I often hear the following phrases whenever I read anything about the Facebook Metaverse.
“Facebook Metaverse is booming at a faster rate than ever before, and everyone has an eye on it.”
“Facebook Metaverse offers a new world to the users and is emerging rapidly to take the future of technology to the next level.”
Reading these made me feel like John Travolta from Pulp Fiction.
Where? I don’t see anything
Despite the hype (as proclaimed by major publication houses), the actual reality is that Mark Zuckerberg’s Meta had to lay off 11,000 workers due to the poor reception of its flagship product, which was Horizon Worlds Metaverse. The company also lost $677 billion in market value.
That’s not all! John Carmack, who pioneered the VR, was so fed up with Meta that he called it quits.
Recently, the company announced that they are moving to generative AI, which sparked rumors that Zuckerberg is probably planning to ditch Metaverse. However, he squashed it by saying:
*The firm isn’t giving up on the Metaverse anytime soon*
Now, God only knows what Meta is planning to do next here. However, for the Metaverse Companies, who seem heavily invested in this technology, Meta’s loss could prove to be their gain as mistakes, they say, are nothing but portals of discovery.
So, here are some crucial lessons to be learned from the failure of Facebook Metaverse. Three lessons, to be precise.
Three Essential Lessons for Metaverse Companies
Be assured, these three lessons will help you build a successful Metaverse project.
So, let’s start with the first one.
Lesson 1: Build a Metaverse Product That People Genuinely Want
To sell a concept like virtual worlds, you first need a product that sounds interesting to people and is also fun to use.
While unveiling the Metaverse to the general public, Mark Zuckerberg simultaneously launched Horizon Worlds – a Metaverse VR game comprising a generous dose of virtual reality. In this game, you can participate in a virtual world through an in-game avatar that you can design with a custom face and an outfit.
Horizon Worlds lets you take pictures within the virtual world, join a party with a group of friends, and organize events, games, and social activities.
Basically, it’s a social game.
This was the first image that came out from the game.
Mark Zuckerberg taking selfie in Horizon Worlds
Well, the initial public reaction after seeing this was hilarious and brutal.
“It just looks soulless, empty, dead, artificial, void-of-life.”
“I just really wanted to know how they managed to pour 10 billion dollars into this? Where did that money actually go? Down a bottomless pit? I’m so surprised how you essentially try to make something like VR chat but with a 10 billion dollar budget and have an end result like this. This deserves to be laughed at.”
“It amazes me that he has casually blown the equivalent of NASA’s yearly budget on this thing.”
“Who is this supposed to appeal to?”
So, it’s safe to say that people didn’t like the product, putting a dent in the metaverse concept that Mark was trying so hard to market in front of the entire world. But why was he being so pushy about this technology in the first place?
The reason was the pandemic, in which e-commerce, remote working, and video calling became a norm as people were confined to their homes. Zuckerberg miscalculated and thought this would be the new normal post-pandemic and ended up putting all his eggs on Metaverse.
The end result was truly catastrophic for him:
- Meta’s latest financial results revealed that it had lost nearly $20 billion to VR since 2020.
- The investors increasingly became skeptical of the entire concept of Metaverse.
- Many prominent CEOs began to call out Mark Zuckerberg for his obsession with this project. They called it unimaginative, ambiguous, and hypothetical, which is causing his company to go astray.
- Employees working under Mark Zuckerberg began to lose confidence in him as a leader. They began to doubt his vision regarding Metaverse.
- As Metaverse failed to gain traction, the company’s value plummeted by $700 billion.
See, the people preferred more face-to-face interactions once the pandemic was over. They were uninterested in the idea of putting on a VR headset to interact with their friends through a 3D avatar. That’s a lethal mistake that Mark Zuckerberg made.
Now, none of this means that the Meta would be written off soon. No! No!
But the point is that if you are planning to invest in a new technology, then first come up with a product that piques people’s interests, just like how Valve came up with 2020.
Like Meta, they too wanted to invest in a Virtual Reality game. However, their approach was completely different. Let’s find out what they did differently than Meta.
How Half-Life Alyx Led to a Sale of 103,000 Valve Index Sets
Just like Meta, Valve Corporation began to experiment with Virtual Reality in mid-2010 and decided to build their next game on VR. While the company realized that the audience for VR games is limited, they still wanted to go with it as a long-term investment in newer technologies. In 2019, the company released Valve Index Set, a virtual reality headset.
Valve Index Set
In 2020, they released their first VR game, Half-life Alyx, which was an instant hit among the fans as they have been clamoring for a Half-Life game for many years. The last one was released in 2006.
The end result:
The Valve Index headset sold out in the USA, Canada, and Europe within a week of the game’s announcement.
Poster of Half-Life Alyx
By mid-January 2020, they were sold out in all 31 regions where the units were offered. Due to the announcement of Half-Life Alyx, Valve sold 103,000 Index units in the fourth quarter of 2019.
You can see how a product in which people were interested led to increased sales of VR headsets because they genuinely wanted to try it.
So, what can Metaverse Companies learn from it?
Come up with a product that the user genuinely wants and is interested in trying. If you do that, they will definitely give Metaverse a try. Don’t be in a hurry like how Mark Zuckerberg was with Horizon Worlds! Build something useful first, then go in front of the people with it (If you don’t want to get roasted)
The Half-Life series has been considered one of the greatest games of all time. People have been begging for the next game in this franchise for many years.
And Valve knew that.
People Protesting and Demanding the Release of Half life 3
So, by building a VR game in this universe, they gave people what they wanted while also capitalizing and succeeding on this newer concept of virtual reality.
Basically, it’s hitting two birds with one stone.
Lesson 2: Your Metaverse Project Should Have a Unique Purpose
Human society, in general, takes an interest in new technology when it has a purpose and satisfies specific conditions, such as:
- Does it fulfill a specific need of people?
- Does it solve a problem that people are experiencing at a specific point in time?
- Is it economically feasible?
Now, if you look at Facebook Metaverse, what is it trying to achieve?
A conference room in Horizon Worlds
Look at the above image and tell me why would people hold an office meeting in a virtual world when they can perfectly do it through video calling, or face-to-face? I can’t think of one reason why they would do it.
There is no need for this really!
Additionally, this entire concept is not new, as MMOs like World of Warcraft and Everquest have already achieved this 30 years ago.
Even the much touted NFTs, which are digital goods that you can purchase in Metaverse, recently crashed, with 95% of digital collectibles now completely worthless. The entire market has no value now.
Also, what’s worse is that Metaverse is not economically feasible yet as you need VR headsets for it, which are also very expensive.
All of this stops this technology from going mainstream.
So, if you want Metaverse to succeed, then it needs a purpose. Either, it should solve a problem, or fulfill a specific need of the people. There is no other way!
History is littered with examples of how a new invention spread rapidly amongst humans when it satisfied one of the above conditions.
Take, for example, the printing press developed by Johannes Gutenberg around 1439 in Germany. It spread like wildfire throughout Europe for a few reasons:
- Increasing demand for books amongst the middle class as they wanted to become more literate.
- Emergence of medieval universities for higher education in Europe, which further garnered more interest among people to get educated.
Rapid spread of Printing Press in Europe
There was a genuine need for books which led to the widespread adoption of this technology as people wanted to gain more knowledge and share ideas with each other, which was facilitated by the printing press in the form of printed books.
Johannes Gutenberg with his printing press
Also, the printing press made books and papers more affordable to people.
To further prove my point, here is another example:
India recently witnessed a digital payment revolution. Before COVID-19, Indians preferred to carry cash and were hesitant to perform online payments.
But the arrival of the pandemic changed everything drastically.
A Vegetable vendor in India accepting digital payments
Due to the fear of getting infected, people were hesitating to make payments with cash, and were looking for an alternative way to conduct transactions. That’s where UPI payments came in, which were safe as they were contactless in nature. These platforms also didn’t charge any transaction fees, so it was widely adopted by the people in a very short time.
The end result:
Digital payments became a new normal in the entire country post-pandemic, with the NPCI recently confirming that UPI crossed 10 billion monthly transactions in August.
The point I am trying to make by sharing the above examples is:
Both the printing press and UPI payments were widely adopted by the masses because they both fulfilled specific needs/demands.
Similarly, if you want your Metaverse project to succeed, it should have a unique purpose. Try to solve a problem, or fulfill a specific need that people currently need at the moment.
That’s not to say Metaverse hasn’t created meaningful products in recent times. For example, take a look at John Hopkins University Hospital, which is using XR devices to perform life-saving surgeries, or, for that matter, Vancouver Airport running 3D simulations to improve their logistics and passenger experience.
Now, these are some of the worthy purposes to pursue that Metaverse Companies should take note of when working on their projects.
Lesson 3: Focus On Iterating Metaverse
The success and failure of any new technology or concept depends on how economically feasible it is to implement it, which requires many cycles of iterations.
Metaverse currently lacks iterations because most people are focused on trying to make a quick buck from it (until it remains a fad) rather than working on making this technology more developed and feasible economically.
This is far from being ready
As you can see from the above image, Horizon Worlds is currently not fleshed out enough, but still, the company went into full production with it. The Horizon Worlds Gameplay was barebones, which is why people just laughed it off or ridiculed it when Zuckerberg tried to introduce it in front of them.
On the other hand, take a look at the invention of the light bulb, in which as many as 22 inventors were working on this concept.
Thomas Edison with his lightbulb
But Thomas Edison got the credit for it. Why? That’s because his version of the light bulb was economically viable compared to the rest.
The earlier light bulbs failed because they had extremely short lifespans and were consuming too much energy while also being expensive to produce. Thomas Edison took these earlier light bulbs as a base and continually kept improving them.
In the end, he was able to improve the lifespan of the light bulbs from 14.5 hours to 1200 hours, thus making them more practical and economically feasible to use.
The end result:
The electric light bulb became one of the most impactful inventions for mankind and changed the entire world.
So, at present, Metaverse Companies should focus on iterating this technology to the point where it becomes economically viable and better developed for public release.
It’s a Long Road Ahead
In short, Metaverse Companies should focus on iterating this technology to the point where it becomes economically viable, otherwise Metaverse will end up in the graveyard of failed inventions.
They should also get serious in building a product that fulfills a specific purpose and is something that people truly want. Most companies (take a look at the Earth 2 project) so far are just rushing in to make money quickly while the Metaverse remains in trend, which is extremely short-sighted and also harmful for its credibility.
In my opinion, Metaverse VR games do have potential. Personally, I would love to explore one in Space, and to be frank, gaming is the only place where I see the chances for Metaverse to thrive, but it needs more interesting games like Half-Life Alyx to become mainstream. Additionally, even the prices for VR headsets need to drop to make it affordable for people to purchase.
This will surely generate interest among the people for Metaverse in the long run.