The world’s largest corporations and most ambitious startups are finding their places in the metaverse already. The transformation is certainly underway, but the metaverse is not here yet, as some will claim it already is or at least imminent. Even though its future of it is uncertain, at the same time, there is a general understanding of how the metaverse is likely to work, and what will be the opportunities and challenges that might come with it.
October 26, 2022 / 6 min. read
Understanding the Metaverse - What Can Danish Companies Add to Global Development?
The world’s largest corporations and most ambitious startups are finding their places in the metaverse already. The transformation is certainly underway, but the metaverse is not here yet, as some will claim it already is or at least imminent. Even though its future is uncertain, at the same time, there is a general understanding of how the metaverse is likely to work, and what will be the opportunities and challenges that might come with it.
What does the Metaverse mean for the future of society?
In 2021, a few weeks before Facebook revealed its metaverse intentions, Tim Sweeney, the CEO of Epic Games tweeted a prerelease code from the company’s game Unreal from 1998, saying that players “could go into portals and travel among (different worlds)...with no combat and (would stand) in a circle chatting.” .
For the average person, gaming is probably the first peek into the metaverse's future.
The thought of the metaverse means an ever-growing share of our lives, time, leisure, work, wealth, and relationships will be spent inside virtual worlds, rather than only through digital devices. It will be an extension of our everyday lives. But it won’t happen overnight.
It is not possible to predict in advance exactly how important the metaverse might be to the global economy, society, and business, just as the world did not know the value of the internet back in the 1990s.
Sofie Hvitved is one of the leading experts in the development of the Metaverse, the Futurist and Head of Media at the Copenhagen Institute for Futures Studies, describes the metaverse as not a “switch flip” kind of transformation:
It’s an evolution or a long-term development that we are seeing moving towards this metaverse. As a company, you should be very aware of not only being focused on one technology or the one side of the metaverse but be very explorative and aware of the different layers of the metaverse that will be emerging."
Almost all of the work mentioned above has remained invisible to the average person, as much to the metaverse itself. Since this is an early stage as much as views on it, there is a lot of focus on how it will affect the companies. Simultaneously, companies are becoming aware of this development and its possible role in it.
The evolution of the Metaverse is underway.
The word metaverse is being increasingly mentioned on the corporate level as the largest public companies in the world. Apple, Amazon, Microsoft, Google, Tencent, and Nvidia have been busy preparing for the metaverse. There isn’t a metaverse product people can go buy, nor “metaverse revenue” can be found on an income statement. So, what is it or what exactly are they building?
Sofie Hvitved says:
“The move towards the metaverse is obviously the global movement and basically every big company is working on its own strategy of how this is going to develop.”
It is rather the big corporations that are reorganizing internally, rewriting their job description, and preparing multi-billion-dollar product launches.
According to McKinsey & Company the investments are floating in from the corporations, private equity companies, and venture capitalists that made $120 billion in metaverse-related investments during the first five months of this year. It is shaping up to be the biggest new growth opportunity for several industries in the coming decade.
What is the potential for the companies?
The potential impact of the metaverse varies by industry, as everyone won’t necessarily sit with virtual reality headsets all day and shop at a VR Nike store. Sofie Hvitved emphasizes that the metaverse is much more than VR and AR, which may become a preferred way to access it, but they are not. The metaverse should not be imagined as an overhaul to the internet, nor something that will replace mobile devices or software.
There are certainly various industries that are already using the metaverse: apparel, fashion, and luxury; consumer packaged goods; financial services; retail; and telecommunications, media, and technology. Companies are already leveraging the metaverse and may build lasting competitive advantages.
“Everybody who wants to dip their toes into this should develop a strategic stance, the role they want to play in it, do the testing, learning, and be aware of the new technologies and behaviors that the metaverse will produce,” advises Sofie Hvitved.
Given the potential of a wide range of industries, this brings plenty of opportunities for sprouting startups that can create a whole new market of services and products. Sofie Hvitved adds:
“One of the good examples is South Korea, and one of their many interesting projects right now is Sepeto. It is the metaverse that already has over 300 million users and this is something interesting to see because the development of the metaverse is not going to be anything if people are not going to use it.”
How can Danish companies add value and what can they do today?
The metaverse will also pose acute challenges associated with digital existence today, such as ethical issues, data security, misinformation, platform power, and user happiness, which can have an extremely large impact on our society.
“We need to be aware of the development already now and also take it seriously, so we do not make the same mistakes as we did when we entered the era of the internet,” explains Sofie Hvitved.
According to her, the culture, priorities, and philosophies of the companies that will lead the metaverse era, will also determine whether the future is better or worse. Nordic countries including Denmark, have a high degree of trust and a strong welfare system, which can be translated into the metaverse in a good way and also inspire companies from outside the Nordics to how things are done here.
“I think we have to take our long-term perspective glasses on and see how we can make sure that this metaverse makes a place where we want to live in as well. And how can we add values that we already have in the physical world here in the Nordics and put it into the development of the metaverse in a global sense,” says Sofie Hvitved.
The Bottom Line
As no specific company or country will develop the metaverse alone, it's essential that all stakeholders including corporate leaders, users, developers, and consumers, understand their roles and the ability to influence the status quo and the future, if this evolution is taken seriously.