Thinking of jumping into the metaverse with your business? According to Thibault Launay, co-founder and CEO of Exclusible, we must first distinguish reality from enthusiasm.
What is the metaverse? Its definition can turn out to be radically different depending on the person. For the older generation, even a call via Zoom could be considered “metaverse”.
The most common answer to this question evokes a kind of virtual reality wonderland that constitutes the next great revolution. This is the new dream that Meta/Facebook has spent $10 billion on to restore its image and conceptualize its own metaverse. However, companies clearly misunderstand this nascent digital space, even in its definition.
After studying more than 100 different metaverses on the market, I narrowed down to four very specific misconceptions that newcomers should know about these virtual worlds.
Like many new frontiers, the infrastructure of the metaverse is still under construction. The virtual world is a work in progress. It is only available to early adopters, primarily tech professionals and gamers.
Even the hardware necessary for a smooth experience is held back by accessibility barriers, including the requirement for high-end graphics cards and computer processors. All of these remain held back by a disrupted global supply chain.
The very first fashion week in the metaverse started off with a bang, but not without its faults. In particular, some users have reported that the experience is “very slow, confusing, or not working at all.”
The average person is not necessarily equipped with a gaming computer or even the minimal bandwidth needed to run these virtual worlds. Thus, most people find themselves limited in their ability to actually take advantage of the metaverse as it currently exists.
Now let’s take a look at other monumental changes that have taken place on the Internet. It wasn’t until smartphone ownership overtook traditional cell phones that the use of social media really took off. Nor would it have been possible without the built-in cameras that rival digital cameras, or without the expansion of the mobile data network.
Of course, the metaverse is here and improving every day. But it just doesn’t exist in a meaningful way that already touches the mainstream.
Misconception #2: All businesses lose by not joining the metaverse
By way of preface, there is no doubt that companies can miss out on their place in the metaverse if they do not act quickly. However, the extent to which sectors should join this universe and start touting their products on billboards in the virtual world is limited.
At least for now, these sectors include technology, gaming, the entertainment industry, and crypto domains. Keep in mind that these are more of the demographics that have geared up to access most of these metaverses.
The companies that contacted us and want to market their products in the metaverse are very diverse, from fashion houses to insurance companies. We cannot guarantee that active users of virtual worlds seek favorable prices for their car insurance. But industries like fashion find themselves particularly suited to this space, as avatars need clothing and accessories to express themselves.
As metaverses evolve, new use cases will pave the way for others. But for now, you can safely count on “fun” industries like gaming, art and fashion, or real estate to dominate the space.
Companies hesitant to join the metaverse may be open but skeptical. There is no reason to join the virtual world until there is a clear path to follow, with tangible goals that can meet business goals.
Myth #3: the virtual world is a 4D video game
For starters, there are currently hundreds of metaverses, each appealing to different people. Many virtual worlds today have game elements, but this does not mean that metaverses are developed with players in mind.
For example, The Sandbox features more traditional game mechanics in a pixel art style. It is clearly aimed at people who are familiar with video games. On the other hand, Spatial is more graphically advanced and aesthetically focused. It is perfect for digital art galleries and other events that require high quality graphics.
For more gaming-focused metaverses, their biggest difference from traditional video games is ownership. In a video game with its own currency, everything you buy and own is related to the game. And for online games, if the developer ever decides to shut down the servers, the in-game stuff you have will disappear.
This is contrary to the idea of true digital ownership. Digital assets are meant to be stored forever as they are recorded on the blockchain, which is part of Web3’s core ethos. This is still a real problem for the metaverse and can pose problems for companies trying to sell a product.
Myth #4: The Metaverse aims to replace reality and will destroy our future
As with any new technology that emerges in the cultural zeitgeist, there is much to be said for the media’s alarmist stance on the impact of the metaverse on our children’s future. The received idea would be that they would allow themselves to be absorbed into digital worlds to the detriment of their real lives and withdraw from the world around them.
This does not mean that excessive internet use is not a problem. Young people are more depressed than ever, and screen time only exacerbates the problem. However, the media may be on the wrong track.
Generation Z lives its formative years against the backdrop of extreme historical events. These include weather events due to climate change, the rollback of human rights, international wars, rising income inequality, the housing crisis and successive pandemics. Is it any wonder that escaping to the Internet helps them stick?
Ultimately, the metaverse presents itself not as a new iteration, but as an upgrade of the current internet. It is very similar to social networks and other facets of the Internet that allow everyone to express themselves. Participation in the metaverse is simply an extension of our reality.
As a recent VRchat documentary shows, there are already use cases for the metaverse to improve the lives of its users. Even in its most primitive form, the cornerstone of the virtual world is to provide a new way for people to connect with each other.
For now, it can feel like the Wild West. It will be up to developers and users to ensure that we shape our ideal metaverse with rules and a culture that protects and uplifts its users and future generations.
Review your approach to the metaverse
Web3 startups build on existing metaverse experiences. There is no doubt that both progressive and traditional businesses want to take advantage of this new move and gain an edge by joining the virtual world.
But to fully exploit its potential, companies need to rethink their strategy and question their reasons for joining the metaverse. Do you want to meet users where they are and improve their virtual experience, or are you participating in this project just for the thrill of it?
About the author
Thibault Launay is the co-founder and CEO of Exclusible, the luxury industry’s benchmark platform for metaverse and NFT activities. A serial entrepreneur and angel investor in various industries, he is a member of the NFT Blackpool hedge fund, an advisor to OVR.ai and a noted collector of NFTs and physical vintage watches.
Thibault is a former student at Paris Dauphine University, Harvard Business School and the Forbes 30 Under 30 association.
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