Has the ChatGPT Craze Killed the Metaverse?

Yeah, yeah. We’ve all seen the memes. We’ve all seen the headlines. Somehow, everybody’s attention was hijacked overnight and now the only thing people can talk about is ChatGPT. This whole boom of interest has got people saying that the Metaverse was all just a flash in the pan, and that generative AI like ChatGPT is the only technology that matters. 

I was gobsmacked this morning to see an article from Marketwatch applauding Meta for pivoting away from “irresponsible” spending on the metaverse. This is a headline that is not only untrue (Meta’s budget cuts have been largely on personnel in core businesses), but also ironically irresponsible in the very short-sighted, anti-innovation message that it sends to the market. Institutional investors aren’t plugged into the intricacies of the tech industry at the best of times, and this media push to reward tech companies for holding desperately onto their waning ads business is not good for anyone. 

Let me just say it: despite the flavour of the month having suddenly changed, the metaverse is one of the most important technology revolutions of our generation. Combined with Generative AI and Web3 infrastructure, the metaverse will be the basis of what Deloitte’s resident futurist Duleesha Kulasooriya is calling “the next internet”.

How will the metaverse change our lives?

One of my last projects at Meta was developing something called the Metaverse Readiness Model. It’s effectively a methodology for companies to assess how ready they are to execute on the upcoming metaverse wave, across a number of factors such as tech infrastructure, people capabilities and their ability to measure ROI and report on business impact. 

During the process, a few people asked us why we’re creating something called a readiness model - surely we should be creating a Metaverse Maturity Model? The acronyms alone for this project would be amazing - MMM? M3? The truth is, if we set out to measure the current metaverse maturity of pretty much any company on the planet today, the score would be close to, if not exactly zero. So rather than focusing on current state maturity, we wanted to give companies a useful way to look at how to take pragmatic steps towards capturing this opportunity space in an incremental way.

Through the research phase of the project, we identified five key use cases for which businesses will be using the metaverse:

1. PLAY

Delivering the metaverse experience through content. Think of a QR code on your cereal box that launches an animated character. Changi Airport in Singapore has an AR dinosaur experience. You get the picture. These are not groundbreaking examples, but represent a way for brands to dip their toe in the metaverse waters.

2. EXPLORE

Bringing users across time and geography. If you’ve ever tried on virtual lipstick or tried on sunglasses in AR before buying them, you know exactly what we’re talking about here. It’s a supportive piece of technology to an existing customer journey.

3. LEARN

Immersive training, analytics and research delivered in a way that lowers the time and cost of these exercises. This is where it starts to get very interesting. Think about any industry where individuals are put in dangerous situations like mining or construction - training in a virtual environment makes things drastically better and cheaper. Hilton Hotels are training their staff in VR before setting them loose on the real customer experience, and Accenture are onboarding new joiners in VR where they can visit digital twins of their offices in other countries without leaving their bedroom.

4. CREATE

Immersive experiences for people to do their work. Imagine an architect who can design a building while walking through a virtual version of the building itself. Product designers who can iterate and test a product with customers all over the world in hours rather than months. Surgeons who can perform life saving surgery from the other side of the planet. This is where the applications of the metaverse start to have material impact on the economy and the way we live, work and play.

5. CONNECT

Where borders and geography cease to be any kind of limitation. Imagine you’re a young person growing up in a rural part of Indonesia. Right now, where you are born will largely dictate the educational opportunities, the career opportunities, and the opportunity to experience financial inclusion or participate in the economy. Now imagine that the same young person is able to attend the same schools as anyone else in the world, or work in a completely distributed workforce. We will no longer see pockets of talent like Silicon valley, and population density will begin to disperse. A true meritocracy will replace our current societal system, and geography will no longer be a limiting factor. 

So why is public metaverse sentiment down?

I can hear you asking: “if these five use-cases are so amazing and the metaverse is going to change the world, why are we seeing this dive in sentiment towards the metaverse and everyone’s attention shifting to ChatGPT?”

So here’s the thing - it’s actually kind of true. Through our research process whilst developing the readiness model, we looked at Facebook and Instagram data. What we saw was that interest in the metaverse steadily climbed for months, and then sharply dipped. Sentiment towards the metaverse really did take a nosedive.

However, there’s one thing no one is mentioning: this is completely normal! We’ve seen this kind of curve many times before throughout history, it’s called a hype cycle.

This pattern arises because of the first problem with innovation: innovation is hard to see. We’ve seen numerous examples throughout history:

• When the telephone was invented, Western Union (who owned most of the telegraph lines) argued that the telephone would never be a viable form of communication
• When the automobile was invented, US Congress issued a memo saying that cars would never replace horse and carriage

Time and again, industry experts fail to see true innovation even as it’s happening right in front of them. Perhaps a more recent and recognisable example would be Amazon Web Services (AWS) and the rise of cloud computing. At the time, Amazon CEO Andy Jassy said this about the AWS journey:

“First, they said no one will use it, then maybe only startups will use it — but they won’t use it for anything real. Then it was enterprises will never use it, then enterprises will never use it for anything mission critical. Companies and developers voted with their workloads and now [competitors] are in this spot of trying to spin something up and you know, it’s six or seven years late”

Think of all the companies who poo-pooed cloud computing in its infancy and wrote it off as a fad that didn’t require serious investment. Those same companies have just spent the last 10 years playing catch-up, investing billions of dollars and loads of resources just trying to get back to the same level as their competitors. 

There is absolutely no doubt that we will see the exact same ignorance about the metaverse. I just hope that some companies have learned something from these lessons of the recent past, and they understand that investing small, investing early and taking small steps now will mean they don’t need to waste the next decade playing catch-up.

Is the metaverse obsession over?

I have one last point to make. As I often say: follow the money.

As everyone sits around waiting with bated breath for Apple to finally drop their Mixed Reality device, there has been a battle being waged in relative silence. Microsoft and Meta have both been throwing tens of billions of dollars trying to win the enterprise metaverse race. Both of these companies intimately understand that whoever wins the enterprise will end up becoming the Operating System for the metaverse. That is the holy grail for the next generation of technology.

There is absolutely no doubt that over the coming months we’re going to continue to hear more about ChatGPT and Generative AI and how that’s the next wave of everything. You will see many stories talking about the death of the metaverse before it even really got started. When you see these headlines, just remember that the headlines often get it wrong. No one wrote about the Wright Bros first flight until four years after they had changed the world. When a game changer occurs, sometimes it just takes a while for people to recognise that the game has been changed.