Predicting the Impacts of the ‘Metaverse’
The metaverse will result in some significant shifts in our lives, socially and economically. This virtual realm originates from the gaming industry. Hardcore gamers were the early movers.
The metaverse, a virtual copy of the real world, has started to become a reality. The metaverse is an evolution in the way we use the internet. In the beginning, the internet was just a network of static websites filled with text. Then, the content grew to also include graphics and photographs.
Nowadays, it is common for us to enjoy video content on YouTube, Instagram, TikTok, and other platforms. Furthermore, with virtual reality (VR) and augmented reality (AR) technologies, we can enter the more immersive world of the metaverse.
Also read:
> Crypto Scammers Use MLM Network to Lure Victims
The big players are vying to enter the metaverse. Facebook will invest US$10 billion and has changed its name to Meta to indicate its seriousness. Microsoft has bought online game developer Activision Blizzard for $70 billion as one way to enter the metaverse. Alibaba has injected $60 million into Nreal, a company that makes AR glasses, to catch up with Tencent, which leads the gaming industry in China.
The beli putus (direct purchase) transaction model will shift to a subscription model supported by in-app purchases.
The metaverse will result in some significant shifts in our lives, socially and economically. This virtual realm originates from the gaming industry. Hardcore gamers were the early movers. However, with the proliferation of casual games, such as Beat Saber, Population One, and various fitness apps, casual players will account for the bulk of the gaming revenue from the metaverse. The beli putus (direct purchase) transaction model will shift to a subscription model supported by in-app purchases.
From gaming, the metaverse will penetrate the world of work. The Covid-19 pandemic has popularized the practice of working from anywhere. However, videoconferencing platforms, such as Zoom, Google Meets, and Microsoft Teams, have deprived employees of physical and social interaction. This is why Microsoft has started building Mesh and Facebook has developed Horizon Workrooms as a meeting metaverse that enables collaboration with immersive physical and social interaction.
Mothers can hold virtual social gatherings without missing a chance to "gossip" with the intimate feel of the physical world.
The use of the metaverse in the world of work will also encourage its use for personal purposes. The impact of the metaverse network will speed up the adoption of metaverse apps in the personal realm. This is like adopting instant messaging platforms that originated in the world of work. Mothers can hold virtual social gatherings without missing a chance to "gossip" with the intimate feel of the physical world.
Metaverse will turn e-commerce into virtual commerce. Retail companies like Nike and Zara have realized that they must be present in the metaverse, because that is where consumers will gather. In the metaverse, consumers can try products and personalize them without having to visit a physical outlet. This results in high scalability and customer loyalty.
In addition, there will be augmented commerce. Alibaba plans to build a shopping center where consumers can shop using AR glasses to view additional information, such as the ingredients of the foods they buy and recipes to try.
AR technology can also be enjoyed by using smartphone cameras. For example, a real estate agent can use an app that displays the price of a house and the estimated installments, just by scanning the house using a smartphone camera.
Global job opportunities
Metaverse will open up global job opportunities. Experts in the geek economy can work at companies in other countries without having to relocate. The metaverse will allow them to work remotely without losing out on social interaction with local colleagues. Thus, the income will benefit the economy of where they live.
Learning centers with teachers, classrooms, teaching aids, and participants will emerge in the metaverse. In the metaverse, everyone can appear to be in the same classroom. This will significantly reduce the cost of education. With increased skill levels, productivity will increase, salaries will increase, and taxes will increase, and all this will encourage economic growth.
Virtual landowners will lease their land using smart contracts.
In the metaverse, assets such as land, houses, cars, and other objects, including currencies, will be digital. There will be initial speculation before finally shifting to more functional digital assets and utilities. For example, non-fungible tokens (NFT) will shift to clearer utility in the virtual and the real world. Cryptocurrencies are shifting from speculation towards passive incomes through the staking process. Virtual landowners will lease their land using smart contracts.
Decentralized finance
Supported by blockchain technology, the metaverse will encourage decentralized finance (DeFi), where consumers can conduct transactions without the intermediation of conventional financial institutions. DeFi will result in a low-cost economy and higher profits for all parties.
The information symmetry that occurs will encourage a transparent and efficient economy without oligopoly by traditional financial institutions. Frictionless trading supported by payments using digital currencies at market-determined exchange rates will become a reality. All of this creates a more inclusive economy.
The metaverse business model, which is still in its infancy, has created high uncertainty for early investors. However, if it is too late to invest, it will also be dangerous. Therefore, to mitigate risk, companies that invest in the metaverse must find a balance in how much and when to invest, based on the opportunities and competition.
The lack of formal regulation in the metaverse, decentralized business models, and newly emerging utilities will challenge regulators in understanding and anticipating their social and economic impacts. Governments and central banks will find it difficult to regulate the economy in the metaverse because their formal authority in the real world needs to be transferred to the metaverse, which naturally has independence and autonomy.
The metaverse will undoubtedly come to exist and have an impact on the real world. The challenge is how to ensure that these two realms come together for the benefit of all.
Rico Usthavia Frans
RICO USTHAVIA FRANS, member of the Steering Committee of the Indonesia Fintech Society (IFSOC)
(This article was translated by Hendarsyah Tarmizi)
