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Business Virtual Reality

The Battle for the Metaverse in 2020

Wow, this year did not start off with the BANG that I thought. I woke up New Years Day with a terrible headache that turned out to be a sinus infection. I now, finally feel like myself again.

In that time I saw a slew of 2019 VR/AR recaps and 2020 tech predictions and analysis go out. I curated my own little list at the end of the year. Out of all of that, two posts caught my eye. A Forbes article Navah Berg shared with me on Twitter and an editorial by Ryan Schultz.

In 2019, virtual reality seemed to perforate the business world. Use cases for virtual reality in corporate training, manufacturing, prototyping, and communication flooded my social feeds.

Social VR on the other hand, seems to still struggle. It has yet to find its user base. Unlike virtual reality games and enterprise solutions, social VR is plagued with uncertainty. It’s the wild west of avatar interaction.

My own experience in social VR, VTime, was not so great. I left the app in rush after a creepy encounter with another VTime user. The company assured by most of the people on their platform are not like that. And there are tools to block out people I don’t want to interact with.

What other social app is out there that the first thing they teach you is how to block other people and create personal bubbles? It’s hardly social. Yet, figuring out how to create safe virtual spaces is a real problem VR developers are trying to solve.

That’s why Facebook’s social VR app, Horizon, requires people to be themselves. They believe if people are avatars who look like themselves, have their own names above their heads, and are linked to their real Facebook accounts, then harrassement shouldn’t be as bad. The first thing people can do is play and interact because they aren’t anyonmyous.

This idea isn’t new. The Well (one of the first online bulletin boards) had a policy where people had to be themselves. The creators of The Well realized that, negativity is amplified and becomes much louder than positivity. Even with this in mind and people required to use their real names on The Well, moderators had to be put in place to fan the “flame wars” that would ignite.

Ryan Schultz, pondered in his blog post if Facebook Horizon can succeed if you can’t be anyone but yourself. He looked back on his 14 years in Second Life: “Second Life has been an unparalleled opportunity for literally hundreds of thousands—even millions— of people over the past 16 years, to step outside their own skins and become somebody else for a day, a week, a month, a year…or forever.”

I thought he made a rather insightful comment: “Fourteen years of Second Life has taught me that the ability to be somebody else—walk around in someone else’s skin—can be an insightful, instructive, transformative, and even delightful experience.”

“Fourteen years of Second Life has taught me that the ability to be somebody else—walk around in someone else’s skin—can be an insightful, instructive, transformative, and even delightful experience.”

Ryan Schultz

Virtual reality is supposed to be a place where you can make anything happen, be anything or anybody. You don’t have to be stuck to reality. The original creators of VR saw it as a mechanism for anyone, you and me, to create and build in an intuitive way. Instead, we are tied down by the corporate behemoth, Facebook, who is designing a virtual ecosystem not with you in mind, but themselves. Every action we take, every piece of data we give them, is meant to feed back into their advertising algorithms.

Maybe for the audience Facebook is trying to capture, that’s fine. They do have over a billion people on their social network. They did sell out of the Oculus Quest over the holidays (whether that’s because they didn’t build enough in the first place is yet to be determined). However, Facebook is bleeding younger users. Perhaps the Quest is a way to rope younger players back into their social fold.

Facebook is the expert is social, right? But maybe they have it all wrong. Perhaps it’s not blocking, muting, and personal bubbles that makes social VR work. Maybe it’s the ability to attack and defend yourself.

Navah Berg shared a Forbes article with me about how Fortnite is building the Metaverse. Fornite is a battle royal style game where players also have a social connection to their friends. It’s not virtual reality but it has all makings to be the free-for-all metaverse that virtual reality brings to mind.

The author of the article, Paul Tassi, writes, “Fortnite is building, a shared virtual world where players and brands and IPs all collide and coexist in a myriad of ways. For playing games, yes, but also for…everything.”

In Fortnite, you can be the Black Widow, Rey, Finn, or Kylo Ren, Batman, or your favorite NFL player. These are all possible because of Fornite’s relationships with these big name corporations.

Tassi believes that, “Epic wants to own and run the biggest virtual space in gaming, and perhaps the entire internet…” With the Unreal game engine, corporate relationships, and plethora of young users, we could see the real social VR emerge.

Who are the users?

Is social VR and the metaverse going to be made of of my generation? Gen Z is the first to be on the other side of the digital divide. But as we grow older, start families, and realize the detriment of social media, are we the best market for social virtual reality?

My theory is that the social VR with a purpose is going to be the one to win out. Why enter the social VR? To “hang out with friends” it not a strong enough argument for me. “Hanging out with friends” isn’t intellectual property.

I went to AltspaceVR specifically for VR Book Club meetups. People go to Fortnite to play the game. People go to Rec Room to play games. If all Horizon has is another option to play games and hang out with friends, that’s not a big differentiator. Especially with their failed past attempt with Facebook Spaces.

Facebook vs. Fortnite

Facebook

  • Facebook has 2.41 billion monthly active users.
  • Teen use is going down of Facebook. Only 51% of teens use the site. According to Pew Research, that number is down from 71% in 2015. (And only 10% of those teens say Facebook is the social network they use most often.)
  • According to eMarketer just 40.5% of 12 to 17 year-olds use Facebook. They expect that number to drop to 37.1% by 2022.
  • Seniors are the fastest growing group on Facebook. “eMarketer predicts Facebook will see 7% growth in users 65 and over” in 2020.
  • 63% of men use Facebook compared to 75% of women.

(Stats from Hootsuite)

Fortnite

  • As of March 2019, Fornite had 250 million users.
  • According to Newzoo, 53% of Fortnite players are 10-25.
  • 62.7% of Fortnite players (excluding those younger than 18) are aged 18-24 (according to one analysis).
  • 72.4% to 83.7% of Fornite users are male.

(Stats from Business of Apps)

Time Spent

According to broadbandsearch.net and businessofapps.com:

  • People spend 58 minutes a day on Facebook which is about 6.7 hours a week.
  • 32.5% of Fortnite users spend 6 – 10 hours playing.
  • Facebook has 22 million monthly active users.
  • In August 2018, there were 78.3 million active Fortnite players.

Business Model & Revenue

Facebook is an ads based business model. Its main source of income is digital advertising.

In 2018, Facebook reported $55.8 billion dollars in revenue.

Fortnite is a free-to-play game. It has in game purchases like the Battle Pass for $9.50.

Fortnite’s revenue in 2018 was $2.4 billion. I’d say that’s pretty good for a one year old company (Fortnite was released in 2017).

Facebook is still a behemoth of a company with 2.41 billion monthly active users. But active users on the social media site does not necessarily translate to successful social VR.

Fortnite may be young, but it’s passionate and active base of young players plus the company’s vision towards a platform make it a powerful contender in the wold of metaverses.

Which user group will more successfully translate to active social VR players? Is it Facebook’s female heavy, older population or Fortnite’s younger, higher percentage male players? Is being yourself in social VR the key to a playable world or is it being Batman with a Battle Pass?

Facebook and Fortnite are two very different companies. One is a digital advertising and marketing company, the other is a game published by Epic Games. Yet, we see the two heading into competition over the metaverse. Only time will tell which is the victor.

Who do you think is the victor? What do you want out of social VR? Let me know in the comments below!


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Featured Photo by Sean Do on Unsplash

3 replies on “The Battle for the Metaverse in 2020”

Great article Lily! I believe Social VR will be a major aspect of our digital future. I’m not sure how I feel about requiring avatars to be the real person behind them. In fact, it’s probably impossible to enforce it. Being anonymous on the internet is part of it’s attraction, but it’s also problematic due to harassment and trolling. Perhaps a compromise requiring users to register with a real identity, but allowing them to portray different avatars in “public.” I think if users are required to register with personal identification, it might cause them to think twice before engaging in bad behavior.

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