When Mark Zuckerberg announced Facebook’s change of name to Meta Platforms in his Founder’s Letter on 28th October 2021, it signified a monumental shift in focus for one of the world’s most powerful tech companies. The newly coined Meta would be metaverse-first, not Facebook-first. The announcement burst the floodgates open as billions of dollars of investment poured into the development of metaverse-related technologies. Big Tech wanted to get in on it. Baidu unveiled Xi Rang or “Land of Hope”, Apple expressed its interest in the potential of the metaverse and Microsoft’s attempted $75 billion acquisition of Activision Blizzard has been described as a “pathway to the metaverse”.
News of a poaching war ensued as engineering talent was lured away from different tech companies with the promise of hefty salaries and bonuses; not the best look given the recent round of industry-wide tech layoffs.
The metaverse was the buzz word of late 2021 and 2022. Even despite those who weren’t convinced, notably Twitter’s Elon Musk, who felt it wasn’t ‘compelling’, and Snapchat’s Evan Spiegel, who said it was the last thing he’d want to do after a long day at work, there was a sense of FOMO. If you didn’t get in on it soon, you could miss out on Web3, the next evolution of the internet.
The FOMO was understandable. It was Mark Zuckerberg’s big gamble. Through his sheer determination to make things happen, the metaverse was, to many people, a safe bet as the next stage of the internet’s evolution. When Facebook reported a decline in users for the first time in its history, people jumped on the bandwagon to write off the company. It’s over, they said, as Meta’s share price tumbled. However in the next quarter Meta reported user growth of 3 million additional users to bring DAU to 1.96 billion, exceeding analyst expectations. Few people have taken on Google and won. Who remembers Google Plus? And few people still would reject a $1 billion offer from Yahoo and turn their social network into one of the most powerful technology companies in the world.
But now the landscape has shifted. There’s a palpable difference. The global conversation has moved on from terms such as virtual/augmented reality and metaverse to artificial intelligence. Seemingly out of nowhere OpenAI’s ChatGPT was launched to the public on 30th November 2022 and its capabilities have forced a change in conversation; so much so that Google issued a ‘code red’ alert, signifying the threat to the dominant search engine’s market share and advertising revenue. No longer are people talking about how the metaverse will change businesses and industries, but how ChatGPT and AI is already impacting jobs, companies and whole industries.
People have been quick to point out AI’s limitations, either by a chatbot providing incorrect information or insulting its users. But it’s hard to ignore how good it is too. People have asked ChatGPT to generate code for their websites and it does it within seconds. ChatGPT has passed exams that take months of dedicated study time for us mere human beings. We’re still figuring out AI’s potential and regulators are having a hard time keeping up. If anything has been disruptive, a buzz word in tech and entrepreneurial circles, it’s AI, not the metaverse.
The metaverse is about connection, about creating presence, whereas AI is about capability. They are two very different areas of focus. However AI is undeniably winning the war on capturing the world’s awe and attention, helped in part by metaverse setbacks such as Decentraland having only 38 users in a $1.3 billion ecosystem. Google has launched Bard, Bing has reinvigorated itself with ChatGPT and venture capital money is flowing into a wide variety of AI-related startups.
So what does this mean for the metaverse? Is it dead? Will it be quietly forgotten as Big Tech and new start-ups alike strive to take advantage of this new wave of AI hype? Perhaps, perhaps not. The metaverse isn’t dead… yet. It hasn’t been particularly easy for Horizon Worlds, Meta’s virtual world, to catch on when VR headsets such as the Meta Quest 2 retail at $400 and Meta Quest Pro retail at $999, previously priced at $1,500.
And while the AI capabilities being developed and deployed are remarkable, we’re living in a time of hype. Cryptocurrencies and NFTs have gone through the cycle, and following the collapse of Silicon Valley Bank, more eyes are on crypto again as an alternative to traditional banking. The metaverse’s hype has declined too but a resurgence could come at any time. AI has incredible potential but it could take only one significant mistake for the world to put brakes on the hype.