The metaverse market has grown quickly over the last few years, and accelerated by Facebook changing its name to Meta in 2021. Businesses around the world are tapping into its potential, while exploring how it will impact their long-term strategies. Some are exploring web3, and how they can make strong communities based on decentralised principles. Others are building virtual worlds and selling metaverse land. And many more want to embark on a journey of metaverse analysis, to keep track of the burgeoning and vibrant area.
The potential is huge. A market opportunity worth billions is open for businesses and consumers, ready to tap into the next era of spatial computing. But the area is dense, too. Multiple kinds of fraud, and a lot of misconceptions, have warped the market and obscured where to look. This article will dispel some common answers, to help guide you on your way.
If you are interested in keeping up to date on the latest metaverse analysis each week, consider checking out the Immersive Wire. The concise newsletter will give you an edge, with a robust analysis of the market each week.
What is the main idea of the metaverse?
At its heart, the metaverse is a confluence of contingent technologies that will shape the future of the internet. The form it takes is up for debate, as some focus on the decentralised nature of web3 and how it will form new kinds of ownership. Virtual reality (VR) and augmented reality (AR) could play a part as well, though some companies focus on different technologies in differing ways. Meta is focusing on a broad swathe of immersive technologies, such as VR. Niantic is focusing on AR, and how it could build a real-world metaverse. And Animoca Brands focuses on the core principles of web3.
The difficulty of metaverse analysis is that the definition is still under debate. One reason is that it is hard to say what shape it will take. Ask someone in the 1900s to predict the future, and the response would be based on their own experiences and language. The same is true here. But at its core, we know that it will form a new version of the internet that will connect people together in new and immersive ways.
How can we do metaverse analysis?
Based on the above, it may be tempting to say that we cannot analyse the metaverse at all. How can we focus on something so intangible, or vague? How can companies cut through the noise, when few can agree on the core principles of what it is? But in reality, it is still possible to cut through and find broad trends on where the market can go. A few principles to follow:
- Keep a sceptical mindset. Many people attempt to fleece people who lack an understanding of the space. Examples include buying NFTs when they are worthless, or contributing to projects that get pulled away. Before putting money anywhere, keep a cautious eye out.
- Look at the data. Rather than focus on qualitative insights on Twitter, see if you can find information from trusted resources that collate information. WeMeta is one example, who also tracks the value of metaverse land.
- Keep an eye out for new opportunities. Metaverse analysis can go well beyond current trends, such as a focus on improving workplaces and enterprise training. It will open new doors for creatives and professionals, unlocking new types of services that are difficult to predict. Keep an eye out for them and then follow it down the rabbit hole of enquiry.
What is the metaverse market size?
Hard to say. The difficulty in answering the question is that we are attempting to evaluate the potential of two key areas. One is how it will impact businesses and their key processes today, such as how they reach customers and improve their own workplaces. The other is evaluating whole new markets that are nascent today, such as creatives who sell apparel for online worlds.
With that said, a few companies have taken a stab at evaluating the metaverse market:
- Frost & Sullivan: $750bn by 2030;
- McKinsey & Company: $5trn by 2030;
- Citi Bank: $13trn by 2030.
All these numbers should be taken with a grain of salt. The disparity between them all spans trillions, or the value of multiple countries. Metaverse analysis is difficult because we are dealing with a growing area with a lot of potential, but the most profitable areas over time are difficult to say. Still, we should expect the market to be worth a lot in the years to come.
What do experts say about the metaverse?
Nearly all experts agree that the metaverse will bring a lot of value for customers and businesses, though they focus on different areas. Some focus on the decentralised principles of web3, and how it will form new communities that will rupture the current modes of loyalty programmes. Others look towards the spatial parts of the metaverse, and how people will converse and trade in new virtual worlds.
With that said, here is a selection of what experts say about the metaverse:
- Matthew Ball, investor and analyst, from his blog: ‘We can guess that the Metaverse will revolutionize nearly every industry and function… [and] altogether new industries, marketplaces and resources will be created to enable this future, as will novel types of skills, professions, and certifications. The collective value of these changes will be in the trillions.’ (His book is excellent, by the way).
- Tim Sweeney, CEO of Epic Games, on VentureBeat: ‘This Metaverse is going to be far more pervasive and powerful than anything else. If one central company gains control of this, they will become more powerful than any government and be a god on Earth. What we want is not a company but a protocol, that anyone can implement.’
- Robby Yung, CEO of Animoca Brands, on Decrypt: ‘There is no metaverse without web3, because you need to have that transaction layer so that you have interoperability between content and you can bring it from place to place.’
Does the metaverse have a future?
While the shape of the future is under debate, there is no doubt that the metaverse has a future of some kind. Companies like Meta are investing billions into the market, innovating on hardware and launching high-quality VR headsets. (CCS Insight reckons that Meta will add a neural sensor by 2025). Large companies like Yuga Labs, which did not exist before 2021, grew to be valued in the millions in a short space of time. Creatives are already forming decentralised communities, curating access via tokens. All of these trends will continue in some shape, even if the destination remains obscured.
Still, it is difficult to say which part will win over. Perhaps decentralised communities will thrive and grow quickly, while VR remains nascent. IDTechEx predicts that major metaverse players will continue to work together, which mirrors my own views. Or perhaps metaverse platforms will evolve to become the go-to places to socialise, becoming a home for millions of users around the world. Or perhaps AR glasses will finally take shape, providing an overlay of the real world which people can interact with. All of this is possible, but hard to predict when it comes to timings or success.
Based on my own metaverse analysis, the best experiences will be frictionless and powerful. The platforms or technologies that thrive will be easy to use, access, and interact with. If that happens, mainstream adoption will come swiftly. One example could be that the metaverse thrives on mobile, which Daren Tsui, CEO of Together Labs, predicts as well.
Where can I learn about the metaverse?
The best places I have found have some level of curation. Twitter and Discord remain great places for conversations, and I have had a fair few hearty debates from time to time. But it is also riddled with misconceptions and misinformation. The sites should not be fully trusted for high-quality information unless you follow trusted people that cite their facts.
So beyond social media, I trust a few places to learn more about the topic. One is in a selection of metaverse books which I have curated, where each one focuses on a different part of the conversation. All of them have some value, though I recommend cherry-picking a few areas to focus on. I also trust a few sites as well; The Drum provides an excellent newsletter on the marketing, side, for example. The site can be found alongside a variety of other metaverse newsletters I trust.
As mentioned, I also run a concise newsletter on the topic, which helps to brief professionals each week. Have a look, and I hope it helps you with your journey!
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Editor, Immersive Wire
Tom Ffiske is the Editor of the Immersive Wire, a weekly newsletter on the immersive industry.