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Editorial Department of this Journal | Zhang Xiaotian
We have no doubt about the long-term value of the Metaverse. First, the sense of realism greatly improves people’s sense of entertainment and participation. The second is that high-precision “digital twins” on the industrial side will greatly improve social production efficiency. Third, it brings the opportunity to experience Second Life and create wealth value. The capital market will remove the false and retain the true. Investors are very sensitive, and Internet companies themselves are also very keen.
Since Roblox, "the first stock in the Metaverse", was listed on the New York Stock Exchange in March last year, the concept of the Metaverse has attracted great attention from investors in domestic and foreign stock markets. Recently, a large online shopping platform also launched “Yuanverse Shopping” during the 618 promotion.
Today, has substantial industrial development been formed under the concept of the metaverse? Which industry areas will new opportunities emerge from this? "Red Weekly" recently conducted an exclusive interview with Wang Jiahua, the leading partner of Deloitte Consulting China Yuanverse Center of Excellence, on relevant hot issues.
The key features of the Metaverse are already in place
Large-scale industrial investment has not yet been formed
"Red Weekly": In the capital market, the concept of the Metaverse has attracted much attention in the past year. There is still no unified standard definition of the Metaverse from an industry perspective. In your opinion, what characteristics should it be understood based on?
Wang Jiahua: Currently, the industry has different definitions of the metaverse. We believe that its long-term development direction lies in "integration of three sectors and governance integration". We also divided into three major scenarios: consumption scenario, industrial scenario and governance scenario.
"Three Worlds in One" refers to the integration of one real world and two virtual worlds into one. The first virtual world is a "digital twin", which is a replica of the real world. Another virtual world is "digital native", composed of new humans, new objects, new rules, and new wisdom created in the metaverse. The emergence of new humans and new objects is that the virtual world of the Metaverse breaks through the time and space limitations of the real world, thereby creating new objects; new rules, such as decentralization, mean that the Metaverse platform hopes to adopt new rules to operate this virtual world. Society; in the future, new wisdom will be produced in the virtual society of the metaverse. Regardless of whether its carrier is a robot, a virtual person, or a program, this intelligence is likely to surpass humans in some aspects. From the perspective of technological development trends, these changing trends are relatively clear and are just around the corner. The Metaverse is not some small-scale experiment, and some key features are already emerging. Such as "decentralization", "local high immersion" and "digital virtual collections circulating across platforms".
In fact, the debate about the definition of the Metaverse may not be that important, because the Metaverse is a thing created based on people's imagination. The important thing is to understand what it means for businesses and individuals, and how to take advantage of it while avoiding the risks it brings.
We divide the applications of the Metaverse into industrial scenarios, consumption scenarios, and governance scenarios. The concepts of industrial and consumer scenarios are similar to the industrial Internet and consumer Internet discussed today. Governance scenarios refer to how virtual spaces develop civilized systems, legal systems, tax systems, security systems, regulatory systems, etc. This is very different from the development of the Internet. Governance issues are a key factor affecting the development of the Metaverse. From the perspective of a single Metaverse platform, its governance method determines what kind of users it attracts and what behavioral norms these users follow on the platform. From the perspective of the entire Metaverse industry, governance determines the future industry structure of the Metaverse. For example, will the future be one metaverse or multiple metaverses? What kind of metaverse is it? Just like 20 years ago, we would ask "how many Internet platforms will there be in the future?"
uses a popular way to explain the governance issues of the metaverse. For example, different civilized tribal groups may be formed in the metaverse. You may have created a metaverse platform, with your own vocabulary and context, and a group of people who love to play with you. I also made one, and a bunch of people loved playing with me.These rules can rise to the level of civilization. These civilizations, governance, and security are equivalent to the basic system of our real society. I think these will determine the development direction of the metaverse and their competition and cooperation relationships in the future. This is our view of the metaverse. A basic understanding.
"Red Weekly": The Metaverse actually involves multiple industrial links from basic hardware, data transmission to content applications. Have relevant companies currently begun large-scale investments related to the Metaverse?
Wang Jiahua: Many Yuanverse solutions or product providers have already made large-scale investments, including some start-up companies. Their business is a solution for a certain segment of the Yuanverse. From the perspective of enterprise application metaverse business, I think the substantial investment momentum of enterprises has not yet arrived. Some related companies have indeed begun to invest real money, and some absolute amounts are quite large. But judging from the proportion of these investments, it has not yet reached a "substantial" level. Most of the companies we come into contact with are still exploring, researching, and waiting to see. In addition, for companies that currently use the Yuanverse for marketing, the proportion of related expenses in the overall marketing expenses is also very small. As far as we know, in the Yuanverse platform launched by a large domestic Internet company, the automotive industry and fast-moving consumer goods industry are indeed involved in establishing virtual stores or conducting marketing activities. But compared to the billions of marketing expenses these companies spend every year, their expenditures on the Yuanverse platform are still in the millions to tens of millions, which is still a relatively small proportion.
"Red Weekly": Are the current basic conditions such as virtual reality technology and communication technology sufficient to support the Metaverse? Are there any bottlenecks?
Wang Jiahua: There have been major breakthroughs in hardware support in the past two years. Taking AR and VR equipment as an example, their frequency refresh rate has reached a new level, and shipments have reached tens of millions. From another perspective, hardware equipment and technology may not necessarily restrict the development of the Metaverse. For example, Roblox, known as the "first stock in the universe", had been developing for several years before it went public in February last year. At a time when hardware equipment was still relatively backward, the key to its appeal lay in its gameplay and modes. It launched UGC, which was to provide users with basic tools for them to fully create. In contrast, Meta can be said to be another representative, which particularly pursues a sense of realism. Hardware can solve the problems of realism and immersion, but innovative breakthroughs in rules and modes are also critical. If any platform does well in both aspects in the future, it will be a particularly excellent Metaverse platform.
It is worth noting that the related technologies for improving realism are changing with each passing day, and there are many examples. In the stage of the Internet we are currently in, auditory and visual experiences have reached a high level. Just recently, there have been new breakthroughs in haptic-related technologies. For example, Carnegie Mellon Institute has launched an experimental product that can simulate the feeling of human kissing. When it determines that the other person has made a kissing action, it will use VR equipment and ultrasonic arrays to create the feeling of lips and teeth being touched. These technologies can also simulate the feeling of brushing teeth or the feeling of caterpillar crawling across the face. More difficult olfactory experiences are now making breakthroughs. Currently, some small chemical molecules are used in AR or VR devices to allow people to hear and ask questions.
If we now imagine the ultimate stage of the metaverse, then the brain-computer interface will bring fundamental changes. Elon Musk 's NeuraLink laboratory can simulate monkeys' brain waves by implanting chips and artificial intelligence to make monkeys perform specific actions. Of course, this kind of experiment is ethically controversial. Some animal rights activists and organizations will think it is too cruel. However, brain-computer interface technology will always continue to develop as a science. If there is a further breakthrough in brain-computer interface technology, through brain Radio wave signals can achieve realistic feelings and sensory experiences. The development of basic hardware such as
chips is even faster. According to the prediction of "Moore's Theorem", the speed of chips will increase 100 times in 10 years.In fact, in the past 10 years, the computing speed of human chips has increased far beyond Moore's Theorem. Google recently launched a new generation of TPU PoD (tensor processor, a chip specially developed to accelerate the computing power of deep neural networks). The processing power has reached 100 pFlops, that is, one billion billion (10 to the 17th power) per second. ) times floating point operations , which is equivalent to the sum of the computing power of 10 million commonly used computers.
Therefore, whether it is technology that achieves realistic body sensations or AI computing that achieves new intelligence, there may be some gaps with everyone’s expectations for the Metaverse. There are some technical bottlenecks that need to be broken through, but the speed of technology development will be faster than most People expect it to happen faster.
XR hardware or new traffic portals
Industrial applications will bring about qualitative changes in the metaverse
"Red Weekly": These cutting-edge technologies require a large amount of R&D capital expenditures by enterprises to support them. Looking at it from another perspective, will the rise of the Metaverse concept drive companies to increase investment in research and development of related technologies, especially chip and other hardware manufacturers?
Wang Jiahua: will indeed promote the rapid development of these hardware, because these hardware need to find application scenarios, and the Metaverse is a good scenario, and it is a big scenario. Take chips as an example. Before the concept of the metaverse emerged, chips had already been diversified, from CPU to GPU to DPU, to meet the needs of more subdivided special scenarios. For example, some chips are specially used to handle some scenes of driverless cars. Now, everyone will also develop xPU suitable for Metaverse scenarios.
Some special tracks may require more investment. For example, AR and VR terminal equipment. Now many Internet giants and emerging startups have seen that part of the traffic portal role played by mobile phones will be transferred to AR and VR. Everyone will increase their investment in order to seize this entrance. Several major domestic Internet companies are developing XR (extended reality) and have their own hardware equipment products. Unlike manufacturers that only produce AR and VR devices, Internet platform companies can provide a complete end-to-end solution for the Yuanverse, forming a mutually reinforcing situation with XR, the traffic portal, and are in a more favorable position.
"Red Weekly": Speaking of scenarios, domestic and foreign industrial research institutions and investment institutions have recently begun to look forward to the specific application scenarios of the Metaverse. Among them, gaming, education and other scenarios are not difficult to understand, but how to understand the combination of the metaverse and industrial manufacturing activities?
Wang Jiahua: A representative feature of the metaverse is the creation of a virtual environment. For industrial manufacturing activities, the environment created by the Metaverse is the product production environment, including factory space, production lines, and the products themselves. These are some of the technologies that fall into the category of digital twins, which have emerged a few years ago. Digital twin technology also applies in the development process of product .
But in industrial scenarios, simple two-dimensional to three-dimensional transformation cannot fully tap its potential. In order to greatly improve production efficiency, we actually need to replicate the real world very deeply. For a production line, a machine, and an engine, not only must the sensory 3D reproduction be achieved, but its internal mechanical characteristics, physical space characteristics, electrical characteristics, etc. also need to be reproduced. This requires the in-depth integration of digital twins and other technologies, such as the Internet of Things, artificial intelligence, etc. Compared with earlier applications, this kind of in-depth digital twin application has changed from quantitative to qualitative. Second, in the production environment, some metaverse elements will be comprehensively applied, such as AR access, robots, etc.
"Red Weekly": We can control the production line in the real world through the virtual production line in the metaverse to improve efficiency, is that right?
Wang Jiahua: yes. In fact, the industrial scene of the Metaverse is to achieve this combination of reality and reality. This first requires connecting the virtual production line with the actual production line. This is the industrial Internet or the Internet of Things. In the future, there will be many sophisticated Internet of Things sensors . Second, we must deconstruct the real world very well. In order to achieve such an effect: the parts in the virtual society can be disassembled. The process is the same as in the real world.Third, these sensors enable the virtual production line to control the real production line. This is a very representative scene.
"Red Weekly": Whether it is a consumer scenario or an industrial scenario, the Metaverse will generate data more intensively. Coupled with the characteristics of virtual reproduction, the relevant regulatory rules seem to be more complex. What are the latest developments in this regard at home and abroad?
Wang Jiahua: involves the governance of the metaverse. The regulatory rules related to the Metaverse are not only complex, but have also become a real problem before us. A more representative case is that not long ago, there were complaints of sexual assault in the Metaverse platform in the United States. This is largely because the platform’s body feel is too realistic, making users feel violated. This case fully demonstrates that the virtual space of the Metaverse is highly similar to the real society and also involves legal issues. For another example, regarding the taxation issue of Yuanverse’s virtual digital products, should they be classified as financial assets or intangible assets? As we all know, you can now buy a house in the metaverse, and the logic and pricing rules are almost exactly the same as in real society. Although this is a digital virtual code written based on a program, its value chain is exactly the same as in real society. How to formulate tax laws and policies when virtual products are so easily confused with actual products? These problems have already arisen.
In addition to these "special" problems, the Metaverse, like our current Internet, also needs to solve the problems of data security and identity recognition in virtual society. All these rules are equivalent to the basic system of our real society, which will determine the development direction of the metaverse and the competition and cooperation relationships between different platforms. In the development process of
Metaverse so far, governments of various countries have become more sensitive to privacy issues and governance issues than before. Our Chinese government is more cautious. From a technical level, privacy issues, security issues, governance rules and other issues are all based on blockchain. China has elevated blockchain to a national strategy since 2019, and there are already some think tanks studying the governance issues of the Metaverse.
The Metaverse has five major long-term values
Large Internet companies have natural advantages
"Red Weekly": The social media giant Facebook changed its name to "Meta" at the end of October last year and made an all-out effort to enter the Metaverse business. But since then, the company's stock price has fallen sharply, and its market value has dropped by nearly 40%. Does the capital market seem wary of the development of the Metaverse?
Wang Jiahua: is indeed vigilant. But this does not mean that the capital market believes that the value of the Metaverse is not high. In my personal opinion, the decline in Meta's stock price is mainly due to the fact that its existing main business is not as good as expected. There have been a large number of investments involving the Metaverse in China recently, and there is also some element of speculation in this. I think this is a normal phenomenon in the capital market.
But we don’t doubt the long-term value of the Metaverse itself. First, the sense of realism improves people’s sense of entertainment. The second is the huge improvement in the efficiency of the real world that various applications of the Metaverse have (such as AR education, "digital twin" production line reproduction, etc.). Third, the Metaverse brings the opportunity to experience a second life. The work of most of us only represents a part of our abilities and interests. In the metaverse, we can realize a second life; fourth, there is an opportunity to release creativity. For example, there are various games in Roblox developed by ordinary individual users; fifth, opportunities to create wealth value. The Metaverse continues to remain popular. In addition to the hype instinct of capital, the inherent long-term core value will drive the Metaverse forward. The capital market will remove the false and retain the true, and investors are very sensitive to identifying business models and enterprises driven by these core values.
"Red Weekly": The current pattern of China's Internet industry seems to be relatively stable. Is it possible that the development of the Metaverse will create new giants, leading to the reshaping of the industry pattern?
Wang Jiahua: The possibility of exists, and it is more likely to happen abroad. In terms of the element resources needed to develop the metaverse, the only companies in the world that have inherent advantages in these elements are Internet companies.
First of all, the end-to-end Metaverse solution includes many technologies, from XR on the access side, to game engines on the application side, to technology platforms such as AI and blockchain, to cloud, IIoT, etc. at the basic capability layer. Except for large Internet companies, few companies have these technologies at the same time.
Second, Internet companies have their own massive users.
The third is the financial advantage, which can obtain the capabilities they want through mergers and acquisitions;
The fourth is the sensitivity and awareness of change of Internet companies. In terms of technology-driven social and economic changes, Internet companies are much more sensitive to technology than ordinary people and ordinary companies. Before Facebook changed its name, several major domestic Internet companies had already begun their layout. From the perspective of change consciousness, China has experienced several major changes in the development of the Internet in the past 20 years, which have made Internet companies more mature, resilient and change-conscious. The first is from the Internet to the mobile Internet, the second is from the mobile Internet to AI, and the third is companies that rely on business model innovation to grow and prosper in the gaps between giants. Every time
changes, new companies grow up around these Internet giants, and reach the same level and rise to a higher level. Coupled with the recent impact of the country's vigorous promotion of hard technology. After experiencing these changes, our country’s Internet companies should be said to have become increasingly mature. It is relatively difficult for new innovative companies in the metaverse era to surpass these Internet companies. At present, we have not seen any such obvious signs. Of course, the historical law that it is difficult for large companies to make a U-turn and innovate has always existed.
In comparison, the United States is innovating relatively quickly in the metaverse, and some companies of certain size have emerged, including Roblox, Decentraland, Sandbox, Opensea, etc., as well as the recently popular application STEPN.
(This article was published in "Red Weekly" on May 28. The opinions in the article only represent the individual guests and do not represent the position of "Red Weekly". The mention of individual stocks is only for example analysis and does not make trading recommendations.)
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