Who is the life-saving straw of the Metaverse in 2024?

Source: Metaverse Sunburst

2022 is called the "First Year of the Metaverse". The tentacles of technology attempt to place everything that can be digitized in a world composed of 0 and 1, and map out the relationship between time and A virtual extension of space.

The virtual city written by Neil Stephenson develops along a 100-meter-wide road. Electronic signs on the buildings spread in the dim neighborhoods. People can enter this highly free place through virtual reality glasses. , developed cities, purchase virtual land and develop buildings.

In the year 2023 that has just passed, the influence of the Metaverse concept on a global scale has been declining. Whether it is Google Trends, Baidu Index or WeChat Index, if you search for keywords such as "Metaverse" and "Metaverse", the popularity curve will drop off a cliff.

The complete emergence of the Metaverse concept will begin when Facebook’s parent company changes its name to Meta in 2021. Capital and Internet giants were the first to take notice. Roblox, a platform focusing on game creation, became the first stock in the Metaverse. Tencent, Alibaba, Domestic giants such as Baidu have made plans.

The metaverse, described as the "3D Internet", was almost equated with the "future world" for a while, but it was pushed back to the concept stage within two years. The vision was too big, the global economy was in decline, and the Metaverse was abandoned by capital and questioned by users before it even took shape. When "artificial intelligence" became the new technology favorite in 2023, the Metaverse became an "abandoned child" of capital, and Pico, which was updated to the fourth generation, stagnated.

The difficulty in the implementation of the Metaverse is that the future it depicts is too advanced. It requires almost all new technologies, such as AR/VR (software and hardware), 5G (computing), artificial intelligence (virtual life forms), area Blockchain (economic system) and so on.

As an entrance, the XR industry has not achieved breakthrough development in the past 10 years, and social, entertainment and other activities that occur in the virtual space have also been constrained by this. This has also made virtual people, virtual goods NFT, and virtual venues indispensable. Appears ineffective in the metaverse.

Even so, some builders who believe in it are still working on it. While Meta closed the Metaverse space due to benefits, it also released the Meta Quest 3 head display to continue upgrading the hardware; Apple is also stepping up the research and development of spatial computing hardware Vision Pro, and the first model is expected to be launched in January 2024; Samsung restarts The XR hardware plan is also intensively preparing new products.

Open the channel. In 2024, head-mounted display hardware will be the glimmer of light shining into the desert of the metaverse.

01 The bubble bursts and the industry is under pressure

The most famous Metaverse company is Facebook’s parent company Meta, which once planned to invest US$70 billion , with a ten-year deadline for All In the Metaverse.  In 2023, this company with Metaverse in its name has not entered the ideal metaverse.

Last year, Meta shocked the industry with the "largest layoffs in history". 11,000 employees were laid off. The cut projects included wearable devices in the Metaverse division Reality Labs.

Behind the layoffs is a question of profitability. In the face of the global economic downturn in 2023, Zuckerberg called last year a "year of efficiency", with the company "more proactively getting rid of" projects that were underperforming or not absolutely necessary.

Meta’s financial report shows that in the first three quarters ended September 30, the company’s total revenue was US$94.791 billion, a year-on-year increase of 12%. Meta's revenue structure is divided into two parts: the first is the application software series (Family of Apps), which contributed revenue of US$93.666 billion, a year-on-year increase of 13%; the second is Reality Labs, which generated US$825 million in revenue, a year-on-year decrease of 42%.

When discussing the results, Meta management said that in the first nine months of this year, Reality Labs reduced the company's overall operating profit by approximately $11.47 billion, and that the segment's operating losses are expected to increase significantly in 2024. .

When cost reduction and efficiency improvement became Meta’s main theme, some of its metaverse plans pressed the pause button. Recalling when Meta first entered the metaverse, this track was very popular both overseas and domestically.

The gaming platform Roblox became the first stock in the Yuanverse in 2021. The stock price soared 54.4% on the first day of listing. In just one year, the company's market value increased from US$4 billion to US$45 billion. Japanese social gaming giant GREE announced that it will launch metaverse business. Microsoft announced its enterprise Metaverse solution at the Inspire global partner conference.

Domestically, ByteDance spent huge sums of money to acquire the Chinese VR startup Pico, and Alibaba, Baidu, etc. have also entered the Metaverse, fearing that they will miss the opportunity.

Now, if you search for "Metaverse" again, the popularity curve is all the way to the ground.

The popularity of the Metaverse has plummeted (from Google search)

After Meta began to shrink, global companies also began to "retreat" from the Metaverse track.

Meta originally planned to produce  700 Quest 3 in the second half of 2023 in the second half of 2023, but it has now been adjusted to 200 to 2.5 million units. In 2024, Meta is expected to ship fewer units to 1 million units.

Two years after being acquired by Bytedance, Pico shrank significantly, with the team size shrinking from 2000 to about 1000. According to IDC 2023 first half data, in the past two years, Pico has maintained a market share of close to 60% in China, but in terms of business volume, it is difficult for Pico to make contributions to Byte Too many contributions. Just at the beginning of this year, Pico lowered its annual sales target to 500,000 units, a figure that shrank by 50% from last year.

In 2023, Tencent almost disbanded the XR team and announced that it would change the hardware development path. Xu Chen, the company’s head of XR content ecology, resigned. Dream Bloom, a VR company owned by iQiyi, was revealed to be in operating difficulties. About a hundred employees, including current and former employees, were owed wages and business was basically stagnant.

The entire industry is under pressure from the bursting of the Metaverse bubble.

02 The collective "empty city" of virtual space

Hardware sales are not ideal, and the metaverse space is also half-dead.

In 2022, the Meta virtual world platform Horizon Worlds officially took the first step to make the Metaverse a reality. However, the internal world is not as glamorous as the platform’s trailer. Three months after its launch, there were only 300,000 monthly active users.

Last year, some netizens broke the news that Horizon Worlds actually had only 38 real users. A Youtube blogger personally investigated and found that although the real situation is not as "miserable" as the news said, it is far from optimistic. Horizon Worlds' daily active users are most likely only about 1,000 people. He then tried to count the total number of players on the top 20 virtual planets on the popular list, and found that there were only 902 players.

Halflings in Horizon Worlds were once criticized

Players are "more scarce than rare animals" which is a true reflection of the current metaverse space.

Facing the dilemma, Microsoft announced in January 2023 that it would close the 3D social virtual space AltspaceVR to cut costs; in addition, Microsoft also withdrew from several other VR plans and laid off 10,000 employees ; employees. AltspaceVR will officially retire on March 10, 2023.

The metaverse space of domestic manufacturers has also been almost completely wiped out.

Baidu Xirang is still a boring product that can only be hung around. Recently, Xirang has created a lightweight mini-program entrance. You can quickly enter the Metaverse venue from the mini-program in WeChat mini-program or Baidu APP without downloading the APP. It also supports one-click sharing. But no matter what the update looks like, the ultimate problem is that this product known as the metaverse space cannot provide a sense of immersion, and can only stare at the screen of the mobile phone and "run the picture".

Not only Xirang, Maotai’s Xunfeng, Jay Chou’s Music Space, etc. have neither the playability of games nor the immersion of the metaverse. Almost all the virtual spaces in mobile phones or computer screens will become "empty cities" after a short period of heat.

Why is it also necessary to support Horizon Worlds and AltspaceVR that connect to headsets? Some netizens hit the nail on the head: "Without a headset, you can't experience anything, but with a headset, you might as well not experience it." 

The software and hardware of the Metaverse are completely out of touch.

03 Hardware update is imminent

When the concept became popular, funds poured in and various companies competed for food. However, when a large number of virtual spaces, virtual games, etc. After the experience was created, people discovered that the "door key" to enter this virtual world was far from keeping up with people's imagination of the metaverse.

VR headsets are bulky and good content is scarce; AR can be made thin and light, but its role for ordinary users is limited to watching movies and playing games on a virtual big screen. Not only are AR/VR devices unable to achieve the high degree of fidelity and interconnection described in the Metaverse vision, but the price of several thousand dollars really makes people worry about getting "dusted" after buying them.

Matthew Ball, the "Father of Metaverse Business", once pointed out that the premise of the Metaverse is interconnection, that is, the exchange of data between different autonomous systems. Although XR technology has made significant progress, There are still many technical bottlenecks that have yet to be overcome in order to achieve a highly realistic virtual experience.

From the hard work in 2021 to now, the companies planning the Metaverse have also discovered that if they want to embark on this path, they must overcome the hardware hurdle.

So, a watershed occurred. On this long and costly road, some companies have chosen to shrink strategically and focus on self-protection, such as Pico. But some companies have stepped forward and tried to subvert the market, such as Apple's Vision Pro.

For Vision Pro, Apple CEO Cook described it as a space computer, which is the biggest difference from virtual reality devices such as Quest3 and Pico. The disruptive experience it brings by using cameras and sensors is to place familiar IOS applications in the real-time environment around the user, and the operation does not require any handles and can be performed only through eye movements and gestures.

Apple applications can be suspended in the space with Vision Pro

For example, various icons seen on Apple phones or computers can be suspended in the space after wearing Vision Pro, and can be displayed through eyes and gestures. operating applications; a giant virtual movie screen will also appear in front of you; Disneyland will be moved directly to you, and Mickey Mouse Station can chat with you on the sofa... It integrates almost all basic functions in life for games, work, and leisure, realizing It makes it possible to work and entertain in virtual space.

It can be said that Vision Pro is a head-mounted display product that completely breaks the boundary between virtuality and reality. According to the plan, it will be sold in North America this month and is expected to enter the Chinese market by the end of the year or early next year. The second generation is already under development.

This Apple product may redefine the standards of Metaverse hardware. Meta and Samsung may also iterate new products under the pressure of the strongest king. CICC Research predicts that the experience feedback of Vision Pro may exceed market expectations, promoting the development of component innovations such as silicon-based OLED, IPD interpupillary distance adjustment and other technologies, thereby promoting a return to growth in VR shipments.

Although the Metaverse will be cold in 2024, hardware updates will bring it a glimmer of light.