The Metaverse is a shared virtual world you can access via the internet. Visitors get an immersive experience with the help of augmented reality and virtual reality technology. It is a digital world in which advanced human-computer interaction involving hardware and software occurs. The Metaverse is in its early stages of evolution. It is a vibrant world full of innovation, opportunity, and growth.
The metaverse market’s true potential is still being discovered. Still, various industry reports from Bloomberg and Yahoo finance estimate it is growing at an average CAGR between 13% to 44%. The metaverse market has rapidly grown in the last two years (2020 and 2021). It is anticipated to maintain an average CAGR of 13.1% until 2024.
Google, Apple, Microsoft, and Meta will be developing more capable VR/AR headsets. The Seoul Metropolitan Government has announced work to build a virtual communication ecosystem with economic, cultural, tourism, and civic services. They are calling this project Metaverse Seoul.
Google acquired Canadian company North. The company brings with it augmented reality hardware and software capability. Apple is reported to be exploring acquiring a headset company. This ability will enable entry into the Metaverse. Microsoft Hololens, Facebook’s, now Meta’s, Oculus, PlayStation’s VR helmets, Epic Games video games, Alibaba Ali Metaverse, and others seek to leverage the opportunities in the Metaverse world.
In this hot market, geopolitics, too, is playing its part. The People’s Republic of China (PRC) seeks to compete with America and the Western world. It is competing to leverage the Metaverse’s abilities in industry and business. It has constituted a committee to promote and develop applications for the Metaverse. Alibaba and Tencent are developing applications and building products that will help them dominate the emerging market in the Metaverse.
Many of the Metaverse services are targeted at the gaming-related audience. Software and hardware services required by this segment are being developed. Gaming gets between 50% to 60% of revenues in the Metaverse.
Bloomberg Intelligence estimates gaming services industry revenues alone will show a CAGR of 8.1 percent. Its market share will touch $ 170.1 billion in 2022. The average CAGR of the live entertainment industry is projected at 24.31 percent from 2020 to 2024. Its market share will reach $131.6 billion in 2022.
Two of every five people across the world are into gaming. Nezoo reports that there were 2.69 billion gamers globally by the end of 2020. This segment has been growing at 5.6 percent year on year. Gaming revenues for 2020 have reached $159.3 billion. China and the US are the two largest gaming markets worldwide. ESA, 2020 reports that while the 18 to 34 age group accounts for 38 percent of gamers, 6 percent of 65 years and above are also in the US. Both men and women are into gaming, with the weightage split in favor of males.
Brands want to leverage the gaming segment. Adidas released NFTs and purchased land on the Sandbox VR – a virtual real estate company. Andrew Kiguel, CEO of Tokens.com, has purchased real estate in the fashion district of Decentraland, paying around $2.5 million for the space. He plans to build towers in Decentraland’s Crypto Valley. He wants to rent out office and retail space. Another digital real estate developer and investor in the Metaverse, Republic Realm, has bought 259 parcels of Decentraland to turn it into a virtual shopping district.
Gucci has partnered with game maker Roblox to sell items. Balenciaga will be selling its clothing that can be purchased in virtual stores on Epic Games. Louis Vuitton has created Louis the Game game to showcase its high-end brand.
Other companies leveraging gaming to build their brand include Red Bull, Puma, PepsiCo, Manchester City, KFC, Pizza Hut, AB InBev, etc.
A few companies that have invested heavily in this space are – Decentraland, Sandbox, Epic Games, and Meta. Decentraland has a 3D VR platform with measurable real estate. Sandbox has a marketplace with user-generated crypto and NFT assets that you can buy and incorporate into your VR world. Meta (formerly Facebook) is experimenting with its Oculus products.
Bloomberg Intelligence estimates that by 2024 there will be 1.73 billion VR users. By 2024 revenues from VR games will touch $ 2.4 billion, and there will be an investment of $17.6 billion in AR/VR tech.
3D AR and VR technology have been extensively applied to gaming. Fifty-nine percent of industry experts surveyed and reported on XRtoday.com have said gaming will dominate VR investments for the next few years. The majority also expect the highest potential to benefit from VR amongst all use cases comes from gaming.
Metaverse, simply put, is a virtual world where all activity that today is being done in the physical world is being conducted virtually. Bloomberg and Yahoo finance estimate that the Metaverse market is growing at an average CAGR between 13% to 44%. Mark Zuckerberg believes that the Metaverse will become a place where people work, eat, play, and interact in the digital world that is always on. The Metaverse is in its early stages of evolution. It is a vibrant world full of innovation, opportunity, and growth.