Meta pulls out Deloitte to plug in the metaverse. Is anyone really convinced?
Comment Meta Platforms, Inc., which changed its name from Facebook two years ago to signal its commitment to the so-called metaverse, continues to insist that the much-vaunted digital environment has economic potential.
Of course, he has yet to realize that potential, or anything like it. The social advertising industry spent $13.72 billion on technology in 2022 to generate $2.16 billion in sales. And last month it revealed it had spent an additional $3.99 billion in the first quarter of 2023 to build its virtualized madness, to see $339 million in revenue.
He predicts the cash conflagration will shine through the year: “We continue to expect Reality Labs’ operating losses to increase year-over-year in 2023,” Zuckerberg’s Curse said. along with its report on the results.
The company’s year of efficiency also resulted in employee losses of 10,000 this year, in addition to the 11,000 announced in November 2022. So far so good.
Undaunted, Meta insists there is money to be made. “While the Metaverse is still in the early stages of development, it’s already possible to see its potential in areas such as education, gaming, wellness, and commerce,” said Rob Sherman, vice-president. chairman of Meta Policy.
There is some skepticism about this. Media reports find the proposal unconvincing.
Academics are no less skeptical. In November, Celia Pearce, a professor of game design at Northeastern University in the United States, attributed Meta’s failure to progress through the metaverse to its inability to create spaces that foster creativity like Minecraft and Second. Life.
“[Meta] really missed the mark in terms of creating something for the right audience,” Pearce told the Northeastern News Service. “They also missed the mark in terms of understanding the state of the industry, both in terms of what people visually expect from games and what people actually do in non-game experiences, which is to create things. Creativity is the killer app in virtual worlds.”
Full steam ahead!
CEO Mark Zuckerberg, convinced that AI is a source of potential growth during the company’s recent investor call, did his best to dismiss reports that his passion for avatars and headsets is waning. It has been said that he and his top executives such as CTO Andrew Bosworth and CPO Chris Cox spend most of their time on artificial intelligence in the era of ChatGPT.
“A narrative has developed that we’re sort of moving away from the focus on the metaverse vision, so I just want to say up front that’s not accurate,” Zuckerberg explained. [PDF] last month. “We’ve been focusing on both AI and the metaverse for years, and we’ll continue to focus on both.”
Zuck went on to say that AI technology was needed to create and grow the Metaverse, hence his interest in it.
To make the case for the economic generosity of the Metaverse, Meta cites a study “commissioned by Meta and produced by Deloitte”. And guess what? The study paid for by Meta reveals that the social network is on to something as evasively as possible.
There is a disclaimer regarding the third-party data cited in the report: “Deloitte has neither sought to corroborate this information nor to review its overall reasonableness.” But hey, who among us has not published a report that we will not defend? Just because Deloitte insists that “no information in the final report should be relied upon by a third party” doesn’t mean we can’t be blindly enthusiastic about investing in the Metaverse.
Where is your sense of adventure?
So what does the report say? Well, it covers a lot of ground. For the United States, it says “based on the currently projected level of investment, we estimate that the metaverse could contribute between $402 billion and $760 billion to annual U.S. GDP by 2035.”
It’s right after a passage that cautions: “The nascent nature of technology makes the size and timing of the economic impact of metaverses uncertain.”
On the one hand, it may just be Deloitte doing CYA; on the other hand, Meta commissioned this report and therefore now has to live with its public findings.
Above all, are you sold on the Metaverse yet? Before you take the Linden dollars out of your piggy bank, maybe it’s worth knowing what the metaverse is…
Or it’s the internet, but closed and paid instead of open and free, and with glasses, digital currency and (surprise!) the very property rights that online services currently deny their customers.
From 2020 until early 2022, the artist formerly known as Facebook wanted to operate the payment layer of the metaverse by overseeing transactions with his cryptocurrency Libra, now Diem. The story of the case is too tedious to discuss, but suffice to say that the rebranding could not make the project more acceptable. Government regulators and the public wanted nothing to do with the program.
Without a unifying payment layer, the metaverse could at least be a unified set of technical specifications through which different organizations can connect their virtual worlds so that participants can travel back and forth. You know, like the web, but wearing headsets and expensive digital adornments for his avatar.
Lots of players in this game
Evidence of this kind already exists. As Epic Games CEO Tim Sweeney recently impassive“The Metaverse is dead! Let’s hold an online vigil so that we, the 600,000,000 monthly active users of Fortnite, Minecraft, Roblox, PUBG Mobile, Sandbox, and VRChat, can mourn its death together in real-time 3D. “
There are indeed game players who spend time in virtual worlds, with or without VR headsets. It’s been going on for years and it’s a lucrative business. However, this is not proof that the general public wants to work and scroll with VR glasses instead of wielding a mouse and keyboard or touchscreen.
A 2022 study quantified the effects of swapping a desktop-based work environment for a VR-based setup for a week. “Among other results, we found levels of simulator sickness, below average usability ratings, and two participants dropped out on the first day of VR use, due to migraines, nausea, and headaches. anxiety,” the report said, citing frustration, anxiety and eye strain among other issues.
Sweeney knows that there is money to be made by gambling online. But his suggestion that game worlds bound together somehow make a metaverse overlooks the fact that cooperation between game companies is limited.
Epic has spent the past few years trying to avoid giving Apple a revenue cut for distribution through the App Store. Almost every game company in operation would rather own everything themselves than operate within a shared technical framework that allows customers to move between different entertainment properties without friction. Facebook has done its best to avoid letting users export their own social graphs. So goes the metaverse.
The Deloitte report cites three defining characteristics of the metaverse:
- Users can enter and interact with a virtual 3D environment while being connected to the physical world through virtual reality.
- A collective agreement to harmonize digital standards and protocols for platforms and devices would allow users to move seamlessly between digital spaces.
- Multiple users can access the virtual worlds at the same time and have simultaneous real-time interactions, with the virtual worlds continuing to exist (i.e. not reset) even when one or all users leave.
Broadly speaking, the proposals have problems.
3D is mostly aesthetic and rarely functional, meaning it’s not necessary for most entertainment experiences, which generally work just as well in 2D. 3D TVs didn’t sell because they didn’t add value. There are more use cases for VR and AR headsets, but not enough to change the way people prefer to communicate. Expect holographic projected interfaces and 3D gesture input.
We have digital standards and protocols. Many of them are already harmonized. The current lack of portability of digital assets across service boundaries, as well as the lack of extended digital property rights by service providers, suggests that companies do not want to worry about empowering users. They would rather be able to ruthlessly kick customers out of their services and owe them nothing.
And that brings us back to Meta’s message that there is money to be made that shouldn’t be taken as investment advice.