The Metaverse explained – Definition, Introduction and Examples

Everyone talks about the Metaverse as the next evolutionary step of the internet - But what is it?

What is the Metaverse? Why should you understand it, and what use cases does the metaverse even have? Here the Introduction and explanation of the next evolution of the internet.

After the renaming of Facebook into Meta there was a new hype around the word “Metaverse” but nobody really knows what It meant. In fact, there have been a lot of speculations for many years about how the internet and technologies evolve. Commonly we refer to Web1, Web2, Web3 etc. when we speak about different evolutionary steps of the internet, and now we have the metaverse under discussion.

But let’s just leave the definitions behind and imagine something: Imagine that you can create your perfect alter-ego in a virtual world where you are in control of every aspect. You can do what you want, you can own what you want, and you have almost limitless possibilities.

Such a scenario was often depicted in some science fiction movies or series. But soon it could become reality as there is a big hype in the business world around making every layer, technology and protocol ready to create “The Metaverse”.

What is the Metaverse?

The metaverse is a massively scalable, persistent network of interconnected virtual worlds focused on real time interaction where people can work, socially interact, transact, play and even create. It uses advanced virtualization and technologies (AR, VR, Haptic Sensors, etc.) to fully immerse the user into the virtual world. This means that the user can interact live with a world that is always there, and he can always access whenever he wants.

Many advocates believe that the perfect futuristic version of “The Metaverse” there would be one single platform where you have your persona, your identity and platform services connected under which many worlds get created where you can gain access. Like a world with many sub-worlds which you can join, leave or even create. Important factors are still that there is a definition for a digital identity, digital ownership, digital currencies and the universal transferability of digital assets – Thus enabling a fully functioning economy in a virtual world.

This way the metaverse could replace several aspects of how tourism works, what it means to go on a concert, how to discover art exhibitions but especially also how people learn, study, interact and even meet friends.

Evolution from Web 1, Web2, Web3 to the Metaverse

While there is no clear consent about the definitions of Web3 and the difference of the Metaverse, there is a lot of discussion. A lot of crypto enthusiasts like to believe that crypto is the next stage of the internet, while others argue that after the social interaction based Web2 we will see the jump into the immersive Internet called “Metaverse”. Till now it’s not clear where to set the cut and where to differentiate, but the discussion will continue if Web3 is crypto and blockchain or immersive internet with virtual worlds.

Metaverse Examples

There is no example of a big metaverse at the moment. Different companies, especially game studios, are claiming that they created a metaverse.

  • Meta Horizon Worlds – Facebook launched a virtual meeting room environment which can be accessed via the company owned Oculus VR headsets and the Horizon Worlds. It allows interacting with peers in virtual meeting rooms with your own avatar but in future it should be also the basis for more offerings coming from Oculus and Meta.
  • Microsoft Mesh Platform – Microsoft is also pushing into the mixed and extended reality space (XR). Therefore, they are trying to launch mixed-reality elements into Teams in 2022. This should allow avatars and holograms to be at events, meetings and even use it in future for retail experiences and gaming.
  • Roblox – Roblox started as a gaming world where you can create your own games as a user and give others access to them. After the IPO, they are more pushing towards creating their own metaverse. Teaming up with brands like Vans and Gucci, they offer now also exclusive assents to buy for your virtual self.
  • Minecraft – Over 140 million users are regularly playing the Lego like game world Minecraft. The company was bought from Microsoft where players create their character, a creation of unlimited virtual worlds on their own incl. digital assets and more.
  • Second Life – Already founded in 2003 it was one of the first virtual realities where the player could create an own identity in a virtual world. After many years of development, Second Life is also now expanding with own marketplaces, digital assets and more.

6 Foundations of the Metaverse

Before we go deeper into the technological details, let’s examine what kind of different elements and foundations need to be in place to enable a metaverse. Creating a virtual world where you can control every aspect and also feel like you are directly in this world has many challenges.

Hardware & Infrastructure

Due to the massive amounts of data, 3D processing and also live interaction, there is a huge need for the right IT infrastructure. This includes network technologies from 5G and future 6G networks, cloud computing and super specialized virtualization hardware with GPU, TPU and CPU development for the server-side hardware requirements.

The second part is the consumer side, where special hardware is needed for the immersive experience. Virtual and augmented reality smart glasses, haptic feedback devices (gloves, suites, etc.) and even mobile phones with better processing powers are needed.

Tools & Standards

To make the metaverse really interactive, there need to be common standards and tool sets in place. This includes computer languages, easy to use design tools, commonly used 3D engines, VR/AR/XR standards, asset marketplace standards, transfer protocols, security standards but also more technological standards like geospatial mapping.

Payment & Transactions

An important aspect of every metaverse is a functioning ecosystem. In order to make this work, a universal mode of transaction and payment need to be found. This has challenges on several levels as every ecosystem might have their own modes of payment, transaction and makes it then difficult to connect different worlds together.

Regulatory Frameworks and Rules

Like in real world, we require regulatory frameworks and social rules in place. Managing and enforcing these rules in a virtual world could be one of the biggest challenges to solve. In order to make users feel safe, we need to think about global rules and even laws that govern the virtual world.

Identity Management & Avatars

A virtual world with a virtual identity might sound good, but to make sure that it’s also safe and not a “outlaw” world, also the verification of the real identity is a must. For this to happen in many worlds, there would need to be a common protocol and something like a meta-identity that can be linked to the own avatars and therefore be able to use avatars and identities in many virtual worlds.

Virtual Ecosystem

In order to make different use cases work, there also needs to be a functioning digital economic ecosystem. From Ad networks, to stores, virtual jobs and payment for games, Social Interactions, eSports and even online shopping. Creating this economic universe is very important to give more users and companies an incentive to participate, create and share.

Use Cases of the Metaverse

We have seen before, that most platforms that are created and called “metaverse” are at the moment focused on virtual events, virtual meetings and especially gaming. But there are many use cases for virtual worlds and it an be more than just a hype.

Social Interaction Platform

Like Second Life, it is possible to interact together and create the social interactions through immersion. Users can see others via virtual rooms and worlds, interact with each other, and also have social gatherings. This approach takes social media to the next level as it gets from asynchronous information sharing to a combination of asynchronous and synchronous (live) interaction.

Immersive Video Games

A big use case is of course also the creation of immersive video games. Just think about “Sims” with you as a real character in it. You can play in virtual works, create your own journey, play through your personal quests and much more. The VR technology incl. haptic feedback will allow for even deeper experiences where you can feel the environment and more.

Digital Marketplaces & Digital Business Models

As mentioned before, it is important to have a functioning marketplace and an economic ecosystem. This would also allow creating fully digital marketplaces and purely digital transactions in the metaverse. Auctions could be experienced from anywhere in the world, everyone would have access to all art he wants and much more. Just think about the possibility if you would be able to walk into Amazon’s web shop and experience the Products there as if they were in front of you.

This would allow also for disruptive new digital business models that would envision a fully digital world and monitization of these digital worlds.

Art and Culture Venues

Corona brought us a lot of virtual events and brought a lot of the art world online. But what about having virtual concerts, where you can not just look at a video stream but be there, interact with people and also meet people online while you are looking at art or listening to music? Creating digital equivalents of events, museums or art exhibitions online might give many more people around the world the possibility to consume art and culture in a completely new way. Seeing the Mona Lisa in the surrounding of a digital Louvre – not just from a picture on the internet.

Digital Art Creations

Roblox and Minecraft are great examples of how users can use a virtual universe to build the own world. Giving the user the freedom to shape, form and create worlds as he likes may give many more people freedom of creation. NFTs might play a bigger role in a environment like this as well as people want to own also digitally created art.

Augmented and Virtual Workspaces

Instead of seeing people on a screen with some video blocks, it could be possible to be in the same virtual room, brainstorm, write on a whiteboard and even change the room according to your needs. Augmented Workspaces would combine these features, allowing people to virtually participate in a physical meeting. This would mean that you have holograms in the room, you would experience the people and the avatars at the same time and be able to interact as if you were there.

Virtual Travel and Tourism

What about traveling the world without ever leaving the living room? In times when traveling is restricted and climate change as a pressing problem, it might be an interesting option to create virtual worlds. Imagine game-like environments where people are experiencing the Swiss alps, climbing the Himalayas or walking on your own through the Istanbul market. In virtual worlds it would be even possible to visit other planets, virtual worlds like Lord of the Rings or many other places we can maybe not imagine today.

Education & Schools

What about a virtual school class? Interactive walls, educational games, virtual experiences and much more? Especially for education and schools, an interactive world can be a big asset. When we teach about our solar system, it would be literally possible to be out in space, zoom to planets, and get data about them by just virtually clicking on them. The more fun it is to interact with your learning environment, the easier it is for children to learn. The metaverse could be also a game changer for rural areas or remote places, as long as they have internet, they could be getting the same elite education as others.

Criticism of the Metaverse

Everything sounds potentially like some overhyped science fiction and there are also many voices out there who see it more critically and point out that we, as humans, are not ready for creating such virtual worlds. The metaverse has several severe problems that need to be solved in order to become a safe place.

Privacy, use of information, mental health concerns and also real-world social implications are just some examples of the many concern areas. Just imagine if someone has a better life online than in real life, why would he want to live in the real world, date in real world, have children, get a real-life job etc. – There are already some series and movies addressing these issues that the virtual world might become more interesting than the real world.

Another issue also comes to the “winner takes it all” effect and the power it could give a single company. This means that literally one corporation could have the power to create a virtual world with its own laws, with an own economic ecosystem, with own identities and evading real world rules and governance. How should such a company be treated? What about taxes? What about real-world economic implications?

Conclusion on the Metaverse

The metaverse is a logical next step from the internet. From the early days when you could only read existing information to the age of social media and creators’ economy to the immersion of the virtual world into our own world. The direction of the internet and information age is clear, we will see virtual worlds popping up and users diving into these worlds.

We as a society still have many concerns to solve as social interaction, digital economy and also the illusion of the perfect virtual worlds will have a lot of implications on our physical daily life.

The development of metaverses is still in its infancy but with accelerating developments, billions being invested into this space and a huge push due to COVID it will be soon a bigger part in our life. Even Bill Gates estimates that in just a couple of years, most of the work and meetings will be done in the metaverse instead of physical meeting rooms and business trips.

We will see what kind of metaverse will take the masses and position itself to create the much needed network effect. The market is all about “the winner takes it all” and the metaverse might be the biggest example of a digital ecosystem.

CEO & Founder of MoreThanDigital. Serial entrepreneur since he successfully founded his first companies at the age of 13. He has always questioned the "status quo" and is committed to innovation, disruption and new ideas. As International keynote speaker, consultant for companies and governments & states, lecturer and published digital transformation expert, Benjamin tries to advance the topics of digitalization, digital transformation and innovation internationally.

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