Depending on who you ask, the metaverse is either the promising next frontier of the internet or the most over-hyped phenomenon since New Coke.
There is no question the term ― still loosely defined and difficult to categorise ― is in a hype cycle.
"With its potential to generate up to $5 trillion in value by 2030, the metaverse is too big for companies to ignore," McKinsey crowed last month, touting its metaverse market report. By the US consulting company's estimates, more than $120 billion has been invested in metaverse projects so far this year.
The vast sums of money and deluge of talent pouring in to build the metaverse may mean this connected virtual world will realise its potential ― we are still in its earliest days, after all ― but critics argue that low user growth on some of the biggest platforms, ugly interfaces and a "tech bro" influence are all throwing cold water on this promising new age of the internet.
It all leads to one question: can the metaverse outlive its hype cycle?
What is the metaverse?
First, the basics. The metaverse bridges physical and virtual worlds, allowing work, learning, playing and socialising to happen in a more realistic environment than what most of the web currently offers.
It is difficult to strictly define the metaverse because some would argue that being in a Zoom meeting counts as an interaction in the metaverse. After all, you're in a virtual meeting space connecting with fellow human beings. It hits the minimum barrier of the definition: connecting the physical with the virtual.
The way we constantly scroll and opt into our devices rather than interact with the real world means we are, in some ways, immersed in a virtual world.
"We already live in the metaverse," Alex O'Byrne, the co-founder of We Make Websites, wrote in a recent post to his technology blog Web2Boomer. "That is, a world where we use the internet as a single, universal and immersive virtual world."
But others argue that's not quite up to scratch.
"The metaverse is Zoom on steroids," Clyde DeSouza, a creative technologist based in the UAE, told The National. Mr DeSouza is a proponent of an immersive metaverse that goes beyond squares on screens. Instead, the metaverse is an interface that connects people to other people in a fully tech-enabled world seen through the lenses of Meta's Oculus or Apple's rumoured augmented reality headset.
Sam Hamilton, a creative director at Decentraland, one of the first and largest metaverse development companies, said that the metaverse is "a further iteration of what we already have" and that what we already have "is terrible".
"We spend days staring at small screens scrolling with our fingers pressing 'like' to try and show some affection to friends," he told The National.
Growing up, he read Neil Stephenson's Snow Crash, the 1992 dystopian novel often cited for coining the term metaverse, describing how avatars become proxies for humanity's social standing and wealth, and some opt out of the physical world entirely in favour of living in a virtual reality.
But for Mr Hamilton, the book got him thinking about how we would have more human experiences in a digital world, which is a more optimistic view of how we might relate to our virtual selves.
"I think, ultimately, that's what everybody is looking for in the metaverse," he said. Decentraland is built for the web as we know it and can be accessed on any browser, not as a three-dimensional virtual world. But Mr Hamilton said that is temporary.
"Eventually we're going to have bodysuits or head implants or wherever the technology takes us, to a fully immersive experience. We certainly aren't there yet but we are making the building blocks of the future."
How popular is the metaverse?
For companies that are touting themselves as metaverses ― whatever your definition ― like Decentraland, The Sandbox and Cryptovoxels, they are so far reporting very low monthly active users compared with their counterparts in gaming.
Derek Strickland, a gaming editor, dug into the number of monthly active users earlier this year. Decentraland has about 300,000, The Sandbox 30,000 and Cryptovoxels counted less than 25,000 visits to its most popular digital land parcel.
PlayStation, by comparison, had 111 million monthly active users and Roblox attracts nearly 50 million users every day.
Who is building the metaverse?
Looking at this adoption rate, it is no surprise then that investment is being poured into gaming more specifically, rather than metaverse platforms alone. This is perhaps one way the metaverse will survive its own hype cycle: by getting out of its identity crisis and becoming a massive offshoot of the gaming industry.
One of the world's biggest venture capital firms, Andreeson Horowitz, has said that "long term, we believe games infrastructure and technologies will be key building blocks of the metaverse, an opportunity that dwarfs the current $300 billion game industry itself".
The California VC announced a $600 million fund in May to invest in game studios, whose players make user-generated content, as well as social apps like Discord that help gamers build communities and in platforms like Twitch where millions tune in daily to watch creators' livestream video.
Andreeson Horowitz is also investing in the infrastructure to build games, based on its conviction that the "metaverse will be built by games companies, using games technologies. From content creation to multiplayer enablement to virtual economy management and live ops, the games industry has already solved many of the problems that need to be solved to create the metaverse".
The other major investor in the metaverse is Meta, the company formerly known as Facebook.
Earlier this year Meta revealed the billions of dollars it is spending to build a 3D virtual world as it searches for its next area of growth, placing a huge bet on what Mark Zuckerberg has declared “the successor to the mobile internet”.
The company’s Reality Labs, which develops augmented and virtual reality-related consumer hardware, software and content, lost $21.3 billion in the past three years. And Mr Zuckerberg said he expects the company to continue to lose money as it builds its metaverse over the next several years.
Where do NFTs fit into the metaverse?
While it remains to be seen what will come of these enormous investments from major incumbents like Andreeson Horowitz and Meta, so far the technology geeks are underwhelmed.
"I’m not impressed with what the 'crypto bros' are doing to the metaverse ― degrading it to nothing more than pixelated NFT galleries with blocky avatars running around on Minecraft-like terrain," Mr DeSouza, the tech evangelist in the UAE, wrote in a recent blog post.
Non-fungible tokens are seen by some as the foundation for providing proof of ownership for all things in a metaverse.
NFTs are unique tokens on a blockchain ― a public, distributed ledger ― that confer ownership rights to the individual or organisation that has it. The digital item could be any number of "things", but amount to pixels being marketed as outfits, art and property.
To Mr DeSouza, this vision of the metaverse is a highjacking by the Web3 community, which wants to overlay principles of decentralisation and an embedded payments infrastructure linked to cryptocurrency.
"Every interaction has become a transaction," he said. "What we have right now is the cryptoverse and the cryptoverse is not equal to the metaverse."
The lack of inclusivity, the pay-to-play or even play-to-earn models are "not the metaverse". He would like to see immersive experiences and connection, rather than being immersed in the consumption of various digital things.
Where to next?
For now, being immersed in a metaverse is still very difficult. Working, in particular, is a tough scenario.
A team of researchers at Coburg University, the University of Cambridge, the University of Primorska, and at Microsoft Research set out to quantify the outcomes of a 40-hour work week in virtual reality.
Rather than experimenting in a virtual world as they hoped it will be, the set-up relied on tech that is widely available to consumers. They used a Meta Quest 2 headset and a Logitech K830 keyboard with an integrated trackpad. The same subjects did the same work in a conventional PC environment for comparison.
The test subjects reported a 35 per cent increase in work task load, 42 per cent more frustration, 11 per cent more anxiety and a 48 per cent increase in eye strain. Productivity was rated as 16 per cent lower and well-being 20 per cent lower. Two test subjects did not make it through the first day, dropping out because of migraines, nausea and anxiety that they attributed to the working environment.
Of course, this is how it is to immerse oneself in a virtual reality today. For those building the metaverse, they do believe it is going to get much, much better. But for now, even Mr Hamilton, of Decentraland, advised not to rush in.
"We just don't know where this will end up," he said. "They shouldn't rush into it just because it's really hyped right now. That's not necessarily a way to do things."
Additional reporting contributed by Arthur Scott-Geddes.