Microsoft and the Metaverse
Courtesy of Ben Thompson, Stratechery
It’s certainly the question of the season: what is the Metaverse? I detailed the origin of the term in August; that, though, was about Neal Stephenson’s vision and how it might apply to the future. For the purpose of this Article I am going to focus on my personal definition of the Metaverse, how I think it will come to market, and explain why I think Microsoft is so well placed for this opportunity.
Here is the punchline: the Metaverse already exists, it just happens to be called the Internet. Consider the seven qualities Matthew Ball used to define the Metaverse; the Internet satisfies all of them:
- The Internet is persistent
- The Internet is synchronous and live
- The Internet has no cap to concurrent users, while also providing each user with an individual sense of “presence”
- The Internet has a fully functioning economy
- The Internet is an experience that spans both the digital and physical worlds, private and public networks/experiences, and open and closed platforms
- The Internet offers unprecedented (although not perfect) interoperability of data, digital items/assets, content, etc.
- The Internet is populated by “content” and “experiences” created and operated by an incredibly wide range of contributors
I really don’t see anyone creating some sort of grand nirvana that beats what we currently have on any of these metrics. The entire reason the Internet is as open and interoperable as it is is because it was built in a world without commercial imperative or political oversight; all future efforts will be led by companies seeking profits and regulated by governments seeking control, both of which result in centralization and lock-in. Crypto pushes in the opposite direction, but it is a product of the Internet that relies on many of the qualities in Ball’s list, not a replacement.
What makes “The Metaverse” unique, then, is that it is the Internet best experienced in virtual reality. This, though, will take time; I expect that the first virtual reality experiences will be individual metaverses, tied together by the Internet as we experience it today.
Mobile and the Physical World
Forecasts, particularly those that extend multiple years into the future, are always a dangerous enterprise; look no further than January 2020, when I argued in The End of the Beginning that mobile + cloud represented the culmination of the last fifty years in tech history:
The idea behind this article is right there in the title: “The End of the Beginning”. Tech innovation wasn’t over, it was only beginning, but everything in the future would happen on top of the current paradigm.
Then COVID happened, and now I’m not so sure if that’s the entirety of the story.
Implicit in the assumption that mobile + cloud is the endpoint is the preeminence of the physical world. After all, what makes the phone the ultimate expression of a “personal computer” is that it is with us everywhere, from home to work to every moment in-between. That is what allows for continuous computing everywhere.
At the same time, for well over a year a huge portion of people’s lives was primarily digital. The primary way to connect with friends and family was via video calls or social networking; the primary means of entertainment was streaming or gaming; for white collar workers their jobs were online as well. This certainly wasn’t ideal: the first thing people want to do as the world opens up is see their friends and family in person, go to a movie or see a football game as a collective, or take a trip. Work, though, has been a bit slower to come back: even if the office is open, many meetings are still online given that some of the team may be working remote — for many companies, permanently.
This last case presents a scenario where the physical is not pre-eminent; an Internet connection is. In this online-only world a phone is certainly essential as a means to stay connected while moving around; it is not, though, the best way to be online. Virtual reality could be.
