The metaverse is finally facing a media reckoning

Barely a day goes by without negative news coverage slicing another cut into metaverse hype, either in the form of a big company backing away from previous enthusiasm, or a thundering editorial declaring the entire concept to be yet another tech dead-end. 

This reversal from last year’s largely unquestioning coverage is certainly being driven by negative events in the world of business, but is it also an inevitable blowback from puff pieces – often in the same publications – that were so recently awestruck by metaversal potential?

In an email interview with GameDaily, Matthew Ball, author of best-seller The Metaverse, noted: “The unique challenge with the metaverse is that as a ‘theme’, it arrived so suddenly and forcibly, and many argued it was already here, and if not, it was imminent. This was bound to disappoint because the average consumer couldn’t go buy a ‘“’metaverse product” on a shelf, investors didn’t see metaverse revenues, and society didn’t feel as though life was that different than it was a few years ago.”

Layoffs and losses

Just last week, Reuters reported how gaming giant Tencent is reversing a plan – initiated less than a year ago – to invest heavily in metaverse and VR development. The article reported that “difficulties in achieving quick profitability and the large investment needed to produce a competitive product were among factors that prompted a shift away” from focusing on VR-metaverse development. 

Infamously, Meta’s metaverse-focused division Reality Labs lost $13.7 billion in the past year. The Motley Fool recently poked fun at Meta CEO Mark Zuckerberg for a recent earnings call in which he barely mentioned the M-word, despite his obvious enthusiasm for its potential. 

Many argue that it was Zuckerberg’s big bets on metaverse development that prompted so many companies to announce their own metaverse investments, few of which have yielded much in the way of progress. “The metaverse project has fallen flat thus far, not just at Meta but elsewhere as well,” wrote the Fool. 

Sony’s new PSVR 2 has attracted mainly positive reviews, tempered by the fact that it carries few games of distinction, and those are generally single-player games. As The Guardian noted in its review posted last week, “big tech’s conception of the metaverse, … is informed entirely by capitalist greed and not at all by what actual people want.”

Faddy and improbable

Ball believes that the metaverse’s nature invites disappointment and skepticism. “One thing I have always tried to stress is that the question of ‘when’ something arrives is really a ‘when does what arrive, for whom, how, to what end’,” he says. “Smartphones had tens of millions of users in the late 1990s, but most Americans didn’t have one until 2014, most people didn’t until 2020.” 

Still, the commercial metaverse continues to take a beating in the media. Last week, Diginomica ran a piece that was broadly positive about metaverse applications like education and science, but declared that broad commercial metaverse applications like retail are turning out to be “faddy, improbable, and over-engineered: a complex solution in search of a simple problem”. 

Even when the metaverse manages to glean positive coverage, the end result can take a dark turn. Last month, The New York Times ran a rosy piece about the metaverse as “the next hot housing market”. This prompted much mirth and derision on Twitter, with one poster comparing metaverse real estate speculation with trying to buy land on Mars. 

A recent survey by KMPG found that metaverse investors saw negative media coverage as the biggest threat to their chosen sector, though not enough of a threat to diminish their enthusiasm – research outfit Technavio recently estimated that the global metaverse in entertainment market size “will grow by $33.3 billion from 2022 to 2027” at an annual growth rate of around nine percent. 

Loose definitions

Certainly, metaverse enthusiasm still exists. Recently, author Neal Stephenson (who coined the word ‘metaverse’) delivered a keynote at the game industry DICE summit, titled “Games and the Open Metaverse.” Another DICE session included Blizzard executives on “Creating Universes that Last Decades,” while another focused on the legal complexities of creating and maintaining metaverse games. 

Doubtless, the forthcoming Game Developer Conference will try, and fail, to define the metaverse which, depending on your perspective, covers everything from evil tech oligarch plot, to sci-fi fantasy, to digital scam, to extant and highly successful video games, like Roblox. 

Ball concludes: “Like attention, investment surges and shrinks from time-to-time. However, the secular trends are clear, comprehensive, and consistent. Every year, there are more people in virtual worlds, and they spend more time and money in these spaces, while also considering these activities are more important parts of their lives. Similarly, the technological capabilities and deployment of real-time rendered 3D grows annually, while the interoperability needed to bridge standalone simulations is finally starting to emerge.”