gibson's "Neuromancer" (1984) and Philip K. Dick's "The Three Stigmata of Palmer Eldritch" (1964), also left readers with the impression that the metaverse worsens the real world. Drama is the root of most novels, and utopias rarely serve as the backdrop for popular stories. However, since the 1970s, many prototypes of the metaverse have emerged that are not centered on conquest or profit, but rather on collaboration and creation. Every decade, the realism of these worlds improves, along with their functionality, value, and cultural impact.

The foundation of today’s internet has been built over decades through the work of government research labs, universities, and independent technologists and institutions. Most of these non-profit collectives typically focus on establishing open standards to help them share information from one server to another, making future technologies, projects, and ideas easier to collaborate on in the process. The benefits of this approach are extensive, allowing anyone to access or build on the internet from any device or network at low or no cost.

None of this has prevented businesses from profiting on the internet or establishing closed experiences through paywalls or proprietary technologies. On the contrary, the "openness" of the internet has enabled more companies to be established, reach more users, and achieve greater profits, while also preventing the giants that existed before the internet (notably telecom companies) from controlling it. Openness is also why the internet is considered to have democratized information and why most of the world's most valuable publicly traded companies were founded (or reborn) during the internet era.

It is not hard to imagine how different the internet would be if it were created by multinational media conglomerates to sell small plugins, provide advertising, or collect user data for profit.

However, the "enterprise internet" is merely the current expectation of the metaverse. When the internet was born, government labs and universities were essentially the only institutions with the computing talent, resources, and ambition to build a "network of networks," and few in the profit sector envisioned its commercial potential. When it comes to the metaverse, this is not the case. Instead, it is being pioneered and built by private enterprises.

In 2016, long before global corporate executives seriously considered the metaverse, Epic Games' Sweeney told VentureBeat, "If a central company gains control of [the metaverse], they will become more powerful than any government, becoming a god on Earth." It is easy to see that this statement is exaggerated. However, according to data from Citibank and KPMG, the metaverse could generate up to $13 trillion in revenue annually by 2030. Morgan Stanley estimates that both the U.S. and China could each see $8 trillion, similar to Goldman Sachs' global forecast of $2.5 to $12.5 trillion; McKinsey predicts $5 trillion globally. Jensen Huang, founder and CEO of Nvidia, believes that the GDP of the metaverse will eventually surpass that of the physical world.

It is here that concerns about utopia seem fair rather than alarmist. The concept of the metaverse implies that more and more of our lives, work, leisure, time, wealth, happiness, and relationships will be spent in virtual worlds, not just with the help of digital devices. It will be a parallel plane of existence, situated above our digital and physical economies, combining both. Therefore, companies that control these virtual worlds and their virtual atoms will be more dominant than those leading today’s digital economy.

As a result, the metaverse will sharpen many of the difficult issues of today’s digital existence, such as data rights, data security, misinformation and radicalization, platform power, and user well-being. Thus, the values, culture, and priorities of companies that lead in the metaverse era will help determine whether the future is better or worse than our current moment, not just more virtual or more profitable.

As the world's largest companies and most ambitious startups pursue the metaverse, we—users, developers, consumers, and voters—must understand that we still have the power to control our future and reshape the status quo, but only if we take action now. Yes, the metaverse seems daunting, even terrifying, but this moment of transformation is our opportunity to unite and change those industries resisting disruption and build a more equitable global economic system.

Many things about the future are uncertain, just as they were with the internet in the 1990s and early 2000s. However, we can understand how the metaverse might work and why; which experiences might be available when, why, and to whom; what might go wrong, and what must go right. As those executives of internet companies often remind us, this involves trillions of dollars in stakes and, more importantly, the future of all humanity.