Thursday, June 20, 2024
28 C
Brunei Town

The next big thing

Danial Norjidi

Two reports were recently released pertaining to the future of the metaverse by the World Economic Forum’s (WEF) Defining and Building the Metaverse initiative, a multi-stakeholder initiative to develop and share actionable strategies for creating and governing the metaverse.

One of the reports is a governance briefing paper titled Interoperability in the Metaverse and emphasises the importance of removing friction for users, while the second is a value creation report titled Demystifying the Consumer Metaverse, focussing on consumer applications, foundational technologies and potential pathways to economic value and growth.

A WEF press statement describes the metaverse as “an immersive, interoperable and synchronous digital world” that “represents the next era in the Internet’s development”.

“While its precise definition is still being debated, the metaverse is already forecast to become an USD800 billion market in 2024. Unlocking the potential of this new field requires coordination of technology developers, corporations, governments and civil society.”

The WEF shared that it has convened experts from a broad range of fields to focus on two workstreams related to the future of the metaverse: governance and value creation. The statement added that future workstreams will focus on two additional governance-related themes: privacy, safety and security; and identity. The value-creation track will issue additional outputs focussed on other industries and the social implications of the metaverse.

Head of Media, Entertainment and Sport at WEF Cathy Li said, “The metaverse is the next version of the Internet and it is critical that it’s built by all, and for all. These two outputs reflect premier work on the metaverse involving such an extensive set of stakeholders and leaders, demonstrating the unique value of public-private partnership in metaverse development.”

According to the Interoperability in the Metaverse report, interoperability in the metaverse can present enormous opportunities and value for frictionless experiences, development and economies.

It highlighted that frictionless experiences enable users to move across and between the physical and digital world with relevant data, digital assets and identities. “This could facilitate greater consumer engagement but also provide efficiencies in enterprise, as well as industrial applications.

“The standardisation of tools and both the formation and adoption of uniform development practices resulting from interoperability could allow stakeholders to benefit from frictionless development – or network effects that provide efficiencies and cost savings across consumer, enterprise and industrial interaction paradigms.

“Frictionless economies allow for greater access, marketplace engagement through healthy competition, transactional efficiencies and trust if interoperability balances privacy, security and safety. Such new market opportunities will be able to make use of existing economies of scale while providing new potential revenue streams, access to new audiences and possible points of connection for enterprise partnerships and industrial logistics.”

The report explained that, to achieve this frictionless state, good system-wide interoperability of the metaverse should consider interests such as privacy, security and safety. It highlights that, given the borderless nature of the metaverse, multistakeholder and multilateral collaboration will be required to reach consensus on design choices, best practices, standards and management activities.

To enable responsible metaverse interoperability, the report underlines that stakeholders must consider technical, usage and jurisdictional aspects.

“Technical interoperability design addresses topics such as network constraints, asset ownership, intellectual property protections, payments, identity, data privacy and security concerns at both hardware and software levels,” said the report.

“Meanwhile, usage interoperability keeps users at the centre of design, creating the metaverse globally, inclusively and across demographics to ensure equitable experiences.

“Finally, jurisdictional interoperability must include best practices and standards for the entire data supply chain and across localities, industries and nations.”

In addition, the second report, Demystifying the Consumer Metaverse, stated that the metaverse is expected to have a wide-ranging impact on consumers’ attitudes and behaviours, impacting how, where and when they will want to play, learn, earn and socialise in their existing reality or newly established augmented and virtual realities.

It noted that, consequently, organisations will need to redefine their brand image, shift their relationship model with consumers and change the way they monetise products and services in order to create true consumer value.

“They will likely move from offering products and services to being metaverse participants and providers, introducing engaging experiences and building communities in order to create meaning and fulfilment for their customers.”

Carrying the aim to give a holistic introduction to the consumer-facing metaverse and its economic opportunities, the report addresses the key question: What makes up the metaverse and how can organisations and individuals create equitable economic value through it in a consumer context?

The report draws on expertise in retail, media and entertainment, consumer packaged goods, real estate, banking and communications, as well as technology innovation, web3, environmental, social and governance (ESG), and economics experts, and presents an interdisciplinary view of the end-user experience layer of the metaverse, capturing the present technology landscape and related economic models that may pave the way for future growth.

Among the paper’s key insights is that “while it currently is difficult to define the metaverse, its main distinguishing components are highlighted to be social interaction, identity, multilateral value exchange and distribution, and a degree of immersion”.

Further, it stated that, “Impacted by wider society – organisations and individuals can take on one or multiple roles in the metaverse, from being participants to creators or providers.”