Highlights of Meta's First Metaverse White Paper, Targeting the $80 Trillion Market?

Recently, Meta commissioned the Analysis Group, an international economic consulting firm, to prepare a Metaverse White Paper, which predicts the impact of Metaverse technology on the global economy based on the development of mobile devices.

The report is mainly divided into four parts: the applications and challenges of the metaverse, the similarity between mobile device technology and the metaverse, the use of economic models to study the impact of mobile devices on global GDP, and the study of the potential economic markets of the metaverse.

According to the report, if the metaverse technology is adopted from 2022, it will contribute US$3.01 trillion to global GDP by 2031, of which one-third (US$1.04 trillion) will come from the Asia-Pacific region.

The report mentioned that industry analysts have already estimated the Metaverse's potential value and market size, and they predict that the Metaverse market will be $800 billion to $2 trillion in the next few years. And when the metaverse is widely adopted, the metaverse market will be between $3 trillion and $30 trillion, and the most optimistic estimate can exceed $80 trillion.

1. Unlimited users, open world, digital personality, 9 highlights of the metaverse

While there is currently no unified definition of the metaverse, the report states that the metaverse should have the following characteristics:

1. Metaverse is an extended network of digital space. Users can have VR (Virtual Reality), AR (Augmented Reality), MR (Mixed Reality) and other 3D immersive experiences in the Metaverse, and players can interact in real-time.

2. The Metaverse is a large-scale, interactive, and real-time rendered 3D virtual network world. The Metaverse can be experienced by an unlimited number of users synchronously and persistently.

3. Users can create their own avatar accounts in the Metaverse, and the historical data of these accounts will not be emptied but will be continuously saved. In addition, account identity information, payment methods, communication methods, etc. can be shared across platforms. In other words, the platforms are compatible. Instead of the current situation, each platform (like Twitter or TikTok) needs to register a different account, and these accounts also belong to the company.

4. There are more ways to communicate. In the Metaverse, users can communicate with eyes, gestures, gestures, etc., not limited to typing or voice.

5. Metaverse can support almost all activity scenarios, such as socialising, working, learning, entertainment, shopping, creation, etc.

6. The Metaverse is an open market where enterprises and individuals can freely experience, participate in activities, create content, etc.

7. Users have digital personalities and digital assets in the metaverse. Users can buy a piece of digital clothing on one platform and still "wear" it on another platform, and the digital clothing belongs to the user, not the platform.

8. The metaverse is not an object or a space, but a way in which different technological components are interconnected. These technologies include AR, VR, MR, blockchain, NFTs (cryptocurrency tokens), and more.

9. Metaverse will break the dependence of the Internet on devices and geographical locations, and create an online experience for people to participate in without being physically present through a naturally seamless and immersive experience.

2. Siemens, BMW, and the World Expo are all in use, and the Metaverse has great economic potential

The report also lists the applications of metaverse technology around the world. In the U.S., where metaverse technology is expanding the use of sports, iGYM (an AR game) enables young people with disabilities to participate in sports gaming activities with able-bodied peers. In Europe, industrial companies have adopted XR technology to simplify the process of prototyping, training employees, and coaching work remotely. German industrial manufacturing companies such as Siemens, BMW, Peugeot and Audi have adopted industrial virtual reality training technology, which can save a lot of costs while ensuring the quality of training.

In the Middle East, Dubai is allowing visitors from around the world to view Expo 2020 through AR glasses. Famous South African artist Norman Catherine showcases and sells his own NFT art collection. MTN, Africa's largest mobile network operator, purchased 144 pieces of virtual land in Ubuntuland in February 2022. In Latin America, the Brazilian company MondodX created VYRCH, the first XR platform for online retail shopping.

These use cases all reveal the great economic potential of the metaverse.

3. Drawing on the history of mobile device development, Metaverse GDP may reach 3 trillion US dollars in ten years

Emerging technologies such as the metaverse are not yet in widespread use, and there is a lack of practical and accurate operational data, so the economic impact of the metaverse is difficult to assess. Therefore, the Analysis Group uses the development of mobile devices as an analogy to the development of the metaverse to assess the economic impact of the metaverse.

Mobile devices here refer to mobile devices that are able to access the Internet – such as smartphones and tablets, as well as the infrastructure and related ecosystems that support the use of mobile devices.

According to Analysis Group, the metaverse shares many similarities with mobile devices. Mobile devices have integrated functions such as calls, cameras and mp3 players, changing the way the Internet is connected and experienced. Mobile devices overcome the geographic limitations of desktop computers, allowing users to use the Internet from anywhere. In addition, various applications have been developed on the basis of this mobile device, giving birth to new industries such as live broadcasting, which in turn has changed the way people play, live and work.

The Metaverse also combines technologies such as AR/VR, video conferencing, multiplayer games and digital currency and turns them into new content and experiences. Metaverse further breaks the Internet's dependence on devices and geographic locations and creates an online experience for people to participate in without being physically present through a naturally seamless and immersive experience.

In addition, mobile devices are a relatively new technological product, and there are sufficient data to investigate, so mobile devices are more suitable as metaverse objects for research.

Analysis Group concluded through analysis: Assuming that the market uses metaverse technology from 2022, 10 years later, the GDP generated by the metaverse will account for 2.8% of global GDP; by 2031, the total contribution of the metaverse to global GDP will be It reached $3.01 trillion, of which one third ($1.04 trillion) came from the Asia-Pacific region.

4. The Economist: The Metaverse is the Turning Point of the Information Revolution

The Hype Cycle curve is an analysis method first adopted by the consulting firm Gartner in 1995. Gartner predicts the maturity and evolution of various new technologies and the time required to reach maturity based on its professional analysis and prediction. The hype cycle curve is mainly divided into five stages: the promotion period of the birth of technology, the peak period of high expectations, the trough period of foaming, the bright period of steady climbing, and the peak period of stable production.

Analysis Group mentioned in the report that according to the hype analysis of emerging technologies from 2000 to 2016 by the consulting firm Gartner, most hype technologies never successfully entered the market due to the incompatibility of the public's initial expectations for the technology with the final market demand. This has implications for metaverse technology, and like many technologies analyzed in the hype cycle, perhaps the metaverse will never materialize in the way we currently envision it. Analysis Group says the purpose of the report's analysis is not to predict whether the metaverse technology will succeed, but to measure the potential economic impact of the metaverse.

The development trend of each new technology follows an S-shaped curve. The first stage is the start-up stage with slow development, the second stage is the growth stage with rapid development, and the third stage is the stable stage of maturity and perfection. Over time, the S-curves of different technologies will be superimposed on each other, continuously improving the performance of the product.

"We are at a turning point in the information and communication technology revolution," says technology and economist Carlota Perez. He believes that we are now at a turning point in IT technology in the 1930s. We are about to enter a new era led by emerging technologies such as artificial intelligence, IoT, robotics, blockchain, semiconductors, etc.

5. Let the traditional industries burst into life, and the Metaverse can catalyze the economy

The specific impact of the metaverse on the economy is difficult to determine, so the Analysis Group analyzes the potential impact of the metaverse on different industries from three aspects: direct impact, indirect impact, and catalytic impact.

Direct Impact: The Metaverse will first impact industries that create technology and infrastructure, such as graphics processors, AR/VR headsets, virtual social platforms, blockchain, and more. The metaverse also affects hardware, software, payment systems, and network providers, among others.

Indirect impact: After the infrastructure is built, the Metaverse may have indirect impacts on some industries, such as gaming, social networking, online retail, education, telecommuting, healthcare, manufacturing, etc. The Metaverse can provide technical support for these industries, create new jobs, and benefit these industries.

Catalytic effects: The Metaverse could also have some far-reaching effects that we cannot currently predict with precision. Just as mobile devices have brought new industries such as smartphones, the Internet, computers, live broadcasts, and food delivery, the Metaverse may also create some new industries and have profound and broad impacts on society as a whole. The Metaverse can "catalyze" the economy, increase productivity, accelerate economic growth, and create a much larger impact than both direct and indirect.

6. Metaverse technology is still in its infancy and needs further construction and improvement

While the Metaverse has enormous economic potential, the speed at which it reaches the desired economy depends on infrastructure development, the pace of technology deployment, the usage of the Metaverse by consumers and businesses, etc. The report mentions that we are still in the early stages of metaverse construction and that many of the necessary conditions for the realization of the metaverse are still lacking.

Technologist and venture capitalist Matthew Ball identified three core elements needed to realize the metaverse: concurrent infrastructure, standard protocols, and user introduction.

Concurrency infrastructure is the technology that enables millions of users to synchronize a shared network. Unlike the current internet where servers are connected one-to-one, the Metaverse requires multiple servers to be connected in parallel.

Also, the Metaverse is a large ecosystem that requires large-scale collaboration among many companies. Therefore, the Metaverse needs unified standards and protocols.

After building the metaverse platform, how to attract more users to the metaverse platform is a key issue. Metaverse platforms must provide users with unique value and advantages in order to be promoted by users. If users feel that shopping on the Metaverse is more troublesome than going to the mall themselves, then the Metaverse technology may not be widely adopted.

In addition, the Metaverse also faces other challenges in policy oversight, data privacy, and content security.

Conclusion: There are still limitations in prediction, and metaverse technology needs to continue to develop

The Metaverse White Paper by Analysis Group provides a more comprehensive description of the metaverse's definition, application examples, economic impact, etc. Through this report, we can get a glimpse of the current state of development of metaverse technology.

According to the conclusion of the report, if the metaverse technology develops in a similar way to mobile devices, then in 10 years, the metaverse will contribute 2.8% of the global GDP, and by 2031, the global GDP created by the metaverse will reach 30,100 One hundred million U.S. dollars.

However, this conclusion, based on the metaverse developing in a similar way to mobile devices, is just speculation. Analysis Group also stated in the report that since there is currently not enough "metaverse data" to measure, Analysis Group just used existing tools and data to create an analog for the metaverse to speculate on the future of the metaverse. economic impact. Although imperfect, we can grasp the influence trends of the Metaverse through this transparent framework.

In addition, the Analysis Group also mentioned in the report that the utility of the metaverse matters, how will we actually get there, and crucially, how far is the next phase of connectivity? Like many other previously "hyped" technological innovations, the metaverse may never materialize as currently envisioned. As with the internet and other technologies, the form and shape of the metaverse will initially materialize slowly, and only after reaching a critical mass will its full potential begin to become more concrete. So before it's officially there, and it won't be for a while now. We don’t need to “go all out” on your metaverse strategy, nor should we feel obligated to jump on the NFT train. If we want to make the metaverse a reality, we have to keep working on infrastructure, policy agreements, and more.