According to whom you ask, the answer varies a lot. Here are some concise insights on the visions of a metaverse by the big tech players like Meta (Facebook) and blockchain/Web3 crowd.
The word “metaverse” is mainstream since 2021 when Facebook changed its name to Meta with its new focus on metaverse development. For me, another type of metaverse, a blockchain-based world called The Sandbox, became very tangible when a company I was running at that time, Lympo, started developing a social hub on this gamified world.
Recently, I had a chance to discuss different metaverse visions with some of the key players in the market. What I found out is that the term “metaverse” means very different things to these stakeholders and it is time to engage with all these various ideas to understand what is behind them.
One of the common ways to describe the metaverse is to see it as an immersive world, a 3D version of the internet, where we will do everything what we already do online and much more in some form of extended reality, for example, via virtual reality (VR) headsets or augmented reality (AR) applications where using a specific tool, like a smartphone, we see additional visual elements of the space. Some of these use cases are already being tested or developed by, for example, Microsoft or Meta.
Those who are more aware of the web3/blockchain community version of the metaverse, have probably heard more about the ownership of the pieces of our lives online (e.g. our social media profiles, the content that we post on social media like this article) via non-fungible tokens (NFTs), in short digital property rights. Or about decentralized metaverses or open metaverses which can mean decentralized technologies, decentralized business models, decentralized governance. More on this see Yat Siu, Chairman of the Board of the web3 leader Animoca Brands.
However, it is not the single properties alone that define the way metaverse is viewed from these different angles. There is a comprehensive underpinning behind these visions which are important to understand to decipher what strategies these players follow. Otherwise, discussions get lost in translation, for example, why blockchain metaverses have such seemingly low fidelity graphics. Or why is Meta losing so much money in its VR hardware business.
Here is a framework that I developed to look at these various models:
*The term coined by Herman Narula in his new insightful book, Virtual Society: The Metaverse and the New Frontiers of Human Experience.
Meta and other big tech players are going all-in into developing the right hardware technology (VR) for the metaverse to kick off. The assumption behind this is that immersion, this new exciting user interface, will be the defining factor drawing users to the metaverse. Its main business model is that of a platform, i.e. charging businesses and creators for utilizing the platform to reach out to their users and monetize them. For example, creating some exciting paid applications or some free applications that feature advertisement just like app creators are interacting with mobile phone users today (and paying 30% fee from their sales to Apple as a platform). The governance model of such a metaverse remains the same as it is a product of an existing corporation.
Web3 developers focus on the software part of this other version of a metaverse, a blockchain-based infrastructure. Only this technology can ensure the defining trait of this metaverse: creation of meaning. In this context, “meaning” is a shared notion of history and a possibility to irreversibly alter the metaverse. Let’s take a look at both of these aspects. I am born in the Soviet Union, a country that fancied manipulating the past the way it suited its political goals. The process has been beautifully depicted in the scary George Orwell’s dystopia 1984. Such world does not have a meaning, because what actually happened can be at any time be deleted, reinterpreted or adjusted. Blockchain technology enables immutable record keeping on what happened in this extended world, for example, the time when I founded a new kingdom or launched an online learning community on a metaverse.
The other aspect is a possibility to impact such metaverse by changing it. It ties to the same technological capability of the blockchain technology, but has a different angle. Only being sure that the history in not manipulated, but unable to actually leave a mark in it, doesn’t create meaning. It would feel like watching a movie. But if I have capacities to create new characters for that movie and to change its course of event for all, I become an active participant in this parallel reality. In this case, graphics or immersion does not matter that much if I cannot create meaning and actually easy to use technology allows for more participation (think @Minecraft, the best-selling video game of all time).
The business model is fueled by a token economy of that particular world, an internal currency of this other reality. So, it doesn’t focus on charging the creators, but on good token architecture (The Sandbox, in comparison, charges 5% fees). A web3 metaverse is centered around creators to allow the best possible ways to contribute as this grows the ecosystem and thus impacts the token demand. And while it can be run as a corporation, a web3 native form of governance is a DAO (decentralized autonomous organization), a system that enables contributors of a product to coordinate, govern and trust each other.
There are some dimensions where these two different visions of a metaverse compete and some others allowing to cooperation and meaningful exchange. One thing is clear: these worlds are very different and most probably we will have a chance to experience and navigate between both of them.
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