Exploring Opportunities in the Metaverse
The metaverse is a virtual world in which users, businesses, and digital platforms can exist and interact. It includes everything from virtual social and gaming platforms. But in order to use it efficiently, there is a lack of high-end infrastructure and it requires a significantly high amount of energy. Experts suggest that the metaverse in the initial stages will be available on smartphones and the web.
At a recently conducted event by Data Security Council of India, industry experts talked about how metaverse is going to change the game in the near future.
The panellists for the session were Samrat Kishor, Partner Golden Next Ventures (session moderator), Anshul Rastogi, Founder, Totality Corp; and Sharat Chandra, Research & Strategy, EarthID. Corporate Citizen brings you the excerpts from the session
"If we want to see a hockey stick kind of adoption or growth of the metaverse as far as India is concerned, we need to have the right policies, to begin with"
- Sharat Chandra
Samrat Kishor: It is said that Neal Stephenson had predicted metaverse concept in a sci-fi book titled ‘Snow Crash’ in 1992. What started as science fiction is now a reality. We will talk about how people will interact, transact, do economic activities in the metaverse. In the metaverse, it is going to be a combination of different objects, ownership of objects, a change of ownership and the likes. Tell us your perspectives on the metaverse and what each one of you is doing in this space, and what are your expectations from the metaverse.
Sharat ChandraSharat Chandra: I am leading Research and Strategy department at EarthID, a de-centralised identity management platform. Identity is a key component of three stack, and that is where our key focus is. Talking about the metaverse, there is a lot of hype around the metaverse but I would like to throw in some element of scepticism and maybe a reality check. I will quote one observation by the head of Intel’s Accelerated Computing and Graphics Group and the gentleman heading the group says that ‘We need 1000x increase in computing power and we do not have infrastructure’. The 5G spectrum launch may happen in May 2022, and there is a proper process in how it rolls out and there are certain processes that need to happen. Talking about the computing capacity-quoting Moore’s law, computing capacity increases every 2-3 years. So, if you look at the curve, in the next 5-6 years, we still won’t be at the optimum level of computation power to have a seamless experience in the metaverse. He gives an example, if you want to have two people in the metaverse and see how they have an immersive experience with respect to touching objects or let’s say three modelling frameworks-we are still not there yet, we need the right tools so that people can start entering the metaverse.
Anshul Rastogi: I am the founder of Totality Corp, we are creating the Zionverse which is our Indian metaverse system based around Indian culture. Before I talk about the metaverse, I will first talk about Web 3.0. To me, Web 3.0 has three components - Ownership, Immersion and Integrated Economics. Moreover, Ownership is the reason why you need decentralisation and block chain. How we look at the metaverse is that the metaverse is a more immersive getaway to the Web 3.0 itself. Our view is that metaverse is not utopian and that seven odd billion of us will look exactly like the way we look right now with that amount of clarity, and I think that is utopian.
In addition, if you look at the immersion aspect which is where many people are thinking about whether to go with the metaverse - a lot of what is happening with the movie. There is keen attention on Virtual Reality (VR) and Immersion itself; our take is coming from a gaming background which states that immersion has also a spectrum. What Google paid it with respect to scratch cards was actually a more immersive and integrated way of doing payments-what you do with 2D games is immersive and what you do with 3D games such as Minecraft, is already immensely immersive.
The world has already moved towards a more immersive way of interacting with each other whether that is Minecraft where box looking world or that is Fortnite or PUBG where the art is clearer. I think that immersion is already happening. Now every interaction that we do needs to be more immersive. We have been talking about gamifying education, gamifying finance with robinhood so that is in process.
The other big change is ownership where the user is the owner on the block chain itself and is decentralised, and lastly, the integrated economics. For me, the triad of all the three factors is Web 3.0 and the metaverse is sort of a way to access Web 3.0 in the most immersive manner and that change is already happening. I will make a big comment saying that 2021 was the year when the mass adoption of it started and we are going to see a seamless transition to the metaverse over the next five years.
Samrat: I think with the adoption and advancement of mobile technologies there is a prediction that 75% of the population will be connected by 2025. My perspective is that people will engage with immersive experiences. Gen Z has left no stone unturned in adopting those immersive experiences in the form of entertainment. Now that has involved immersive shopping as well-we see a lot of shop-tainment applications which is live and making big waves on those segments.
"As far as an emerging technology is concerned, Unity gaming engine and Unreal gaming engine are both taking the lead in mobile and XR Unity frameworks"
- Anshul Rastogi
Let me touch upon the first part which we were talking about which is the tech stack. That is the biggest question when it comes to any technology and especially Indian folks talking about it-such as tell me what is under the hood; how can we pick this up; how can we run this? Would you like to throw some light on the tech stack that you see which is helping shape the metaverse and do you feel that it will drive adoption from both brands and individuals?
Anhsul RastogiAnshul: I will break it down into three factors. I will talk about Immersive first. As far as Immersive is concerned, what we are defaulting on is what has been already built for Immersive which are Unity Game Engine and Unreal Game Engine. In terms of mobile gaming, Unity Game Engine is already the leader in terms of the most mobile games created; many gaming companies have a custom engine and we are building on top of Unity as well. Unity and Unreal are leaders in this space and we may see a third one emerging in this category too, and primarily as well because they are well integrated with the block chain.
As far as an emerging technology is concerned, Unity and Unreal are both taking the lead both in mobile and XR Unity frameworks. In terms of ownership, since it has to be decentralised, that’s where a lot of block chain is coming in, and I think that is really an area that is going to change. So far, we had two proofs of consensus protocol on the block chain, which is the proof of work and proof of stake. Proof of work is primarily bitcoin and Etherium wants to move to a proof of stake, hopefully at the end of this year. But we are going to see more consensus protocol. There is no reason why another block chain won’t come out which will be proof of gaming, proof of interaction, proof of socialisation etc. it is a way of events.
The idea that people have that the dollar's equivalent is Ethereum and so on. I think it is completely incorrect because cryptocurrency is a way to make sure that whatever proof you have, there is a sustainable way for you to transact that proof between people who are either investing or people who are doing that labour and such. So, it isn’t equivalent of any currency, nor the equivalent of any top five currencies in the world. My view is that this is like technology; it is the technology, which is going to codify consensus and this will be one area where they will probably have the most rapid innovation as we keep going forward.
Samrat: Sharat, you have already stressed some of the pointers on technology being ready or the roadmap on technology, which is required to adopt metaverse or its applications. What are your perspectives on this and do you think that conversions and singularities should be the theme towards the adoption?
Sharat: To add to what you said about singularities, this is more like a point in time. Metaverse is going to be a point in time rather than a utopian space as well. If you look at the layers of the stack; some broad layers of metaverse itself is going to be 6 or 7 where we have the infrastructure which consists of cloud, Edge, WiFi, and GPU and that is what Intel is trying to do, trying to bridge the gap between what we have and what is needed for the application of Artificial Intelligence (AI). But again, that is a different discussion altogether. Now, if you look at the human interface, that is how you enter the metaverse using Artificial Reality (AR) and Virtual Reality (VR). Recently, I read in the news that there is a startup, which is creating a browser-based metaverse interaction experience. The name of the project is called Portals.
As Anshul has pointed out about decentralisation, the creator economy is one area where you will see a lot of meta-commerce happening and that is why all these big technology companies are moving in that space. And when it comes to discovering experiences-let’s say touching and feeling objects in the metaverse, that’s where the objects in the metaverse-that is where numerous 3D or spatial computing and 3D modelling frameworks will be applied extensively.
Samrat: What do you think or see as the technology changes, of course, there will be increased needs of connectivity, which needs to be updated but what else do you see as the paradigm-shifting technologies are required? For example, the internet was born at one time but then it took 20 years for Uber to be born out of the internet. What all do you think is required for a real blockbuster application to come out or a big metaverse to come out, and people just thronging to it?
Sharat: I could see a lot of privacy-preserving techniques like we have zero-knowledge proof and how we can protect our data because data and tokens will be the currency of the metaverse. There were a couple of instances where people were kind of abused in the metaverse, so how do ensure that individual rights are protected. That’s where a lot of discussions have to go around data protection and data privacy rights, and what is the new technology to which we can switch to and leverage that to take this journey ahead. I think privacy preserving-techniques, zero-knowledge proofs that’s where a lot of blockchain primitives will be applied.
Anshul: I think for us to get to that part where many people are interacting with each other at the same time will definitely need a lot more hardware upgrades. In terms of gaming, we do not have more than a hundred people playing with each other at the same time. Roblox and others are trying for thousand people at the same time but we are really talking about millions of people. There is also the backend development of data sharing-how do you transfer so much of data in real-time and lastly, in terms of transactions-suddenly when you have a million people playing together even if it is not in the same room as we know how Polygon crashed when we had started writing all about that on-chain data for just a hundred thousand people. For instance, consider games like Fortnite and PUBG which can be played in hundreds and millions. The handling of data and transactions per second is at a nascent for even to start writing this on-chain data.
Samrat: Do you think we will see more GPU farms coming up and more fossil fuel being burned to power these GPU farms? Do you also see sustainable computing coming into the picture?
Anshul: It is a fair question and I think it is a relevant point in terms of computation, as we actually move towards better protocols. However for immersion, we want more of it; we want more realism, we want more things that are not possible in the real world. Net-net, it would be energy consumption. The only sustainable way I see it is more sustainable energy sort of production rather than saying that, ‘hey, let’s not go towards that Immersion’. There will be more efficient ways in which the marginal energy consumption will keep reducing for the marginal game in Immersion but it still will be a net energy consumer. I agree that it is a very big point where we have to figure out more sustainable energy production and not go towards the higher Immersion route in my view.
Sharat: Just to add to what Anshul said, even Intel was supposed to launch Arc GPU in the first quarter of 2022 but again, they have delayed that because there is a global mandate to reduce emissions; so there is pressure on all technology manufacturers and semiconductor manufacturers as well. These broader global mandates will also have repercussions on the way technology improves or progresses.
Samrat: Which are the technology areas that are key to improving user experience and providing unique digital experiences to people who want to come and join the metaverse platforms?
Sharat: I think many human-centric experiences of a smartphone will have the same kind of experience as by using VR glasses, so technologies that can bridge the divide will act as enabling layer or tool for people who are joining the metaverse for the first time. That will also add to a lot of personalisation and that is where a lot of AI modelling techniques can come in. Consider that you enter a metaverse and you look at the right popups or things that you want to do in meta commerce. Those technologies will be of paramount importance.
"It is very possible in my opinion that we would end up having 10 metaverses instead of having one. Then we would have small ones, which will cater to the super niche"
- Anshul Rastogi
Samrat: While we talk about the technologies, which will enable that user experience layer, do you also see a similar adoption curve, which we saw for the internet? Now the internet is a household thing and now we are talking about how we get the next 500 million people online in India.
Anshul: My view is a little bit different than the consensus view with regards to the emergence. I think that metaverse is going to be a mobile-first ubiquitous experience. It will be a mobile-first, web-first rather than VR. I think VR is going to be the smallest part of the metaverse. There is going to be seamless adoption of the metaverse.
I know tons of banks and companies, which are working on virtual branches, virtual goods and virtual stores. The comparison is given what we have in the website with respect to something that looks good and has a good User Interface (UI) can we make it more immersive. That is one part of the user experience, the other part that we should not forget is the decentralisation not just from ownership but also from labour. There are companies already working on decentralising customer service. For example, what already happens on Amazon, if I am a verified customer and I write a review of some product then there is no incentive for me directly, to keep writing reviews on Amazon. What people do is companies will give you a discount card-when it becomes tokenised, it is going to improve customer service by a significant magnitude. You will be able to earn money by being a verified customer and writing reviews good or bad. In addition, people will actually write honest reviews rather than writing fake reviews-someone who owns the product has given the review and it is a system, and it is not an agency that gets out and gets a thousand people to give fake reviews.
That being said, in my newly created customer service programme, I can do one-on-one calls if it requires with the customer to actually understand the product use rather than employing customer service people in thousands. Therefore, user experience even with these services will pick up a notch because of the decentralisation of labour.
"I could see a lot of potential of people who can create low code/no code solutions so that a common man can leverage these new tools. If you look at the robotic process, it is a low code/no code rules have a bigger role to play"
- Sharat Chandra
Sharat: If we want to see a hockey stick kind of adoption or growth of the metaverse as far as India is concerned, we need to have the right policies, to begin with. In a long-term horizon of how this entire space is evolving and we cannot look at just one aspect. If we look at the recent development where one of the regulators, are a kind of anti-tokenisation or anti-virtual digital assets, hence, I am not sure how that approach will translate to broadening vision from the Vedas to the metaverse. If you want to position India as the next superpower when it comes to an era, we need to be cognizant of the fact that our policies are fine-tuned in that direction so that our journey from the Vedas to the metaverse happens in the right way, and we won’t end up being backwards of the world.
Maybe we can look at South Korea for that matter; they have already laid out plans for the next five years. They have generated funds and have a plan on how they will invest in technologies enabling the metaverse, therefore, we need to have a similar approach, a very innovation-friendly approach so that we don’t lose sight of what lies ahead.
Samrat: We have experienced the exponential ballistic growth of Pokemon Go. We have all seen it the way it just took off within no time. At points, I saw people importing phones and whatnot just to get on board in the countries where it was not launched yet. On one side, if you have a market there are people who want services like these and want experiences like these. On the other side, there are tech providers, and then there is the commerce of the interaction layer where we see companies coming on board of the metaverse bandwagon. Are there going to be many metaverses or is there going to be just one?
Samrat KishorSharat: I think you can draw a parallel the way blockchains work. There is no one blockchain rolling, hence, there will not be a single metaverse rolling. Therefore, there will be metaverses using the right open standards and proper tools that will shape the momentum of adoption of the metaverse.
You might see big techs creating their silo ecosystems, but again, that option will happen when you create open interoperable systems.
Anshul: I agree with Sharat. There won’t be one metaverse, it will have open standard. However, what we see with the digital economy is that we should think about why Web 3.0 is very powerful is that humans really care about currencies, one is the social currency and the other one is the tangible currency of which money is also a part. What we have seen is that in the digital economy, there are two systems, we have the likes of Amazon etc. who are focusing on the tangible currency-money and goods, which are tangible.
On the other hand, we have Facebook, Instagram, TikTok etc. which are looking at social currency and Web 3.0 is going to really combine them which is why it is very powerful but its implication with respect to the metaverse is that you have now magnified the network effects.
By magnifying the network effects truly, there is a monopoly of super apps, which people have been talking about and so far yet has only been seen in China. It is very possible in my opinion that we would end up having 10 metaverses instead of having one. Then we would have small ones, which will cater to the super niche. It is going to be a very barbelled world because of the combinational currency and tangible currency in one ecosystem.
Samrat: In enabling the metaverse applications, what exactly is the role of software engines-tools to produce virtual content and assets and next-generation networks?
Anshul: What we have already seen and the path we are already taking, which is user-generated data is going to be the way that you get the most sustainable form of experiences and content. Of course, there will be the likes of Netflix-where there is higher production value etc. But what we have seen with TikTok, Snapchat, YouTube and the likes is that user-generated data is going to be big, which means we have to create a lot of software and tools to enable people to not only create 2D and video content but get gaming 3D interactive content. We have kicked up a notch in terms of complexity.
Sharat: I could see a lot of potential of people who can create low code/no code solutions so that a common man can leverage these new tools. If you look at the robotic process, it is a low code/no code rules have a bigger role to play. In fact, they have rather accelerated the types of automation where you are now looking at hyper-automation rather than routine robotic process automation.