The Metaverse. We’ve all heard the term but what is it really? Although many paint the metaverse as a giant digital world, a more realistic way to think of it is interoperable enhanced digital experiences; interoperable meaning one can easily interconnect their online avatar, profile and digital belongings among various platforms and use them together, for example let’s say you’re in a metaverse room on Zoom and you wanted to share an NFT you bought on Ethereum, you could easily do that.
A realistic example of the ‘Metaverse’ would look something like taking things such as social media, online commerce, and E-learning and enhancing them with virtual reality, or augmented reality, essentially furthering the merge between the digital world and the physical world.
In a research article recently published by Morgan Stanley, the estimated total consumer expenditure TAM for the U.S. is roughly $8.3 trillion.
Source: Company data, PWC, Bureau of Economic Analysis, Census Bureau, National Center for Education Statistics, Morgan Stanley Research. Note: Concerts/live events and casino estimates are normalized.
Although the Metaverse potential growth is high, it will likely be a longer-term play. As the internet transitions into web3, the likelihood that there will be a mix between web3 and the metaverse is strong. Although virtual real estate has gotten a lot of buzz, the key transitions to look for will probably be in advertising, online commerce, and NFTs.
An example of a slightly longer-term possibility in our estimation is the ability to attend live virtual events such as concerts or sporting events, how is this possible?
To reference a real-world example of this, the Brooklyn Nets recently implemented and tested a live 3d scanning technology, allowing people to experience watching the game in a VR, enhanced digital experience. Assuming the graphic development of technologies such as live 3D scans is up to par, the way we experience events from home such as sports may totally change, and frankly, TV is likely in for a change.
A more immediate place where the metaverse is making progress is, as expected, in gaming. Sony and the Lego family recently just made a $2 billion dollar ‘Metaverse’ investment into Epic Games.
The transition is real and with giant tech companies such as Meta, formerly Facebook, shifting focus to web3 and the metaverse, there’s really no telling where things will lead, but this innovation is seemingly inevitable.