Sometimes it seems like every big company CEO has read the same article about the same tech trend, and sent the same email to their team, asking “What’s our strategy for this?!” A couple of years ago there were a lot of emails asking for a 5G strategy, and now there are a lot of emails asking about metaverse.
Answering the 5G email was actually pretty easy, partly because almost no-one needs a 5G strategy at all (I wrote about this here), but also because we knew what 5G meant. We probably don’t know what ‘metaverse’ means. More precisely, we don’t know what someone else means. This word has become so vague and broad that you cannot really know for sure what the speaker has in mind when they say it, since they might be thinking of a lot of different things. Neal Stephenson coined the word but he no longer owns it, and there’s no Académie Française that can act as the tech buzzword police and give an official definition. Instead ‘metaverse’ has taken on a life of its own, absorbing so many different concepts that I think the word is now pretty much meaningless - it conveys no meaning, and you have to ask, ‘well, what specifically are you asking about?”
If you do ask that, I’d suggest that there are two broad sets of things that people might mean when they say ‘metaverse’.
First, the narrow definition is simply that some combination of VR and AR will become the next universal device after smartphones, and become billions of people’s main or only computer. As part of that, both our own behaviour and the services we use will change around AR & VR and converge on new norms, just as they did for mobile. This is Meta’s thesis, and the reason Mark Zuckerberg renamed his company.
On this view, saying ‘metaverse’ is rather like saying ‘mobile internet’ - it’s just the internet, on a new screen. New devices probably mean new platforms, and probably also mean some new gatekeepers (and in the last year Apple has used its gatekeeping power on mobile to painful effect). But it doesn’t fundamentally change the entire nature of the internet - it is still many different companies creating their own businesses and their own experiences in a mostly decentralised and mostly permissionless medium. An app store is still a lot more open than a TV station. In this sense, part of the problem with talking about ‘The Metaverse’ is the word ‘the’, which leads many people to talk as though this will be a completely separate thing unrelated to the internet, and to ask absurd questions like ‘does France need its own metaverse?’ or ‘will there be more crime on the metaverse?’ It’s useful to try replacing ‘the metaverse’ with ‘mobile or ‘apps’ to see whether such questions make any sense.
The real question, of course, is whether AR and VR actually do break out, and reach that scale. People in the space often talk as though this is inevitable and unquestionable, but I don’t think we should be sure. The mistake, I think, would be to presume that because the technology can get better, it necessarily follows that billions (or even hundreds of million) of people will use it.
That is the path that mobile took, and VR and AR do look a lot like mobile in the early 2000s. We had devices with four-line black and white or maybe (in Japan) colour screens, and narrowband speeds, and you had to make the leap of imagination to realise what they would become with five or ten years of Moore’s law and engineering - and then make another leap of imagination to realise what that would mean. A lot of people in tech and telecoms thought mobile Internet would be big, but almost no-one realised that everyone would use it, nor that this would become the new central paradigm of consumer tech and replace PCs. You needed to see both parts to realise what would happen - that the tech would get better, and what that would change.
Equally, VR today has devices that point to a lot of potential but are clearly not yet ready to go to a billion people, and we also have a roadmap for what a decade of Moore’s law can do to make them better. This is the thesis at Meta - better displays, better sensors, and more work, more engineering and a lot more money will take us to an iPhone moment, in, say, five to ten years.
That roadmap is all very well in itself, but then there’s the other imaginative leap - once we have those much better devices, what will it mean? Making a device better does not necessarily make it universal. Most obviously, we’ve been applying Moore’s Law to games consoles for 40 years or so, and they’ve got a lot better but most people don’t care. A PS5 is objectively amazing, but the global installed base of games consoles is flat at only about 175m units and it should now be clear that adding even more polygons - another decade of Moore’s Law - isn’t going to change that. Most people simply aren’t interested in that kind of experience no matter how much Moore’s Law Sony and Microsoft throw at them.
At this point, another deterministic argument often appears: that VR is more immersive, and the direction of travel of tech is towards greater immersion, and so once VR is good enough (graphics, weight, display, sensors etc) to delivery that entirely immersive expense, it will automatically break through to the same universal adoption as smartphones.
Immersive is an interesting word, though, because I think there’s another and more compelling path to think about: that the direction of travel has been towards less immersive. Is a smartphone really more ‘immersive’ than a PC or a giant TV? I think you could argue that the move from command line to GUI to smartphone is a move towards less immersion and a much more casual, fluid, accessible, pick-up-and-put-down kind of experience.
In other words, do we really want to climb into a computer? We can’t know this, anymore than we could know whether everyone would buy a smartphone and would’t buy a console, but we can think about what those cases might mean, and one could see smartphones as a victory for towards less immersion, and more accessibility - broader, not deeper, and the opposite direction to VR. AR, meanwhile, is the opposite side of this - you’re not shutting yourself off from the world, yes, but you’re also turning the Internet from something that’s controlled and held in your hand or put in your pocket to something sprayed into the world around you. Will we want that? Maybe, maybe not. Does AR take over, or end up as the new smart watch?
A parallel problem, that is perhaps even harder to predict, is that when we moved from desktop to mobile we swapped screen size for portability, UX and sensors, but we were still in 2D. Text is still 2D. Moving our computing from 2D planes to 3D objects is a quite different thing and I think much bigger thing to changing the size of those 2D planes and putting them in our pockets.
Now, one could easily respond to this by imagining someone in 1982 or so saying that spreadsheets or databases worked fine in character mode, and would not benefit from colour or a GUI (“number are black & white!”). But we can also look at pen computing, which I think we all understand was mostly a dead end, or at best a niche. Typing is generally better than writing (yes, with some exceptions), and demos of drawing are cool, but most people don’t draw for a living. Equally, VR demos of industrial designers or heart surgeons looking at 3D models are cool, but most people’s work isn't in 3D either. Again, this might be like dismissing colour, but nonetheless it’s a different character of change. And every time I see a VR or AR concept showing huge virtual screens floating in space, I think that the future of software is not about seeing more rows in my spreadsheet at once - the future is not seeing it at all, and having an ML engine that builds it for me. This is like printing out our emails.
We can’t know the answer to this in advance. A lot of very clever people did not realise that mobile would replace PCs as the centre of tech (indeed, some people still don’t understand that’s happened), so check back in a decade to find out. But the test is that for VR and AR to matter, we need to do things where 3D matters, whereas mobile did not have to create mobile things. And that takes me to a second definition of ‘metaverse’.
If the narrow definition of ‘metaverse’ is that VR and AR will be the next smartphone, the broad definition is that there’s going to be a whole new internet. Our experience will be 3D, but much of that will be layered onto the real world as we see it through glasses. Games will become a much larger part of daily life - instead of the current split between a few hundred people playing deep and rich AAA PC and console games and several billion playing much lighter-weight smartphone games, Roblox and Fortnite point to a growing middle ground of persistent, open, accessible and expressive environments that are much more about social and identity than games per se, and that can become platforms and ecosystems for developers. Many of these experiences will blur into each other, and digital goods (skins, avatars and other models of self-expression in digital form) will be portable and interchangeable between these worlds, rather like the characters in Wreck-it Raph could pass between games.
I wouldn’t necessarily claim that any given person saying ‘metaverse’ means all of this, and other people would probably add plenty more ideas, but that’s the point, and indeed the problem. This is an attempt to imagine ‘what it would be like’ if we all spent most of our time wearing displays that could put anything into the world, or place us into another world, when none of this will happen for five to ten years. That’s a recipe for handwaving.
This is perhaps why ‘metaverse’ tends to accumulate and incorporate pretty much any random ideas that may be floating around in tech, like a Katamari Damacy ball rolling down Sand Hill Road (or the Cannes Croisette) picking up everything in its path. Portability sounds cool (never mind what it means to bring a tank into a chess game), so the metaverse be about portability. NFTs were the hot thing earlier this year, so all those skins and avatars you buy will be on the blockchain. Fortnite had a moment, and then Roblox, so those are the Metaverse. And if you don’t think VR will break out, never mind - maybe you’ll be able to do the metaverse on your phone? Sometimes ‘metaverse’ can feel like a catalogue of everything and anything cool that might happen in tech in the next decade - which, again, makes it hard to know what anyone saying it has in mind, if indeed they care.
Stepping back, I’m just about old enough that all of this reminds me of the phrase ‘information superhighway’, from the early 1990s. Imagine it’s 1992, you work at the MIT MediaLab, and you’ve realised that tens of millions of people have a PC now, and that in the next decade a lot more people will get one, and they’ll all be connected together with networks of some kind. What would that be like? It sounds exciting! So, you get a whiteboard and start writing - words like interactivity, convergence, video, multimedia, graphical user interfaces and fibre optics. You fill the whiteboard, and draw a box around it and label the whole thing ‘information superhighway’. Who will build this? Well, AT&T, Viacom, Disney, the BBC, NewsCorp and the New York Times Company. Maybe they’ll hire Microsoft, as a contractor. It’ll be great for newspapers - they can send their daily edition to your interactive TV and save a fortune on printing.
The thing is, all of that happened, more or less, but not like that and not from those companies. And the most basic change was that the internet was decentralised and permissionless. Today we talk about and worry about Internet gatekeepers, but their power is entirely different to the absolute control of a telco or cable network. The internet meant you didn’t need a carriage deal. Anyone could launch a service on the internet without getting a meeting in New York or LA. You couldn’t buy it, and no-one was in charge.
The internet was organic. No one person or company could decide how it would work or what it would look like: it was created by everyone.
And so when people start making highly specific predictions about how an entirely new thing will appear, a decade into the future, and explain how it will all work, that feels very inorganic. This isn’t how tech works anymore. The problem with this view of ‘the metaverse’ is not so much that there are huge practical problems in making assets portable between totally different types of game, but that you really can’t predict any of that in advance.
Pulling on this thread a little further, people talking about ‘the information superhighway’ tended to extrapolate forwards from their current market structures (“let’s buy it!”), but a lot of discussions of ‘the metaverse’ do the opposite: ‘metaverse’ is often a sort of fantasy world of projection and displacement. It reminds me of the ideal republics that Enlightenment philosophers used to invent, in which they describe an elaborate imaginary constitution in an imaginary country. Where the philosopher said "The king will be elected for a term of 18 months and will be wise, impartial, celibate and live in poverty” now we hear “in the metaverse all data structures are interchangeable and there are no gatekeepers.” You imagine a world in which everything that annoys you about the current structure and workings of the tech industry has gone away, instead of engaging with the reasons they’re there (Web3 can suffer from this a lot as well).
Going back to the mobile internet in 2002, many of us knew that this would be big, almost no-one thought it would replace PCs, and only a crazy person would have said that the telcos, Nokia and Microsoft would play no role at all and a has-been PC company in Cupertino and a weird little ‘search engine’ would build the new platforms. So be careful building castles in the sky.
Now, we still have that email from our CEO, asking for a metaverse strategy. What do we say? Well, what was our mobile strategy in 2002, or 2005? Had we closed down the WAP site yet? The numbers were small and almost no-one was doing this. We’d also just wasted a bunch of money on a Second Life island where the only visitors worked for us, our competitors or McKinsey. We were making good money licensing our IP for polyphonic ringtones, but we didn’t know how big mobile would get and we didn’t know it would be totally transformed after 2007 and nothing we were working on would matter. But we were there, learning and experimenting, and thinking about what it might become, while knowing that might not be much. That was still the right strategy.
Benedict Evans is a Venture Partner at Mosaic Ventures and previously a partner at a16z. You can read more from Benedict here, or subscribe to his newsletter.
