If you were looking at “metaverse” mentions alone in 2022 earnings calls, you might be fooled into thinking massive adoption is underway, a-la Facebook in 2007.
Mentions of “metaverse” in earnings calls (Q1 2016-Q1 2022)
And in the last three years, three concurrent forces emerged that could have catapulted the metaverse into the next ubiquitous computing platform, similar to how the iPhone turned cell phones into pocket computers in 2008. These cultural moments have been catalyzed or amplified by the forced isolation of the a pandemic. They are:
- The loneliness epidemic
- Remote school and work
- Diversity, equity, and inclusion
Below we look at these three cultural moments and consider what the missed opportunities with each mean for the future of the metaverse.
1. The loneliness epidemic
As Luminary Labs summarized it, “before the coronavirus pandemic, there was the loneliness pandemic. Three in five Americans say they are lonely.” Forced isolation and social distancing during the pandemic exacerbated loneliness, but also jolted us into trying new ways of interacting remotely. Zoom Christmas became a thing that even grandma attempted.
But the change in circumstance didn’t change the underlying mental health crisis. Loneliness leads to depression, and depression saps motivation, especially motivation to try new things. Ironically, virtual reality (VR) — the metaverse’s cornerstone technology — can effectively treat depression and anxiety, among other psychological and physical disorders. But outside of a few medical vanguards, no metaverse investor made significant strides to bridge the user motivation gap.
2. Remote school and work
Remote school and remote work are both here to stay. At a minimum, remote school will be a supplement to in-person schooling. (Goodbye snow days!) At a maximum, remote school will continue to unlock access, including for disabled, rural, and other student populations. Similarly, remote work will continue, as demand from workers is clear and employers are trending towards offering it in a competitive labor market. Metaverse solutions could arguably be the highest quality and lowest cost tech for both. An Oculus Quest 2 costs less than many Chromebooks, and offers many more capabilities. Further, two of VR’s biggest applications to date are in education and professional training, from surgeons to customer service reps.
Despite the high potential use cases and cost efficacy, no big employers or schools have announced the launch of internal metaspheres. This is likely for the same reason accounting firms issue buggy five-year-old laptops to employees making six figures: internal infrastructure is viewed as a cost center, not a value-generator. Why give employees infinite screens on their Oculus when they can still eke out the “same” work on their tiny laptop screens? Metaverse investors have done little to reverse this myth. So educators are likely to continue cobbling together free and lower cost resources, and employers are unlikely to significantly revise their budgets for remote work systems development.
3. Diversity, equity, and inclusion (DEI)
For as little as $15, anyone can begin to experiment with VR and, thus, the metaverse, via Google Cardboard. With one download, you can fly around the globe in Google Earth, visiting the Coliseum or the Pyramids. And on Oculus, popular games like Beat Saber cost half as much as Nintendo Switch games. This affordability presents an epic inclusion opportunity. Oculus Quest 2 sales have already topped 15 million, making the barriers to participation pretty low. In addition to being relatively affordable, the diversity of subcultures and self-expression possibilities are endless. Inclusion could be easier with the freedom to choose avatars that reflect your identity. A woman can choose a male avatar, a man could choose a wolf avatar, and perhaps in the future, a gender fluid person could change their avatar daily if they so chose.
Despite the metaverse’s economic accessibility, and its potential to welcome diverse populations equitably, most people don’t seem to see themselves participating. Critics hesitate to become legless floating bodies, and some women feel awkward in the currently male-dominated spaces. As many companies have learned in the great return-to-office debate, cultivating a sense of belonging is not as simple as just creating the persistent space. And its not clear that metaverse investors are creating welcoming on-ramps to expand inclusion.
Did metaverse miss its moment?
Why did the metaverse’s biggest advocates, from Microsoft to Facebook, not double down on pushing products like Mesh, the holographic collaboration tool, or experiences like Meta Quest meet-ups (surely a welcome alternative at the height of Zoom fatigue)? The problem seems to be two fold: lack of focus and premature hype.
The metaverse remains so loose a concept that even tech evangelists are confused about what it is. In theory it’s such a flexible concept — inclusive of most shared, persistent digital spaces — that, with some interest and ingenuity, early investors should be able to find pockets of growth. But instead that flexibility has cultivated a lack of focus. A very expensive lack of focus at that — Meta’s investors hammered the stock for having too little to show for its $10 billion of losses per year. While Oculus hardware is making great strides, the virtual experiences themselves haven’t reached the quality level that can attract everyday use. And with very public tech flubs like Facebook’s virtual Foo Fighter’s concert mishap, the technology clearly isn’t ready to support mass adoption.
The metaverse today is like QR codes in the 2000s — useful, but not convenient, intuitive, or ubiquitous enough to see mass adoption. That took a pandemic to change. And the metaverse has (hopefully) mostly missed this one. But that doesn’t mean it won’t catch the next growth opportunity. And we certainly can’t call the three cultural moments discussed above — loneliness, remote school and work, and DEI — solved problems. The metaverse is on its way. Just more slowly than its proponents would have you think.
MBA in the City 