South Korea’s investment in the meta-verse could be a model – Reuters

A companion with the Meta Oculus Quest 2 headset during a virtual reality tour during the Mobile World Congress in Barcelona in March 2022. South Korea is betting on Metaverse as the next big thing, but there are still questions about what form the industry will take. the coming years.

Joan Cros | Nurphoto | Getty Images

What form the meta-verse will take is still unknown, but South Korea is betting on the nascent industry as the next big thing.

As part of its Digital New Deal, a program to invest in new technologies in the country’s economy, the Ministry of Information and Communication Science and Technology plans to revive South Korea’s metaverse industry by supporting companies and creating jobs.

Science and ICT Minister Lim Hyesook called the meta-verse an “unexplored digital continent with undefined potential”, with the government allocating 223.7 billion won ($ 177.1 million) to the venture.

At the city level, the Seoul Metropolitan Government is building a 3.9 billion won metaverse platform to give citizens virtual access to public services.

The meta-verse, which was in the spotlight last year, refers to technologies like virtual reality and the idea that people can play and live in virtual worlds. It has been hailed as the next frontier in technical services, especially since Facebook renamed itself Meta and promised to build a metavers-focused future.

All of this fits into the concept of Web3, a broad church that includes metaverse, virtual reality, augmented reality, and blockchain technology, as well as digital assets such as cryptocurrencies and non-fungible tokens (NFTs).

Who will be the first?

South Korea’s investment of approximately $ 177.1 million is among the first investments in the burgeoning industry made by a national government and is a cautious first step into the metaverse.

It signals interest in a technology that may come to the forefront in the coming years – and it may be a model for others to follow.

“It is interesting, it is mostly a private sector and a major technology-driven initiative and trend. “Governments have not done much beyond South Korea,” Yugal Joshi, a partner at research firm Everest Group, told CNBC.

Other public authorities in Asia also take note. Authorities in Shanghai have encouraged the construction of utilities with the meta-verse in mind, as previously reported by CNBC.

“Some things happen in pieces, but I think it tells you that governments are starting to take this more seriously because it’s a platform where people meet. Everything that brings people together is of interest to governments. . “

Joshi said that in China, technology giants like Tencent and Alibaba have shown a keen eye for metaverse product development, with the latter recently investing in an AR eyewear startup.

He added that metaverse activity in Asia, like the rest of the world, is still in its infancy as companies invest time and money to find the first big winning app.

Despite growing interest and South Korea’s plans, no country has emerged with a clear first-mover advantage, he said.

“How governments will use it is still undecided because the whole ecosystem is still undecided. It is still under construction.”

How metaverse technologies will interfere with existing rules is therefore among the many issues that governments and policy makers will have to contend with in the coming years.

For example, NFTs, a core part of many metaverse developments, remain in a legal gray area of ​​South Korea and are not subject to the same rules as cryptocurrencies.

A spokesman for the Ministry of Science and ICT declined to comment beyond his public statements.

But so far, the adoption of NFTs or crypto in the country has not been restricted and big names are jumping on the trend.

Record-breaking K-pop group BTS announced an NFT project late last year. Despite some setbacks from fans over environmental concerns – NFTs and cryptocurrencies require a lot of computing power – the project is moving forward.

Meanwhile, Korean Electronics, the Korean technology giant, launched a blockchain and cryptocurrency division earlier this year.

New frontier, new risks

Javier Floren, CEO of startup NFT DNAverse, said countries experimenting with these new technologies will understand them better in the future.

However, this experiment carries several risks. Cryptocurrencies, another important component of Web3 and metaverse development, are notoriously volatile, as seen during the price crash in May.

For a country like El Salvador, which has made bitcoin a legal tender, being at the forefront of new technologies also means being vulnerable to such risks.

“It will depend on how different countries approach the legal side,” Floren said.

“With any new disruptive technology or ecosystem and new places to interact, there will be problems, challenges and definitely dangers.”

Governments will have to “change their thinking a bit,” he said, to make sense of both the opportunities and the risks, such as users’ privacy or the threat of fraud. .

“In the beginning, there will be no legal support or coverage from official institutions, so governments need to understand how Web3 is evolving because [existing] protocols will not work in Web3, ”Floren added.

Think before you act?

Meta imagines a metaverse where people socialize in digital worlds through avatars. But a new digital experience also brings old problems with it. Issues of privacy, security, safety and illegal activities will be challenges for these platforms and the authorities that oversee them.

These are the myriad problems that South Korea and other governments will have to contend with as they embark on the metaverse, whether it is using technology to improve civic engagement or deciding what role they will play as regulators of a expanding technology.

In light of this, South Korea plans to set up a body that brings together various ministries to monitor issues such as data protection, illegal behavior and the protection of intellectual property.

But cooperation between different authorities may be necessary if Metaverset becomes as ubiquitous as its proponents hope.

The Institute of Engineering and Technology, a UK-based organization, released a report in April that raised concerns about abuse or illegal content in the metaverse. Children are at risk, he said, citing a study that showed two-thirds of parents do not understand how Metaverse works or what content their children have access to.

“No one thinks about it in a meaningful way, which is unfortunate because it is actually very important, but it has also happened on social media,” Joshi said.

He added that there are plenty of companies jumping on the metaverse ‘wonder car’ without looking at these particular risks.

“I have not come across many areas where vendors are building these platforms or even companies that are really thinking about these things.”

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