Metaverse Update: After the Hype, Expectations (Finally) Get Real

Mark Zuckerberg whipped up the excitement in the fall of 2021 when he changed the name of Facebook to Meta and announced plans to build out the “metaverse.” Then came the splashy retail-brand launches in the nascent virtual world, the 2022 Super Bowl broadcast awash in crypto ads, the glitzy Metaverse Fashion Week featuring avatar models and immersive runways, Snoop Dogg’s groundbreaking metaverse-based music video, JPMorgan Chase’s virtual bank opening in the immersive online platform Decentraland, and a slew of gung-ho books declaring an internet “revolution.”

The metaverse held the promise of a borderless, immersive environment that replicates the physical world, where anything you could imagine could be realized, a space that would completely transform the way we interact with each other, at work and at play. Money poured in to build out the infrastructure. It was hailed as the future of the internet.

Fast-forward to now, and the expectations for the metaverse are a little different. It’s definitely not dead, not yet – consider it more a phenomenon in recovery. Following all the hype and promise of a few years ago, its momentum has slowed, and analysts and businesses are assessing its potential through a more pragmatic lens.

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Arguably the biggest buzz-killer came last year when Reality Labs, the Meta unit developing virtual reality, augmented reality, and the hardware to experience the metaverse, reported it had lost a stunning $46.5 billion since 2019. The company’s Quest headsets (and other brands’ headsets), along with cameras, sensors, and other technologies, make the immersive 3D experiences of the metaverse possible.

“Not all that glitters is gold,” says Sam Jordan, manager and lead of Computing and Advanced Technology Practices for the Future Today Institute, paraphrasing Shakespeare. “I think that the initial luster of the metaverse was completely artificial. I think it was a lot of cosmetics there, and the reason for that is because it started off as a solution looking for the problem.”

That said, Jordan believes the metaverse is getting closer to solving real problems for businesses, and artificial intelligence (AI) could play a role in making that happen. Examples include natural language processing (NLP), which facilitates real-time language translation and interpretation; content creation; and AI photorealistic avatars for employee collaboration – figures that can walk into a virtual office, interact with colleagues, share ideas, give presentations. In its “2024 Tech Trends Report 17th Edition: Metaverse: New Realities,” the Future Today Institute forecasts that photorealistic avatars will disrupt organizations and have their “time of impact” within the next four years, and avatars will become normalized in collaboration platforms within the next five to nine years.

Headset headaches and other metaverse challenges

The virtual-reality user interface (UI) is a big reason the metaverse is advancing more slowly than the initial projections. Especially the headsets. (In addition to Meta’s Quest, other headsets for the metaverse include Apple Vision Pro and Microsoft HoloLens.)

The initial luster of the metaverse was completely artificial… It started off as a solution looking for the problem.

People have difficulty transitioning back to the real world after wearing a VR headset, Jordan notes. This is called experiential artifacts, in which VR users have lingering sensory effects after taking off their headsets, and the physical and digital worlds appear blurred together. Jordan sees the user interface as an obstacle in the metaverse but an opportunity at the same time.

“We’re still using the same UI and UX paradigms that we use for 2D interfaces, like how we interact on screens,” Jordan explains. “So I think for there to be adoption and for this to find a practical use case, there needs to be a lot of innovation for UI and UX [user experience].”

Business leaders, of course, have been especially attuned to how that user experience plays out on the job. If, as proponents still claim, virtual realities are going to reconfigure how we do business, then they will impact the employee experience in a major way. And with that, metaverse founders have some significant challenges ahead. The headsets’ heavy weight and awkward appearance in public may hinder their use. (Is the average employee willing to look like this at work?) People have not become comfortable with the behavior shift in wearing headsets, according to Jordan.

“It’s going to necessitate that people are cool with changing their behavior or changing how they do work or changing how they interact with content,” she says. “And I don’t think that socially we’re ready for that.”

[Read also: Why workers don’t like to change their behavior, and how that’s led to a wave of shadow IT – it’s time to shine a light on yours]

Jordan questions the needs for computing in headsets altogether in the metaverse.

“There’s definitely an argument to having [computing capability] in the device, but one tech component that I think we’ll go back and forth on in the next couple of years is whether compute needs to be in the headset or like if it can run remotely on our phone,” Jordan says.

In a WSJ Tech News Briefing podcast, Jeremy Bailenson, the founding director of the Virtual Human Interaction Lab at Stanford University, also notes the awkwardness of the VR headsets and how they’re not a comfortable alternative to video-conferencing services like Zoom, Teams, or Google Meet. “There are still 10 to 15 button-presses, different accounts – there are a lot of things that get in the way, and consumers are quite fickle when it comes to technology,” Bailenson says. “Perhaps in the future, we will develop some way to wear this hardware where you can wear it for quite some time without getting either simulator-sick or not uncomfortable to the point where it is heavy on your head.”

And all of these concerns still do not address another major stumbling block to metaverse adoption at work: the fact that many employers have no (or little) clue how their employees feel about their digital employee experience (DEX), let alone how they will feel if they suddenly have to grapple with the metaverse. New approaches to digital experience monitoring and more strategic use of employee engagement surveys will likely be essential first steps if any metaverse migration at work is to follow.

Changing expectations for the metaverse

Public expectations for the metaverse are mixed. Even in the midst of 2022’s metaverse mania, a survey by the Pew Research Center and Elon University found 54% of respondents (which included technology innovators, business and policy leaders and researchers) believed the metaverse will be a “more refined and functioning aspect of daily life” by 2040 while 46% countered that it will not.

I think partly people were disappointed that we weren’t getting The Matrix overnight.

Hollywood may (to some degree) be to blame, suggests Robert D. Austin, professor at the Richard Ivey School of Business in London, Ontario, and an affiliated faculty member at Harvard Medical School.

“A lot of companies had big hopes for the metaverse in the near term and invested a lot in it…I think partly people were disappointed that we weren’t getting The Matrix overnight,” Austin says. “[Now] people are past the hype, the despair, and hopefully starting to get a more grounded and reasonable take on what’s going to happen.”

In the early 2024 report “Navigating Beyond the Hype: The Metaverse Take Two,” David Kadio-Morokro, financial services innovation leader at EY Americas, and Arwin Holmes, EY’s global blockchain chief technology officer and metaverse leader, see the next generation of virtual reality and mixed reality headsets as improving the user experience. They also believe that game engine technology and VR/AR headsets will be an expected aspect of immersive website experiences.

[Read also: The metaverse is just one way to connect with workers – here’s how to rethink employee engagement strategies for the modern workforce]

“Developers, with new toolsets in hand, will push the envelope until websites as we know them may serve as metaverse footholds ready to be connected to each other through Web3 technology,” Kadio-Morokro and Holmes wrote.

Bonus track – a metaverse update may upgrade your DEX

In addition, the metaverse could improve the digital employee experience in the industrial world and the customer experience in both the social and enterprise spaces, according to EY. And they expect generative AI and Web3 to help add value to both DEX and CX.

Developers, with new toolsets in hand, will push the envelope until websites as we know them may serve as metaverse footholds ready to be connected to each other through Web3 technology.

For instance, employees often suffer through a disconnected experience at the workplace, too often saddled with multiple endpoints and platforms requiring repetitive and complex procedures (and, for employers, evolving forms of endpoint management). The metaverse might actually offer enterprises a more holistic experience, a single destination that feels more intuitive and transparent. In fact, experts expect immersive technologies to play a role in the industrial metaverse. A Nokia and EY study released in June last year found that 80% of early adopters of the industrial metaverse believe it will have a “significant or even transformative impact.”

Automotive manufacturers like Volvo Group, for instance, are using VR tools to enhance employee safety and efficiency with its Emergency Response Guides app, Kadio-Morokro and Holmes noted. MGM Resorts has given job applicants the chance to try out roles using virtual reality. And Globant, a UK-based firm that helps brands adopt immersive experiences, offers a “Web 360” onboarding with virtual reality to welcome new hires.

[Read also: Worker distraction is on the rise – and a new generation of DEX platforms can help]

Since the metaverse is still considered “gimmicky,” says Jordan, companies should require employees to use it only if it really improves productivity or overall job satisfaction.

“Don’t just implement it because it’s a cool novel thing,” she says. “It needs to either be a totally different experience, or it needs to help me be better at my job, help me navigate spaces, help me build things, but it can’t just be a copy-paste of physical reality.”

TO LEARN MORE ABOUT THE METAVERSE:

Read previous installments of our “Meeting the Metaverse” series, where we explore the unprecedented potential of this virtual new world – and its very real security risks.

• Why Corporate Leaders Must Secure the Wild West of the Metaverse
• Are Metaverse Meetings the Answer to Better Employee Engagement?