Facebook (now Meta) has a bold vision for the future: it wants to build a virtual world that will replace the Internet. At first, it sounds more than bold: many are calling it impossible. Others have tried (Second Life and Opensim come to mind) without success.
However, Meta is risking its future and stock value with a massive $10 billion investment in the metaverse. A tech giant like Meta doesn’t spend that kind of money without the confidence that it will result in a return on investment. So if the idea of a legitimate virtual universe could actually happen, we have to wonder: what is the metaverse for Facebook/Meta? If successful, how will this position the company for the future?
If Meta’s vision for the metaverse comes to fruition, what will that mean for the company’s revenue?
Many pundits still think it’s just a fad that will never catch on, but it’s already caught on. Large corporations are investing millions in the metaverse, and it’s still very much in its infancy.
It’s a Game-Changer
The name change proved that Meta is staking its entire future on the metaverse. This says a lot about the tech giant, which has historically specialized in social media. And while the metaverse does rely heavily on a social component, there is so much more to what it has to offer.
In addition to socializing, the metaverse is (or will be) a place where users can explore, create, learn, and play. It can offer simulated experiences that just aren’t possible in the real world.
A New Source of Ad Revenue
As Facebook, the company’s revenue has been driven by ads from its two social media platforms (Facebook and Instagram) and messaging app (What’s App). Now, Meta still seems focused on ad revenue after its recent patent filings. There are many forms this could take, from the annoying popup interstitials plaguing so many websites to virtual storefronts for real-life brands (the latter has already proven successful in the metaverse).
Meta’s Virtual World Will Put a New Focus on Privacy
Meta’s Facebook platform has drawn harsh criticism for its use (or, as many would consider it, abuse) of user data. Parts of Meta’s vision for their virtual world have heightened those concerns. While CEO Mark Zuckerberg assures us that privacy protections will be paramount (as he has done in the past), experts are warning potential users to be cautious.
So what new heights of information could the metaverse collect about us? For one, this will bring the potential for activity tracking to a whole new level. Platforms like Google Analytics already allow webmasters to track activities on their website. But in the metaverse, your actions and facial expressions can be tracked via a VR headset and hand controls.
For example, if a particular ad, object, or character catches your attention in the metaverse, your quick glance can record the stimuli most likely to catch your attention. This can be used to serve ads that are more likely to elicit a response from you. No such tracking has been announced (yet), but it’s one of many examples of how behavioral patterns could receive increased focus when it comes to advanced privacy concerns.
Also, Meta’s tracking efforts will no longer be limited by other platforms. In 2021, Apple released an update that limits Facebook’s ability to track users (to be clear, it didn’t target Facebook exclusively). There are other additional and browser extensions that also limit Facebook’s tracking abilities.
However, Meta already owns Oculus, the leading name in V/R headsets. Its sales have spiked in light of the pandemic and metaverse announcement. Since Facebook owns Oculus, they can design the headset and its software to track users whenever and however they want. They can also ban apps designed to limit or disable its tracking from the platform.
It Means New Innovations
For better or worse, the metaverse will lead to new innovations and technologies. Meta is already building the world’s fastest supercomputer to help bring its vision to (virtual) life. AI will be a driving force behind this computer’s functions and operations.
A New Way of Conducting Business
Innovation isn’t just about better technology; it’s also about better ways of conducting business. We already learned the role that it can play during the pandemic. Meta has already announced plans to revolutionize online shopping via its metaverse. This could mean new opportunities for businesses of all sizes to sell both real and virtual goods. But Meta doesn’t plan to stop at retail.
Meta has already released the beta application for Horizon Workrooms. This V/R app designed for Meta’s Oculus headsets allows colleagues to meet, work, and collaborate together in a virtual space. Participants can share documents, present seminars, sketch on boards, and host meetings as if they’re in the same room. The environment feels less isolating for remote workers and allows them to collaborate in real-time.
What could this mean for the future? Time will tell, but we can make some predictions. Imagine if a business’s corporate headquarters was completely virtual. No expensive buildings, utility costs, permits, furniture, equipment – the list goes on. It may sound far fetched, but virtual real estate is already booming, and businesses are paying millions for it.
If the metaverse can provide entire virtual workspaces for a small fraction of the cost of a real building, why wouldn’t businesses set up shop online? Especially since the scale of virtual workspaces can increase or decrease much more easily. We already see businesses doing this with many SaaS platforms.
What else does a massive global corporation value besides money? Influence. It’s the abstract global currency that’s largely kept as the best economic secret. Consider how influential social media has been in recent years; Meta’s own Facebook platform has been credited with influencing elections. They know how to influence people, and with the advanced immersion and tracking offered by virtual worlds, they’ll be able to exercise influence in ways that we can hardly imagine.
Conclusion
Ultimately, the metaverse offers a host of opportunities for Facebook/Meta. If they manage to pull it off, the tech giant will reap unprecedented revenue and influence. They will also be able to track new users like never before. But with so many others trying to get in on the metaverse hype (including other tech giants), they face an uphill battle.
