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It’s October 2021. You just finished flipping an NFT for double your salary after hearing a Gary Vee video snippet about how this doodle is the future of all commercial activity. You glance away from your Robinhood screen to look at the latest news and you see that God King Zuck has announced that his social media empire is rebranding…..from Facebook to “Meta”. He’s putting his money where his mouth is and going all in on the “Metaverse". You quickly google “Metaverse” on one tab while perusing all the domain names that have anything to do with “meta”. This is it. The new platform shift. Technology is going to change forever, just like with mobile. Or maybe it’s like the cloud era. You’re not exactly sure yet (after all, the only thing you know about VR is Beatsaber and Metaverse sounds like a weird defunct Disney attraction), but you know it’s going to be big. Maybe this is the end of history for consumer technology? Perhaps Fukuyama was on to something, he just forgot about the headsets?

Okay, you can snap out of it. We’re back to 2023. Crypto is in its newest winter, the Fed hates easy money, and all the cool kids are talking about AI. So why are we still in our meat suits and why did the Metaverse never show up? What happened to the paradigm shift to end all paradigm shifts? Well, simply put, technology is hard and consumers are not a patient bunch (generally speaking). Paradigm shifts are rarely one specific moment (and very rarely do they involve a rebrand). They usually are a series of incremental improvements, one step farther than the last (one could say it involves standing on the shoulders of giants). With that in mind, what I want to focus on is the bit about technology being hard. I’m quite aware that most people understand that science, software, and hardware are difficult. But I don’t think we ever truly reflect on just how difficult it is. So today, I want to break down the very specific aspects of the underlying “Metaverse” technologies and why our time window for expecting its arrival is not a matter of a couple financial quarters, but of several more years (if not decades) of R&D. So, what happened to the Metaverse?

WHAT IS THE METAVERSE

First, I think we should establish some sort of baseline definition and idea around what the Metaverse is meant to be. To do this, I will be leaning strongly on Matthew Ball’s work and how he defines the concept (you will see a lot of Ball’s influence here since he is probably the most clear thinker on these ideas from a commercial and consumer perspective). Ball defines the Metaverse as “a massively scaled and interoperable network of real-time rendered 3D virtual worlds that can be experienced synchronously and persistently by an effectively unlimited number of users with an individual sense of presence, and with continuity of data, such as identity, history, entitlements, objects, communications, and payments.” Lots of buzzwords in there right? Let’s break down this definition into its components to get down to the heart of it.

This definition starts with the idea of a “massively scaled and interoperable network of real-time rendered 3D virtual worlds”. What is this really talking about? Well, the first bit of it, the “massively scaled and interoperable network” is similar to the idea of the Internet. Massively scaled means it has to essentially be of a global scale. We’re talking available in every continent. The internet’s utility has increased due to more and more of humanity having access to it as consumers and contributors. Similarly, the true value of the Metaverse will lie in its reach and adoption by the global population. If you’re not familiar with the resources required to reach this “massive” scale, read about the underwater cables that make up the foundation of the internet. Interoperability is the idea of a system being able to interact and function with other systems. Again, using the Internet as an example, the world wide web is really more like a variety of local network systems that all communicate with each other in a sort of lingua franca (protocols like TCP and whatnot) to create a larger network that stretches across the globe. All the components behind the Internet are built with the idea of exchanging information with a variety of systems in a consistent manner across the board. This consistency allows the larger network to continue to grow as different parts of it change and emerge. The Metaverse will have to operate in a similar manner, able to be accessed through an Oculus headset as well as an Android mobile device as well as insert XYZ device here. It must be built with a lingua franca in mind. Next is the idea of “real-time rendered 3D virtual worlds”. These buzzwords are probably a little less opaque. Real-time refers to the idea of things happening with no delay (I do x action and y happens without a buffer of time). 3D virtual worlds are the easiest to conceptualize since some of these already exist (most VR experiences could be said to occur in or encapsulate a 3D virtual world). However, it’s important to highlight that the Metaverse is not one of these worlds (same as how Facebook is not the Internet regardless of how much Zuck wants it to be), but it is the environment in which these worlds “exist” unto one another. Much like the internet is a network of networks, the Metaverse should be a world of worlds.

The second part of Ball’s definition focuses more on how this interoperable and 3D rendered network will // should operate and how we will experience it. The focus in the definition is that it should be experienced “synchronously and persistently by an effectively unlimited number of users with an individual sense of presence, and with continuity of data, such as identity, history, entitlements, objects, communications, and payments”. Basically, this network should support simultaneous use and reflect a live and constant experience. This live and constant experience should be the same for an unlimited number of users (total market is essentially the whole world much like the Internet) and include the ability for data to continually be captured and utilized through models & concepts like who you are in this experience (and who others are) as well as the ability to shop, talk to those others, and have a record of these things existing. The important bit here is for all of this to occur persistently. The bar for this persistence is 24/7. There can be no downtime. This is site reliability on steroids. It should be noted there is no example of this out in the wild. A lot of game design is based around tricking you into thinking these things are happening, but there is no actual system out there that can do the things defined so far. Which leads nicely into the next section.

WHAT IS SO HARD ABOUT IT

If you do hands-on technical work in any way, what I’m going to say in the following section shouldn’t come as a surprise. To be clear, all of the qualities I outlined above are not represented in any product, game or experience in the present. The aspects of the Metaverse concept that are generally accepted as defining traits (however loosely) are impossible to do as things currently stand. There is no computer infrastructure or system that can collect and store the amount of data needed to generate and operate real time 3D rendered experiences that provide a globally distributed user base numbering in the billions the ability to engage in commerce and communication. Each aspect of it has an unique set of problems that prevent the current group of companies and organizations from meeting the expectations of the consumers of the world. These problems lie across a variety of disciplines and fields. They require innovation in software and hardware. Some of the issues might be hard stopped by the laws of natural science. Others are simply due to our own societal constraints. The point is that everything we’ve outlined so far is merely theory and turning theory to reality is a much larger leap than some would have you believe.

Let’s start with the idea of the interoperable network. It’s not hyperbole to say that the internet is a modern miracle. Most of what makes it a miracle is not the technologies necessarily, but the coordination and alignment of humans across the world to create and agree upon the protocols that make up what is the “Internet”. These protocols include things like file types, the TCP/IP suite, and other standards that act as the glue that keeps the networks communicating in the same manner. Getting people to agree and coordinate on most things is insanely complex. To do it again for what would eventually be the Metaverse would once again require the type of coordinated work that most people would call miraculous. The issue is the splintered state of the systems that are being used to develop the Metaverse today. There are a variety of rendering engines, file formats, and isolated standards that need to be aligned in order to create interoperability. Anyone that has worked with any sort of team within a larger environment knows that this kind of coordination is uhhhh difficult. The massively scaled aspect of things also presents a lot of challenges. These were hinted at above, but the general gist is that serving the global population in a digital capacity requires enormous amounts of physical resources and infrastructure build out that would also need to solve some of the current issues plaguing the Internet (not all of us are terminally online just yet). Then there is persistence, which requires the massive amounts of compute infrastructure we mentioned already. This infrastructure must enable high bandwidth, low latency, and a continuous connection to the source server. As I have frequently mentioned, there is nothing available to consumers that can do even some of these things at a global scale.

IF IT’S NOT HERE NOW WHEN WILL IT BE

Okay so at this point I think I’ve painted a picture of what the Metaverse is and what makes it actually hard to develop. The Metaverse is not here and does not appear to be happening soon. So, assuming it can happen (which is not a given), when will it happen? Well as most consultants will tell you…it depends. On a lot of things. These things include human factors as well as technological ones. So it’s tough to say. But if we speak at a high level from a timeline perspective (again like most consultants will tell you), I think it’s fair to say that we are speaking in decades, not financial quarters. The tough pill to swallow is that there may not even be solutions to the things that stand in the way of this coming to pass. It will require breakthroughs in hardware like wearables, headsets, and all the other subcomponents that will make up the devices we use to access the Metaverse. We will need to reach levels of coordination and standardization that we haven’t seen since the Internet arrived. We will also need to improve access to key foundational infrastructure in order to provide the level of connectivity that the 3D worlds of the Metaverse require to spring to life. There are so many things we have to get right at the right time with the right people. The bar might simply be too high. This is not inherently a bad thing, unless you recently made a big time bet on this bar not being too high and in some ways, answer to a group of people who think in financial quarters, not decades.

WHY WAS THERE SO MUCH HYPE

The reason there was so much hype is because humans love to hype up new things. Especially new technologies. This is not on its face a bad thing. Our optimism is what leads to breakthroughs. You believe in something that does not exist but you think it should exist and try to will it into existence through your effort and others. These efforts tend to follow patterns of iterative progress exploding into exponential results. These patterns can be thought of as cycles or waves. The recent ones that have led to “disruption” are (as every VC will tell you) the mobile revolution, or the shift to the cloud. Being at the top of these cycles can make people very rich. So, people are always on the hunt for the next one (see crypto). The problem is that these cycles can easily just be fads. It’s hard to find the starting point of the wave. It’s several little steps that appear to turn into a giant leap and it’s tough to see which step turns into the jump. Some people are in this race for the next cycle for individual riches. Others face existential risk if they don’t find this cycle (hello God King). In a world where your strengths have been kneecapped (see Apple and mobile ads) and you are beholden to those very kneecappers on another part of your stack (guess which devices allow Facebook the app to exist in your hands), finding this next shift is the only thing that will allow them to survive and thrive. So yeah, it’s in a lot of people’s best (financial) interests to be optimistic about the Metaverse.

WHAT CAN WE TAKE AWAY FROM THIS

Basically, the Metaverse isn’t here because it is very hard to build (shocker). In fact, we are still at the point where the thing itself is hard to define (even though we did our best). Looking at all the different things that need to go right, It probably won’t be here anytime soon. But, I do think it will be here at some point. I also think the definition will likely shift by certain degrees, but that Ball really got the heart of it with his definition. General ideas to learn from this? Don’t just see what other players are doing and copy them for no reason (Chief Metaverse Officers anyone?). Innovation is great and trying to push for the next break through is what we should all strive for, but it is important not to jump on the bandwagon for the sake of it. Do the research. Read about the underlying pieces that will make up the whole. In the end, we will see which bets succeed and which ones don’t. But at least for now, we can move on to the next (hype) cycle.

Credits:

Matthew Ball is really the only credit needed. Check out his work if you want to dive deeper than my plain english.