The metaverse, purported to be an immersive technology that will change the way humans interact, has attracted significant attention just in the past year. Goldman Sachs analysts predict that the metaverse could be an $8 trillion opportunity, driven by a new wave of technological innovation across augmented reality (AR) and virtual reality (VR), in addition to the expected growth in global, digital, and virtual economies.

Despite ambitious forecasts like this, uncertainty remains over the metaverse’s revenue potential, as well as the impact that technology, privacy concerns, and shifting consumer preferences will have on the outlook for this burgeoning market.

A common understanding of the metaverse will evolve over time. When people refer to the metaverse, they might actually be talking about components of it, such as AR cloud, virtual worlds, Web 3, non-fungible tokens (NFTs), or bitcoin.

Looking at the Metaverse

It’s probably best to look at the metaverse phenomenon in different stages. You could call our current stage the adverse, which is the ad-funded internet. In a virtual world, everything we do costs us time, money, or privacy.

As we scratch the surface of the metaverse, you could also call this the dejaverse phase, witnessing things we’ve seen before, such as Second Life. Roblox has also been around for years. Meta (Facebook) is rebranded, but not new.

The stage we’re just beginning to enter is the transverse, where companies get together to build standards. There’s a movement afoot to make our identity standardized and more private.

These first three phases lead up to what people have traditionally called the metaverse. But perhaps it’s more accurately described as the meterverse, a world in which we are charged for just about everything we do.

If we move the target further, we get to the exoverse. Companies like Niantic and Google are already building that. Google Maps is an example. It’s about mapping the outside world. Niantic is also talking about a real-world metaverse. REI, a U.S. outdoor sporting goods company, is getting into AR. It wants to marry a low-tech environment — camping with maybe a stove and a tent — with AR for an immersive experience that goes beyond that.

Finally, a little more esoteric, is the esoverse: from eso, meaning within. It’s using technology to explore our inner selves. You’re beginning to see some of that with meditation apps. I think that we can expect a whole world of being able to actually delve into what it means to be human.

All of this leads to the holiverse; it’s about being complete or whole, as in holistic. It is the integration of all these things.

It’s difficult to pin down timing and when transitions occur, but a commonly defined metaverse might happen in the next five years. The exoverse is happening now, but it won’t be mature until everybody has a common device, so that’s more like six or seven years. Esoverse is hard to predict, but in 10 years it will start to crystallize.

The Metaphysics of the Metaverse

As it evolves, the metaverse is getting metaphysical. As creators in a digital world, we empower ourselves with the kind of superpowers that exist in fiction. Those superpowers are “God-like,” in terms of being able to control the world around us and being able to be present in multiple locations at the same time.

If you had to come up with a succinct way of defining the metaverse, it’s a future internet we inhabit with digital avatars or holograms. The most important aspect of that inhabiting — Mark Zuckerberg calls it the embodied internet — is it becomes fully interactive.

Think about Facebook today. You don’t really see people directly; you’re seeing pictures and posts about people, but you’re not seeing the people first-hand. That metaverse doesn’t exist yet. Metaverse development also requires solving hard problems, including fundamental physics issues. What comes out between now and five years from now will be preliminary.

The Technology of the Metaverse

As it evolves, we’re also seeing a push toward decentralization as a reaction to how pervasive government and corporations are in our lives. We want democratization, and no one has solved that problem.

Facebook invested $10 billion in metaverse development. That’s an expensive sandbox. Is it still possible for the metaverse to become democratized rather than dominated by well-capitalized businesses? Big companies want a return on their investment, so we’re probably in for an immediate future of walled gardens and centralization in the way the early internet was with CompuServe and AOL.

Once everybody has practical devices — affordable AR, VR headsets — you might see advancement. As soon as every corporation has devices and they’re interoperable, you’ll likely see the open web technologies proliferate just as they did with the internet in the ’90s.

Privacy in the Metaverse

Metaverse technologies require deep knowledge of individuals. If that same technology is used to exploit us, we have to shut it down. My hope is we can get rid of these invasive business models by the time the technology proliferates.

The technology with the most promise of Web 3 technologies is self-sovereign identity. It inverts the problem of privacy so each of us keeps our own data instead of giving it to corporations.

One interesting development is zero-knowledge proof. It allows a website or merchant to validate you, based on factors such as age or creditworthiness. You can pursue a transaction without giving away personal information. You maintain your own data and through a zero-knowledge proof, they learn nothing about you except the narrow information they need for validation.

Safety and Regulation in the Metaverse

Even putting ads and privacy invasion aside, regulators need to grapple with the long-standing issue of safety in virtual worlds. When you enter a virtual world such as a multiplayer game, it’s not necessarily safe. Some people do things that are criminal or at least highly antisocial in the physical world. You’re relying on private companies to police themselves, and they can’t always prevent fraud, harassment, or worse. Relying on AI is not sufficient. It’s an urgent government regulation issue, and what we can regulate now is the business model itself.

I may sound like a pessimist — and I have a lot of concerns — but long term I’m optimistic. All technologies should be about empowering people: empowering us to have better lives and to improve the world around us. That’s the reason I’m excited about AR, even more than VR. AR is about understanding the world and our role in the world. That can help us have better interactions and improve business and personal relationships. That’s an example of what I’m hoping to unlock.

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About Avi Bar-Zeev

Avi Bar-Zeev has been a pioneer, architect, and advisor in AR/VR/MR for nearly 30 years, behind the scenes in the world’s largest tech companies and at large. Most notably, he helped found and invent HoloLens at Microsoft, assembling the very first AR prototypes, demos, and UX concepts. He also built the first prototypes for what is today called the AR cloud.

At Amazon, he helped launch PrimeAir, as well as design UX for what is now called Echo Frames (no-display, wearable glasses). From 2016 to 2019, he helped Apple advance its own undisclosed projects by prototyping experiences and hardware while exploring new use cases to validate hypotheses.

In 1999, he co-founded the company behind Google Earth and subsequently helped define Second Life’s core technology. Back in the mid-’90s, he worked on groundbreaking VR experiences for Disney, including Aladdin’s Magic Carpet VR Ride, the Virtual Jungle Cruise, and Cyberspace Mountain, serving as technical lead for many.

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This industry article was adapted from the GLG Roundtable “Metaverse Opportunities Amid a New Era of Digital Disruption.” If you would like access to events like that or to speak with experts like Avi Bar-Zeev or any of our approximately 1 million industry experts, please contact us.