“China’s metaverse will part ways with the Internet in the rest of the world, just as the Internet in the United States will part with the Internet in the European Union, and the Internet in Southeast Asia.”
In 1990, Chinese scientist Qian Xuesen suggested in a handwritten letter to a friend that the word “Virtual Reality” should be translated as “spiritual realm”. 30 years later, “virtual reality” has become the hottest future technology for mankind. In 1992, American science fiction writer Neil Stephenson coined the term “Metaverse” in “Avalanche”, which was translated as “Super Metaverse”. Also 30 years later, another translation of the word, “metaverse”, once again caught everyone’s attention.
Whether it is artificial intelligence or virtual reality, or blockchain and Web3, the concept of metaverse embraces these technologies that have been born for decades, and appears again and again in people’s prospects for the future. But what kind of impact it will have on human business society, how far away from human life is, and whether it can represent the next generation of the Internet revolution still needs to be further answered.
Matthew Ball, the managing partner of venture capital fund EpyllionCo., is one of the first people to think about the business transformation of the Metaverse. Since January 2020, he has published a series of essays on the theme of the Metaverse, which was The Chinese translator compiled it into “Metaverse Nine Chapters of Arithmetic”. In 2021, when the metaverse is popular all over the world, he will compile his thoughts on the metaverse into the book “Metaverse Changes Everything” (Publisher: Zhanlu Culture/Zhejiang Education Press). In July 2022, Time Magazine’s latest cover featured its feature article “Into The Metaverse: The Next Digital Era Will Change Everything”. As such, Matthew Ball is also seen as a business pioneer in the Metaverse.
The following is the transcript of Jiemian News’ interview with Matthew Ball, the content has been edited to some extent.
The Metaverse Takes Everything
Jiemian News: The ten largest Internet companies in the world are basically from China and the United States, among which Facebook has taken the lead in marching into the Metaverse. What impact and revolution will the new Metaverse companies and projects bring to the current Chinese and American Internet giants?
Matthew Ball: I would say that most of the top companies in the world, not just Internet companies, are actively deploying the metaverse. This includes Facebook, but also Google, Apple, Amazon, Microsoft and Tencent. At the beginning of 2022, these 7 companies are all among the top ten listed companies in the world (note: Tencent is no longer in the top ten due to shrinking market value).
And these giants are investing tens of billions of dollars in varying degrees, rewriting their corporate visions, reorganizing their businesses, and preparing to release the latest products in recent decades. When it comes to why they invested in the metaverse and the potential impact, history tells us the answer.
Whenever we face a new wave of computing devices, such as from mainframes to PCs, and from PCs to mobile computers in the cloud, we see huge changes in the market. This change brings both the potential for growth and the opportunity for income diversification.
In the tide, we can see five different types of corporate fortunes. The first category is “no longer”, the company is completely destroyed, Blockbuster in the United States is a famous example. The second category is when companies survive, but they are far surpassed by new companies. Yahoo was once one of the largest internet companies in the world, but in the era of the mobile internet it was left behind and no one would think of Yahoo anymore. A similar example was Skype, which at the time was the largest communications platform in the world. But now, its user base is small compared to apps like WhatsApp, Instagram, WeChat, etc.
The third category is companies that have grown through new markets. Facebook is a company that was founded before mobilization, but became bigger because of mobilization. The fourth category is those companies that have been displaced in their core markets but have been boosted by the growth of the digital economy. Microsoft’s market share in computing devices has long since peaked, but today Microsoft is more valuable than ever. The fifth category is new businesses emerging in the mobile age, including Snapchat and Tik Tok.
So the metaverse’s broad impact on head businesses is one of those five fates: from destruction to rebirth, from displacement to growth, or oblivion over time. That’s why every company with cash, resources, talent, and ambition is laying out the metaverse today.
Jiemian News: With the gradual development of the metaverse concept, what new business models and business opportunities will emerge?
Matthew Ball: It’s a fascinating question because, in the end, time will reveal the answer. For example, the Metaverse will bring new opportunities for the sale of virtual clothing. Fortnite generates more revenue each year than any game in history, and almost all of that revenue comes from the sale of virtual goods.
Moreover, those revenues actually exceed the clothing sales of many of the most successful fashion houses in history, such as Gucci and Prada, as well as musician Rihanna’s fashion brand Fenty. In addition to this, we also see new classifications. Metaverse will have virtual architects, virtual teachers, and virtual performers sitting at home performing a stage play or performance.
In general, we believe that the metaverse will eventually reach almost every category, every industry, every country, every person, but we don’t yet know exactly how this will change society and what we want to do . The business models I mentioned earlier can also be disrupted and replaced by new companies because the future is unpredictable. If the future is predictable, we won’t see changes in who will lead.
Jiemian News: The existing Internet facilities cannot fully realize the “metaverse” experience that everyone expects. What technical obstacles do you think the metaverse is currently facing?
Matthew Ball: Yes, the metaverse faces a lot of technical challenges. For example, we don’t yet have enough network infrastructure for everyone to participate in the metaverse. In fact, even those with high-speed internet often struggle to play video games in 3D because the data takes a long time to load.
And the computing power required by the metaverse far exceeds what we currently have. For decades, we have underestimated the computing power we need. Oculus CEO John Kaman said 20 years ago he would have thought the metaverse could be built with existing computing power, but in 2021 he discovered that the metaverse would actually require far more computing power than he thought Much, it will be 10 years or more before we realize the metaverse without major concessions, compromises, and deficiencies. So I think our demand for computing power will far exceed what we currently have.
We’re also thinking about new hardware, and VR headsets and AR headsets are not a hard requirement for the metaverse, just like touchscreens aren’t a hard requirement for mobile devices. But just like touchscreens, we believe these new interfaces and devices are important to how we get into this new world, who gets into it, and for what. However, we don’t currently have the technology to produce wearables that work for everyone. It has a lot of requirements, such as being powerful, having the sensors we need, being inexpensive, having a battery life long enough, and being light enough to be worn on the head. Mark Zuckerberg once said that this is the biggest technological problem of our time, and we need advances in technologies such as battery optics, sensors, and computing processors to overcome this problem, and it will take a while.
Interface News: Which Metaverse products or Web3 tools impress you?
Matthew Ball: I think one of the most impressive metaverse demos came from Microsoft Flight Simulator. Microsoft Flight Simulator is a reproduction of the entire world, it includes trillions of individually rendered buildings, trillions of individually rendered trees, not replicating the speed of the same tree, but individual trees, almost every road building, school and Airport. When you experience it, you will understand why we are talking about the metaverse now, because it is becoming possible. When you try Microsoft Flight Simulator with a high-end VR headset, the experience feels extraordinary. But right now, most devices can’t run Microsoft Flight Simulator. But we believe in the speed at which technology is advancing, and soon it will be available to all of us.
Blockchain and Web3
Jiemian News: Blockchain technology has brought many new things such as Bitcoin, Ethereum, NFT, DAO, etc. It has also produced market bubbles related to speculation and wealth. What do you think of blockchain technology?
Matthew Ball: People have mixed reviews about blockchain.
Now, these blockchain networks are too expensive to use. And it’s important that decentralization has problems with efficiency and also has an impact on the distribution of power and the influence of governments. But there has also been discussion about what blockchain could be an important system for interaction, as it allows users to own virtual goods that they can take elsewhere, and provides communities of individuals with more tools to build their own businesses, which is critical to any economy growth is essential.
Jiemian News: Ethereum is currently the largest decentralized computing platform in the world. People are building it into an increasingly complex and dynamic ecosystem. Will it be the prototype of the Metaverse?
Matthew Ball: I would describe the metaverse as a third-generation virtual network world, but I wouldn’t describe Ethereum as a metaverse, it’s probably not a requirement of the metaverse. But what we’re seeing is that Ethereum can bring communities together by giving them tools to collaborate, coordinate more effectively, and build businesses, products, and experiences of extraordinary value and meaning. It’s not the metaverse, but it’s fundamentally tied to the growth of the metaverse, a holistic view of our time, our work, our energy, our relationships, our happiness, and our creative achievements. Growth share, in digital form, not just in the real world.
Jiemian News: NFT is very hot all over the world now, and the boring ape has become a new fashion brand, but it looks no different from a picture. What do you think of the emergence and popularity of NFTs?
Matthew Ball: What the Boring Ape represents is membership in a community, ownership of individual intellectual property, and group ownership of intellectual property by large communities that don’t own the Boring Ape but are fans of it Supported, just like any Disney or Marvel fan.
Beyond that, it’s backed by those who want the cryptocurrency ecosystem to thrive, they’re excited about new creators and new pure-play virtual businesses, and that’s what counts. The Boring Ape represents community and consensus, not personal image. For the same reason, we may find that the Boring Ape itself does not confine itself to an early but ultimately unsustainable ecosystem based on cryptocurrencies. What matters is not the image, or even the technology of the NFT. The Boring Ape represents the community behind the next generation of the Internet.
Jiemian News: Together with the Metaverse, “Web3” is also known as a new concept that attracts the most attention at the moment, and is also regarded as the next-generation Internet form. What is the difference between the Metaverse and Web3?
Matthew Ball: That’s a good question. These two concepts, the metaverse and Web 3.0, are often mixed up because the metaverse is described as the next version of the Internet in 3D. Web 3.0 is described as the next decentralized version of the internet. Two things that closely follow the current situation naturally intertwine. But the Metaverse is an interoperable network of 3D virtual worlds. Web 3.0 focuses on decentralized infrastructure, and the metaverse may be driven by decentralized infrastructure. Perhaps decentralized infrastructure is the best way to build a metaverse, but they are different ideas.
China and the Metaverse
Jiemian News: In the preface of “The Metaverse Changes Everything”, you wrote that “China may be the most likely place to realize the metaverse”. How will the Chinese metaverse be different from the metaverse of the Western world?
Matthew Ball: Neither China nor the West have realized the metaverse at the moment, so we’re talking about a vision of the future. The challenge for the West is whether nations can fully and broadly establish a freely interacting metaverse, as this is a platform that needs to host billions of people interacting. Can all Western companies, virtual worlds and applications be interoperable today? Getting to that point requires national exchanges, cooperation and agreement. And China is better at community strength and national interoperability. So my expectation is that the Chinese metaverse will be more comprehensive and functional, and it may come sooner. There is good evidence of this right now, not only in relation to different cultures, governments and community-oriented principles and organisations, but also the state of the internet. In China today, we are seeing increasing usage of digital platforms. QR codes and mobile payments are at the center of the Chinese economy, and their penetration rates are much higher in China. As a result, China’s path to a more comprehensive metaverse is both shorter and closer.
Jiemian News: Which Chinese company is most likely to occupy the core position of the Metaverse?
Matthew Ball: I don’t know the answer, I think, because the future is likely to see significant growth in new companies and a major change in the fortunes of all companies today. The heart and core issues are also slightly different. The technological core and core of a platform, an era, and a society are different questions, and they should have different answers. But in 2020 and 2019, I was often asked which company is closest to the Metaverse today. Everyone thought the answer was either Epic Games, Roblox or Facebook, and my answer was always Tencent. While Facebook has rebranded itself as Meta and become a bigger, more core metaverse platform, I still think Tencent is closer to the metaverse. The scope and responsibility of the virtual world is very large. In the digital economy, it is the most important payment platform in the world. Of course, WeChat is the basic technology of modern society. So I think it’s easier than any other company today to build an interoperable network of experiences and nurture a new computing platform.
Jiemian News: We know that the fierce competition between China and the United States in the field of technology is continuing. Will this competition continue into the metaverse?
Matthew Ball: Every nation is moving towards the metaverse. We saw Dubai’s crown prince recently announcing his plans to make Dubai the center of a metaverse. The EU is moving very rapidly from legislation focused on the Web2 era to the metaverse. And in the US, people are increasingly concerned about the power of domestic virtualization and computing models, and increasingly relying on their own technology, rather than technology imported from other places, whether it is China or other countries.
I don’t believe this process will necessarily create competition. But we should continue to expect China’s Internet, China’s metaverse will be parting ways with the rest of the world, just like the Internet in the US is parting ways with the Internet in the EU, the Internet in Southeast Asia, and many other markets, such as Canada, where I’m based, are increasingly Turn to the European version of the internet. therefore
, I think we’re going to see more and more differences between the internet and the metaverse all over the world.
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