What Is the Metaverse, and How Will It Affect Businesses?

By 2030, 5 billion unique users are expected to be using the metaverse. The metaverse, which has been called “the next iteration of the internet,” was one of the biggest technological buzzwords in 2022, thanks to help from tech giants such as Facebook and Microsoft. Yet, many people are still wondering, what is the metaverse exactly? 

In simple terms, the metaverse is an immersive, interactive, 3D version of the internet. It might sound similar to other virtual reality platforms that already exist, such as video games like Fortnite, however, it’s a much bigger deal. The metaverse will function as an augmented world that’s almost indistinguishable from the real world. It’s a concept that has gained the attention of many of the biggest companies in the world, including Facebook, Google, and Apple, all of which are investing billions of dollars into it. In fact, Facebook, Inc., the parent company of Facebook, rebranded its corporate identity to “Meta” in October of 2021, announcing that it would be investing at least $10 billion into augmented reality.

The term metaverse was first used in the sci-fi book Snow Crash, which described the life of a young pizza delivery man who spent his free time “plugging” into a simulated world where he interacted with others as an avatar. Some now wonder if one theme of Snow Crash—that computers can hack the human brain—shines a light on the possible drawbacks of the metaverse, such as the potential for people to lose their ability to interact well with others face-to-face and to think for themselves.

Experts predict that for better or worse, the metaverse will forever change how humans live, work, and interact with one another. In this article, we’ll explain what the metaverse is, how it works, plus the pros and cons associated with this new type of digital realm.

What Is the Metaverse?

The metaverse is a 3D virtual realm that combines our physical and digital lives. It will allow people to shop, work, learn, and interact with others in an advanced virtual or augmented reality. Described as an “enhanced online environment,” the metaverse doesn’t refer to one specific platform or type of technology but rather a new way to interact with technology and the internet altogether. 

Some key features of the metaverse include that it’s:

• Immersive: Feels real and 3D, as if it’s actually occurring.
• Collaborative: Allows users to interact with each other in real-time.
• Persistent: It exists even when no one is using it.
• Interoperable: The eventual goal is to have users seamlessly carry their identity and information across multiple platforms.

The Metaverse Explained: Uses + How It Works

As an emerging concept, the metaverse is being explored and continuously developed by many companies and organizations in various ways. Because it’s still being built, it’s hard to nail down exactly how the metaverse will function or how deeply it will impact our lives. Some have compared the metaverse, the way it stands now, to the internet in the 1970’s: It existed, but no one was entirely sure of its importance or the path it would take.

How It Will Be Used

Much like with the internet, there isn’t only one way to use the metaverse or a single company that owns and operates it. “A metaverse” can be used to describe a wide range of games and apps, ranging from virtual reality experiences such as concerts to online dating experiences. As a collection, all of these separate metaverses come together to form “the metaverse.” 

Potential uses of the metaverse, some of which are already underway, include:

• Shopping: It will include a large-scale digital economy where users can create, buy, and sell goods, including clothing, food, and even real estate. Users will be able to browse and purchase products in a fully immersive, realistic environment, transforming the retail industry.
• Gaming: An early version of the metaverse is already being used in the form of fully immersive and interactive gaming experiences, where players compete or collaborate with each other in real-time. More gaming interactions will be launching in the coming years, some of which allow users to make money and earn digital assets from their wins. 
• Remote working: Because it allows instant communication and collaboration, the metaverse will assist in businesses and education, such as virtual meetings, conferences, and classes.
• “Live” entertainment: Users are expected to use the metaverse to “attend” virtual experiences such as concerts, movies, amusement parks, art shows, and other forms of interactive entertainment.
• Dating and socializing: The metaverse will include interactive platforms for socializing and networking, including advanced social media and dating apps. Experts expect technology-based socializing in the metaverse to be a step up from currently available apps because it will involve more body language, eye contact, tone of voice, and real-life elements. 
• Research and development: The metaverse will be used in scientific research, simulations, and for testing. In fact, it’s been said to have “limitless possibilities” for product design and development, as well as data collection.
• Other applications: These include those in industries such as travel, fitness, marketing, advertising, and healthcare.

Required Technology

Most people will enter and engage with the metaverse using:

• Virtual reality headsets
• Smartphones
• Computers
• Projectors that create holographs
• Consoles for gaming
• Motion-tracking tools, such as gloves with sensors
• Augmented reality glasses

Forms of the Metaverse

• Virtual reality (VR): VR describes a computer-generated simulation of a three-dimensional environment. When we use VR, it feels “real,” as if we’re really physically doing something in another space. We engage with VR using equipment such as headphones, a helmet with a screen inside, or gloves fitted with sensors.

• Augmented reality (AR): AR combines the “real world” and computer-generated content, such as images, text, audio, and other virtual objects. It works via electronics that project virtual pictures and characters into the physical, such as cameras and viewers. Many people already engage with AR on their smartphones or by using projectors. The main difference between virtual reality and augmented reality is that AR involves real-world elements and settings, while VR is completely virtual.

• Real-time collaboration software: The metaverse will offer the opportunity for plenty of immersive engagement in “real-time,” meaning you’re interacting with others live while they’re using the same platforms. It’s possible that each user may have their own avatar in the virtual world. Here’s how TechTarget describes how this will most likely work: “Digital facsimiles of ourselves, or avatars, will move freely from one experience to another, taking our identities and our money with us.”

Metaverse Companies

The metaverse is expected to be an $800 billion market by 2024. As mentioned above, many brand name companies, including Microsoft, Facebook (aka Meta), Apple, Google, and Qualcomm are investing enormous amounts of money into the metaverse. A number of lesser-known but still influential companies are also playing a role in designing and launching the metaverse, including Sandbox, Snap, Epic, Roblox, and Unreal.

Current and Future Metaverse Projects

• Meta: Meta has committed more than $10 billion into its Reality Labs division, which makes metaverse-related hardware, such as VR goggles and headsets called Meta Quest. Reality Labs was created to “bring together the brightest cross-disciplinary minds to build tools that help people feel connected anytime, anywhere.” In late 2021, Meta also launched Horizon Worlds, a virtual space that’s navigated as an avatar.
• Microsoft: Microsoft Mesh, in collaboration with the company Accenture, plans to offer virtual meeting rooms where businesses can interview and train new and remote workers in virtual settings. Meta’s Horizon Workrooms is a similar concept. Microsoft is also working on acquiring the gaming company Activision Blizzard to provide “building blocks” for the metaverse. 
• Roblox: This wildly popular virtual gaming platform already has almost 60 million daily users. Similarly, Fortnite, owned by Epic Games, has more than 20 million daily active users on average and has hosted virtual concerts that more than 27 million unique players attended.
• Sandbox: Sandbox is a leader in virtual real estate, as well as other virtual assets. In 2022, the company unprecedently sold a virtual space for $450,000. 
• RobotEra: RobotEra is a new platform that allows users to make virtual money in the form of tokens across multiple avenues, such as buying and selling NFTs.
• Calvaria: This up-and-coming gaming platform has created a digital ecosystem that features flagship battle card games that users compete to earn and trade in for other assets.

Metaverse Pros and Cons

The metaverse and its various forms of VR and AR have a ton of exciting potential for shaping the way we game, shop, learn, and interact. Experts predict that the metaverse will continue to grow the world’s connected digital economy and transform entertainment, fashion, education, and other fields. 

The question is: While the metaverse will undoubtedly be a money maker, will it actually add value to people’s lives or potentially take a toll on their mental and physical health? 

Just like the internet itself has had profound positive and negative effects on our lives, it’s likely that the metaverse will too. Let’s look at both the pros and cons associated with the rise of the metaverse.

Metaverse Pros 

• Convenient and cost-effective way to learn: Digital platforms will create great unprecedented opportunities for education from home, no matter where someone lives or their schedule. This opens the doors for people across the globe to continuously learn, creating more equality.
• Supports the digital economy: The metaverse makes it easy to shop for products from around the world. Companies will offer the opportunity to demo products and try them out virtually before buying them. Eventually, “continuity of data” is expected to be utilized where users’ identities, histories, preferences, purchases, and payments will all be stored, tailoring marketing to their needs and making shopping more personalized. 
• Improves communication: The metaverse will assist in virtual meetings, socializing, interviewing, dating, and other forms of collaboration, both professionally and personally. Meta even believes that fake houses and offices will be created in the metaverse in which virtual parties and meetings can be thrown. Users may be able to talk, track each others’ facial expressions, and “touch” one another, all from their own couches.
• Supports remote workers: Working from home may become more convenient and productive than ever before in history, thanks to advances in metaverse technology. Remote teams will be able to collaborate effectively in 3D environments, reducing the need for in-person meetings or travel.
• Money-maker for big companies: Businesses in various fields, ranging from entertainment to research, are predicted to profit from billions of users within the metaverse. Many new professional opportunities will open up, especially those in the tech, graphic design, cryptocurrency, and hardware industries.

Metaverse Cons

• Could potentially reduce social skills: Spending a lot of time in a virtual world makes it even less likely that people will communicate effectively face-to-face. Studies suggest that the more people, especially adolescents, engage in technology-based communication with others, the more their interpersonal skills suffer. Some experts point out that virtual bullying and technology addiction may also be challenges that the public faces.
• Will promote sedentary behavior: Many people already need to be more active. Even greater access to indoor, isolated hobbies such as video games and social media may worsen this problem. There’s concern that 3D gaming may become addictive for young users, causing them to lose connection with people and the physical world.
• May violate privacy boundaries: Some fear the metaverse may be used as a “surveillance tool,” posing risks to users’ privacy. For example, the metaverse may lead to increased “cybercrime” and security risks tied to collection data, such as identity theft and fraud.
• Could expose minors to explicit material: With young people spending more time online, their risk for being exposed to sexual and violent virtual worlds increase. The potential for grooming and online abuse is also a concern.
• Not yet seamless across platforms: We’re far away from being able to seamlessly link different platforms in the metaverse together, mostly because this requires competing companies to cooperate and share users, which isn’t always profitable. Instead of being able to use apps and different offerings in the metaverse collaboratively, making it feel more like real life, for a while, you’ll likely have to use them separately, which takes away from the immersive experience. 

When Will the Metaverse Fully Launch? 

According to a Vice article, a large proportion of people will be “in the metaverse” in some way by 2030. Overall, the metaverse still needs a lot of work because we don’t yet have the data storage bandwidth or hardware requirements to keep it running, as they are still being developed and tested. As wireless technology and hardware advance and become more affordable, fast internet speeds become increasingly accessible, and audiences become receptive to using AR and VR devices, the number of metaverse users will steadily rise. 

The metaverse doesn’t yet exist, but “cyberspace” does. It will take time for the metaverse to reach its full potential, yet there are still plenty of VR and AR opportunities that business owners and leaders can invest in right now and likely profit from.

Tips for individuals, businesses, and entrepreneurs who want to bet on the future of the metaverse:

• Become skilled in technology: Seek out training or employees skilled in careers that are driving VR and AR technologies, such as software engineering and development, project management, software maintenance, and graphic design.
• Prioritize unique online retail shopping experiences: Reach more customers by offering tailored products, clothing, and even real estate that can be “tried on” before it’s bought. For example, virtual tours and virtual try-ons help to gain attention and engagement from buyers.
• Interact with customers via channels they prefer: Communicate more with customers instantaneously using texting, online chats, and social media. Track engagement to determine which outlets best reach and serve your customers.
• Buy meta-related stock: Consider buying stock in tech companies that are at the forefront of the metaverse, such as bigger companies like Meta, Roblox, and Microsoft, or more affordable stocks such as Binance, Epic Games, Unity Software, Sony Group Corp, and even Adidas (which is developing “digital wardrobes”).
• Invest in digital real estate or NFTs: While they’re a somewhat risky investment, NFTs may have a bigger role in the metaverse than they ever have had before. NFTs can be earned from some online gaming platforms and turned into money or other assets.
• Create small virtual businesses: Individuals can make money in the metaverse by gaming, selling products, or creating and hosting virtual experiences such as concerts or art exhibits. You can think of metaverse e-commerce as having things in common with Etsy, where individuals can run their own small businesses from home.

Want to learn more about making money with help from virtual shopping or gaming technology? Check out these articles: “Investors Bullish On Gaming“ and “The Reality of Virtual Shopping.”