Recently, the blockchain and crypto ecosystem has been buzzed severally with the concept of the metaverse as it gradually becomes a globally anticipated interactive, immersive and collective experience in the history of technology and the internet.
Many people think of the metaverse as an avenue for global empires to display their technological prowess or just a platform that allows esoteric groups to display non-fungible tokens(NFTs). They may be right anyways, given that giant companies like Meta(formally Facebook) are investing huge sums of dollars into this flourishing space.
But, a close look into the Metaverse framework reveals a lot more than the above. The metaverse is the genesis of a new digital world, a world full of opportunities for consumers and businesses, as well as some risks.
Small businesses are the best avenue for the public to gain wider adoption of the metaverse against the current dominance of the big corporations.
A historical study on the patterns in which technology like the internet, financial technology and many more we adopted in the past, shows the monumental role small businesses play in getting the masses acquainted.
Some detractors believe that the glory of the metaverse will be short-lived but the timeline for the massive adoption is spread out at least over a decade.
Some policymakers have opined also that the metaverse will be a functioning daily life aspect of more than half a billion people globally.
Though the metamorphosis of the physical world into the metaverse may not be as immediate, businesses should be nudging towards adopting and investing in the technology. Any enterprise that uses its resources strategically is bound to improve its customer experience in the future.
This article will highlight the business opportunities and risks in the metaverse.
What Is The Metaverse
The metaverse can be explained as a virtual world where people can interact and socialize.
That is to say that people can carry on with their daily activities in a digital world using some advanced technologies. The metaverse is an avenue for people to work, pray, transact, socialise and do anything they have been doing in the real world.
It is a highly scalable continuous network of interconnected digital worlds with features of real-world interaction.
A user is engaged in the virtual environment using advanced visualization and technologies(AR, VR, Haptic Sensors, and so on). This means that a user can interact with other users in a completely digital world anytime.
Understanding the infrastructure of the metaverse will help us understand the opportunities and risks involved in the metaverse.
The Infrastructure Of The Metaverse In Seven Layers
- Infrastructure: This is the layer with material science, semiconductors, cloud computing and telecommunications that enables other layers to be constructed over it.
- Human interface: This refers to the hardware devices that are used to gain access to the metaverse. This includes mobile devices, computers, AR devices and VR headsets.
- Decentralization: This layer ensures everything is built on a distributed, decentralised and democratized structure.
- Spatial computing: This layer deals with software that brings objects into 3D and allows the hardware interface to interact with them.
- Creator economy: This layer allows creators to embark on metaverse projects and also monetize them.
- Discovery: This layer gives ways to discover the metaverse experience.
- Experience: Users can engage with games, social experiences, and live music on this layer.
How The Metaverse Is Creating Businesses Opportunities
The metaverse is a pool of opportunities for businesses to immerse in and thrive. A good example of an industry in which the metaverse is gradually reshaping for good is the gaming industry.
The gaming industry is traditionally recognised for its affinity for adopting advanced technologies into its various components.
Many avid gamers and metaverse enthusiasts believe that the metaverse is the next frontier in gaming, giving an unimaginable experience.
Metaverse is changing the narrative of today’s lonely gaming as alleged by some developers, even though the multiplayer feature in most modern games has eliminated this problem of solitude in gaming.
Metaverse gaming platforms like Sandbox, Axie Infinity and Decentraland create gaming communities which give many monetary and social benefits.
Even though the metaverse gaming space is a good business opportunity for the gaming business, it is dominated by large firms with huge capital which makes it difficult for small businesses to thrive.
Metaverse real estate is a good sector with a pool of opportunities for businesses and consumers.
Just like in the physical real estate market, some brands like Decentraland and Sandbox sell parcels of digital land in the metaverse.
Often, the brand’s native cryptocurrency is used to carry out the transaction, although some projects may permit the use of fiat money.
A parcel of land on Decentraland was $20 when it held its first LAND auction at the Terraform Event in December 2017. The same parcel of land some for over $6,000 in 2021 and $15,000 per LAND token in 2022.
Even though this sector is dominated by big brands, small real estate companies can still cut the slack in this opportunity.
Fashion is another sector gaining traction in the Metaverse. A successful Metaverse Fashion Week had just been concluded. It ncluded runway shows, after-parties, immersive experiences, shopping and others panel talks and more.
Risks Associated With The Metaverse
The major risk of the metaverse on small businesses is the uncertainty and nascent character it could display due to its infant nature.
The metaverse ecosystem is still developing, hence, it will be difficult to confidently predict the survival of businesses, especially small businesses.
However, amidst this risk, it is apparent that adopting and exploring the metaverse not only prepare these businesses for the future but also makes their present offerings look more lucrative.
The business opportunities in the metaverse are undoubtedly numerous and they comparatively outweigh the risks.
Businesses in different sectors are fast taking advantage of the pool of opportunities in the metaverse to grow their brands and reap profits.
Aside from the business opportunities, the metaverse is likely the next big thing that will happen to the digital world.