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In October 2021, Facebook made the biggest rebranding decision in modern times. In a bid to make the metaverse mainstream, Mark Zuckerberg announced that the social media giant would pivot to creating a virtual universe, powered by augmented and virtual reality.
The signs that this concept was dead on arrival were everywhere. In 6 months, Meta’s stock plummeted by 42%. However, the buzzword caught on in the industry, and soon everyone was adopting the metaverse. From Disney to Microsoft, and Walmart to NVIDIA, the metaverse was the next big thing in the tech world. Until it wasn’t.
In less than two years since genesis, the metaverse has already met its demise. Companies that have entered the market have been plagued with layoffs, funding is continuing to dry up, and it seems that the world has moved on from this futuristic concept.
Here are five reasons why we’ll never see the metaverse again.
No one wants to use the Metaverse
Meta’s vision of the platform was the poster child for overpromising and under delivering. The introductory video for Horizon Worlds, Meta’s platform, showed flashy graphics and modern-looking avatars. The product in reality, however, looked like a bad video game from the 2000s, with low-quality avatars, bad lip-syncing, and awkward motions. This resulted in a huge loss of the user base for Horizon, which only garnered 300,000 users at launch. It then dropped to 200,000 monthly users, with Meta stopping reporting user count hereafter.
Other platforms like Decentraland also dropped a majority of their users, going from 60,000 to less than 1,000. This completely killed the network effect for metaverse platforms, stopping its momentum in its tracks.
High cost of entry
Apart from the lack of a network effect pushing people away from the platform, there was also a major lack of new users coming on board. This was caused mainly due to the high cost of VR headsets, often cited as a must-have for the metaverse.
Having to spend a lot of money for a headset just to join a platform that many were giving up on just wasn’t enough of a value proposition for users. Moreover, it seems like no one wanted to wear a headset for 9 hours to ‘work in the metaverse’.
It’s nothing new
As much as Mark wanted his metaverse to be the first and only one of its kind, this was far from the truth. The metaverse has been around in some shape or form since the late 90s and early 2000s. Games like EverQuest and Second Life created virtual worlds for players to explore and interact with.
Even today, games like Fortnite and Roblox have created virtual universes for their players, effectively replicating the metaverse dream. These games are more successful than Facebook’s metaverse ever was, and there’s one big reason for that.
Mark’s Metaverse didn’t make financial sense
The metaverse was reportedly developed at a cost of $36 billion to Meta. This number spurred a lot of development in the market, prompting other companies to also begin creating their own metaverse platforms. However, only a few seemed to actually work in an economic sense.
A prime example of this is NVIDIA’s Omniverse platform. By allowing factories to create digital twins of their products, they were able optimise manufacturing processes. Meta’s offering, on the other hand, allowed people to have meetings in the ‘verse and even attend low-resolution concerts. When looking at what the technology is capable of, it is clear that Meta dropped the ball.
No one believes in the Metaverse
A simple Google search will net multiple articles from tech publications decrying the death of the metaverse. Multiple obituaries have already been written for this short-lived technology, reflecting the lack of belief in this technology.
Beyond the users, companies also began to lose faith in the metaverse. Metaverse teams for companies like Microsoft, Tencent, and Disney were the first to go when layoffs started. Meta itself went through multiple rounds of layoffs when the tech recession hit hard.
$36 billion and the end of a hype train later, Meta has moved on to AI, hammering in the last nail in the coffin for the metaverse. While some products might still come out of this momentary spurt of innovation, the idea of everyone living in a virtual reality is delegated to the tech graveyard.