The metaverse has been hard for investors to avoid.
It has gone from an obscure, theoretical idea to being variously described as everything from the evolution of virtual reality to the next iteration of the internet.
Over the past year, we have seen a slew of global brands and companies announce their entrance into the metaverse.
The most notable came from the Silicon Valley tech giant formerly known as Facebook, which rebranded itself as Meta Platforms.
Other big tech companies have also embraced the metaverse. Microsoft recently made its most expensive acquisition ever, buying game developer Activision Blizzard for almost $70bn (£56bn).
This acquisition was seen as the start of Microsoft’s foray into the metaverse.
However, it is not just technology companies moving into the space. We have also seen Nike acquire the digital studio RTFKT – a leader in creator digital artefacts.
Major fashion companies are creating their own metaverse capabilities. Meanwhile, Disney has patented the technology to create a digitally augmented version of its theme parks.
Hyundai has launched a metaverse space called Hyundai Mobility Adventure, which allows users to “experience Hyundai Motor’s mobility offerings in the form of avatars”.
Defining the metaverse
But what is the metaverse? Meta is a Greek word that is used as a prefix for when something transcends itself.
The term metaverse, therefore, suggests a world beyond our current one – a new digital or virtual world.
The first recorded use of the term was 30 years ago in a 1992 novel by Neal Stephenson called Snow Crash.
The author foretold a future where users connected to a VR space using the internet and interacted with objects and other human beings through augmented reality (AR). Players were represented by avatars, with computer programmes (software agents) acting on their behalf.
So, put succinctly, the metaverse refers to a digital world in which everyday experiences such as working, socialising, gaming and shopping take place.
According to Bill Gates, in two to three years all virtual meetings could be held on the metaverse.
Another way to understand the concept of the metaverse is to think of it as the latest development of the internet.
The first iteration of the internet was in the form of read-only static webpages (Web 1). This soon moved to interactive read and write and social networks (Web 2).
The metaverse, it is argued, is the latest development in the evolution of Web 3. When ‘complete’, it will involve a series of decentralised, interconnected and increasingly realistic 3D virtual worlds, each with their own functional online economies.
Size of the market
However, most importantly, projections suggest that the metaverse is on track to become a growth area that investors cannot ignore.
A January 2022 report by Gartner suggests that by 2026, 25 per cent of people globally will spend at least one hour a day in the metaverse for work, shopping, education, social media and entertainment.