Panel of Protiviti insurance experts discuss the future of asset protection in the metaverse

Joe Kornik: Welcome to the VISION by Protiviti podcast. I'm Joe Kornik, Editor-in-Chief of VISION by Protiviti, our global content resource examining big themes that will impact the C-Suite and executive boardrooms worldwide. Today, we're exploring insurance in a metaverse future, and we've got great guests to help us do that.

As we're joined by Protiviti insurance experts and managing directors, Sean Seasongood and Tom Luick, as well as director Jackie Simmons. And I'm happy to turn over the interviewing duties today to another Protiviti colleague, Alex Weishaupl, a managing director in Protiviti's Digital practice, to lead this important discussion. Alex, over to you to.

Alex Weishaupl: Thanks, Joe. When we talk about the metaverse at Protiviti, we're talking about both the customer-facing technologies that enable user experiences; those virtual reality or mixed reality technologies that users engage with via screens or advanced headsets, and how they serve as interfaces to a host of enabling tech made-up of everything from decentralized systems like blockchain to more traditional systems and data stores. The key to all of this is interoperability, that these systems come together to power compelling experiences for their consumers.

Excited to be here today with Tom, Jackie and Shawn so we can talk about the metaverse and how this group of technologies and ways of engaging users are poised to affect the insurance industry. Let's get started.

My first question for the group is what are some of the key issues you see in the current insurance customer experience and how might the metaverse help to address any of those issues or those gaps?

Shawn Seasongood: Thanks Alex, I'll take that first. So I think insurance companies have really been looking at, you know, two different models. There's been the legacy model, which is more of an agent sales experience, and there's also the direct model. I do think that, you know, there's a lot of benefits from the legacy agent sales experience. But if you look at the way that companies are marketing themselves, there's much more consumers that want to go direct. And I think the metaverse could offer an experience that maintains that personal face-to-face interaction in the digital model, so thinking about in the future when you're able to introduce more visually engaging ways to help buyers understand product features and tradeoffs. This could be a great way where companies could really start to enhance their direct channels and their efforts around direct selling.

Me personally, I've experienced this recently, I purchased a golf cart in December. My first thought was to go to my traditional agent that does my homeowners and car and see if I could add a golf cart policy. Well, my particular agent didn't have that policy and asked me that, you know, I could buy it directly online, so I did my fair share of research. I thought I was pretty astute when it came to this topic, and even, you know, looking at some of the direct options I had, I was a little bit unsure as far as what kind of coverage I needed. Do I need collision plus liability? I'm in a flood zone so I need to have a flood insurance as well…

So, at the end of the day, I actually didn't buy the policy direct and I went to another agent that actually offered golf cart insurance and it was a pretty good experience. Spent 15 minutes with the agent. I was able to secure the right type of insurance, but I walked away knowing that, you know, I mean, spending 15 minutes with the person, you know, the total premium was probably around $300. And it was, you know, something that I thought that if that direct model had that enhanced feel and that experience that you might be able to get through a meta solution I think that you could see where, you know, companies are going to be spending a lot more time enhancing their capabilities in this space, again, to achieve that agent sales experience using sort of a meta sort of enhancement.<>So I kind of felt it first hand as far as what the current experience is versus what that experience might look like in the next 5 to 10 years.

Jackie Simmons: I think another component there, you know customer experience is critical for all companies, and insurance companies are not different. But there is a cost impact that is higher to some  organizations from a customer experience. There are a lot of costs associated with agency models and the ability to leverage alternative models of delivery can help from the cost side as well as enhance the customer experience. So bringing both of those together.<>Another example would be potentially in an employee benefits type of scenario, right? Typically you're sending a lot of folks on site to an organization to help train and understand all the types of benefits that are available to them. The use of metaverse technologies could actually streamline that and bring down the costs associated with it in order to deliver even advanced solutions as well as potentially increase the amount of sales that are happening within the employee benefit space just by giving them a different way of learning and engaging.

Weishaupl: That’s great. And it sounds like there are some real substantive areas where the metaverse might be able to improve, for lack of a better term, that sales and onboarding process within the insurance industry. I'd love to talk a little bit about other areas that could be impacted as well. And I think, for example, an area like claims processing which has historically been an area of friction for both policyholders and the insurance provider alike. What kind of changes could we expect in that process in a metaverse-enabled future?

Tom Luick: Thanks, Alex, This is Tom. I'll jump in here and go first. How a claim is processed, from the timeliness and quality of communication to how long the it takes to complete the claim and, you know, for example in the auto space have your automobile fixed, to the ultimate payout is really critical to the customers experience with the carrier. And if the claim is not handled to the customer's satisfaction, there's a good chance that the customer may leave.

So when I think about the impact of the metaverse in the claims process, I think about things like how could digital twins accelerate the process end to end and make the process more intimate and more aligned with the customer's preferences and expectation. So for example, if a customer had a digital twin that digital twin could have preferences on how that customer wants to be communicated to, what's the style of communication, how frequently they want to be communicated to and what's the platform. And I think that's critical throughout the claims process.

So if you are, you know, again sticking with the auto accident, if you're in an auto accident, I think one of the most important things that your insurer can do is communicate to you effectively in a way that you want to be communicated to. Or the automobiles themselves could have digital twins that could use, you know, IoT sensor data and other information, telematics data, etcetera, to better predict the damage that was done to the vehicles and avoid surprises in the repair shop process.

And then finally you think about, what about the repair shop? So if repair shops were to have digital twins, maybe that would help predict the best place for specific repairs to go. And that could be based on the workload at the repair shop, their experience, how customer review data aligns with the specific insured’s preferences and other factors. So I think there's a really significant opportunity for insurance carriers to leverage the metaverse in the claims space. And while we're probably not there yet—you'd have to build out all of these digital twins and so forth—I really think this is a fascinating opportunity for the industry to really improve the customer experience where it truly does matter most.

Simmons: You know, Tom, that is an excellent point on having a digital twin of a car. I would say this also is a potential to open up for new products because as the parent of a recent 16-year old, I would certainly pay more to have access to digital twin of my son's driving in the car and you know, maybe in the way it's utilized, right? Thankfully, they didn't have this technology when I was a kid, I probably would have gotten my car taken away a few times. But you know, as a parent, you know, safety of our of our family is critical, and I think you know, this does open up opportunity for products that we haven't even thought about.

Weishaupl: I think that's really exciting, that idea of kind of taking all of that insurance data and processes and decisions out of that black box so that more folks can see it, whether, Tom, as you were alluding to the customers or the partners, Jackie with employees and others, that notion that rather than having all of this information sitting in one place versus another, that that ability to combine them together and visualize that so that all of the different players are looking at the same information from the same perspective, is a really exciting way of opening up transparency and confidence in in the overall process.

I'd love to shift a little bit now to the employee experience. We know that there's a big turnover currently in talent across the insurance industry that we're going through right now, a bit of almost a generational changing of the guard. What do you see as some of the key causes for that turnover and are there any places where the metaverse could help?

Simmons: Yeah, I you know, this is an interesting thing and I think maybe I'm an interesting person to answer this question because I started my career as an actuary and that was probably five years and I was quickly out, right. We are probably not seeing as many individuals going into the actuarial space as we had historically. I think we're not seeing as many young grads wanting to move into the insurance space, not just in actuarial science, but also, you know, not even in claims, and even agents, right? We're not seeing the attachment to being an insurance agent, having the stature that it did probably 20 to 30 years ago. So I think that utilizing emerging technologies such as the metaverse can start to entice young professionals into the insurance space.

Luick: I agree, Jackie, I think. Omnichannel e-commerce is already happening for a lot of people, right? And the demographic that's involved in that is growing quickly and so is its economic power, right, as they become more lucrative in their careers and so forth. I think now is the time for insurance companies to start testing and learning in the metaverse. And that can be a huge attraction for young talent for these organizations, which, rightly or wrongly, are often perceived as not being very innovative. So I think there's a real opportunity to use this as a mechanism to start attracting talent, to show that a lot of these insurance companies are actually innovating, and innovating at a high pace in an area that's I think going to be extremely important to their futures. So there is an opportunity here to leverage the metaverse, to attract and retain the type of talent that insurance carriers and others in the industry, brokers and so forth, are looking for.

Seasongood: Yeah, and there's been no doubt that, you know, this has been a huge issue. Talent in the industry, probably for the last 10 to 15 years just based on the points that both Jackie and Tom are alluding to. It was a big problem before the pandemic, it became an increasingly bigger problem after the pandemic with the great resignation so how do we attract that next generation of insurance leadership has been something that the industry has been struggling with.<>So I do think, you know, as Tom and Jackie alluded to, the product development. If you have the opportunity to kind of look at these new interesting risks in the form of digital assets that might attract some people who traditionally might not have found insurance that interesting or who went to the different banks or different financial services companies. It might be a way of kind of getting that talent back into the insurance space. And I think a lot of has been talked about training. We talked about training the last time around claims. Within the metaverse, there is an opportunity to digitally show employees what to look for in an aftermath of a building or a big cat event.

You know you can't, and sure doesn't simulate huge events like fires and tornadoes in real time, or the real world. Just too costly, too expensive. And we talked about, if there's a big cat, the first time people are looking at these claim files or these claim events or the damage, you want them to be well trained as far as what to do. A lot of times, you know, the new newer generations, they want to work remotely so they've already kind of deployed things like drones, where they're able to take pictures. Based on different property damage and then based on that imagery you're able to kind of show people how to adjudicate these claims and to the point that we talked about before that might result in a more effective, more efficient claim adjudication process and that the underlying result will be a happier customer or policyholder that would be more likely to become a return customer.<>So I do think the metaverse is very, very important as far as attracting that next wave of talent, it is a big issue that the industry has been struggling for the last 15 years and I think it could be one of the solutions when it comes to both training and also attracting that next talent of insurance leadership.

Weishaupl: One question I have for you building on that, really excited about this theme of using these innovations as a way of creating more of a halo effect for the insurance industry to attract that new talent. I guess one of the other things I'm curious about within that space of the employee experience, does the insurance space struggle with consistency around things like claims and other things? Could we see this to the point that you started to allude to, Shawn, around experiential learning. Could that have an effect too on kind of normalizing or making more consistent processes, or is that already fairly well taking care of with within the insurance space?

Seasongood: Yeah, I definitely think around risk acceptance and underwriting practices, sometimes there is some subjectivity to that. I think you know the data that you can power from the meta could actually help to   that consistency. I look at other things like the sales cycle, you know, obviously those are the other areas where the meta could collect data and harvest that data in a way that is very powerful asset for the insurance company of the future. Most startup insurance companies are focusing first on data and data management and data science as sort of their starting point.

As far as what is that, you know, insurance company of the future specifically. It's not just within the PNC space I think life insurance companies have the same type of focus, so I definitely feel like that's an area to drive more consistency, to your point, to drive better outcomes for the insurance industry as whole.

Luick: I think that's a good point, and it would probably add just that not only is consistency important from an operational excellence perspective and a customer experience perspective, but there's also an opportunity here to manage compliance risk through the consistent execution of underwriting decisions, claims, process handling, et cetera.

Simmons: I think one of the challenges insurance companies have too is the ability to deploy talent across different lines and solutions. Sean, to your point on training, leveraging some of these technologies, it can do a few things. Younger generations really want to have a breadth of experiences. Gone are the days where somebody wants to come in and retire from the job that they entered, right? We all want to have those different experiences. So leveraging the metaverse for training can quickly get new grads, mid-careers, late careers up to speed more quickly, either in other products or other processes. That'll give the company a a few benefits, right? One is, the cost of talent has significantly increased. If you can leverage the talent that you have to do different types of roles as well as cover cyclical types of business, right. So when you have a downtime in one business but an increase in another, you can leverage your same staff across those different processes or products. It also gives you the ability to rapidly grow talent into leadership roles within the organization, which we all are desperately looking for. So I think leveraging the metaverse within the talent space could be the biggest benefit to an organization.

Weishaupl: That’s great. So far we've talked broadly about the customer experience and the employee experience. I'd love to get a little bit more specific or nuanced and hear a little bit about how you see this technology affecting how insurance companies might enable their different strategies from, ones that are more cost-focused to product-focused or relationship-focused. How can we see the the metaverse unlocking different strategies for those different types of insurance companies?

Simmons: Yeah, I think this is a really great point for everyone to stop and reflect in this podcast. Where is your organization and where do they lean in? If your organization goes to market mostly on a cost basis, how do you leverage the metaverse to increase value while reducing costs? If you are a product-forward organization, what are ways that you leverage the metaverse to create new products, to have differentiating products that your competitors cannot and will not be able to keep up with you? And thirdly, if you are a relationship strategy organization, how do you make meaningful deep relationships through the metaverse, which sounds challenging for sure, but how do you create those deep relationships that are meaningful to someone without maybe sitting across the desk face-to-face, and create longevity with those clients and stickiness, if you will, on their returning business and future business.

Luick: Yeah, I agree. I think there are use cases across the value chain for the industry to take advantage of with the metaverse, and I really agree with Jackie's point in that it's not one-size-fits-all, you really need to think about what is it that our organization, to use Jackie's words, is going to lead into and prioritize those areas. So for example, if you're an organization that leverages an agent experience pretty heavily, is there an opportunity in the sales cycle to leverage the metaverse? Maybe a customer will do some on some online research and have questions that come up or have things that need to be resolved, they don't understand, etcetera. Maybe there's an opportunity to have the metaverse as an interim step before that goes directly to the agent model or to an agent where obviously the cost of that sales cycle now goes up because there's human involvement.

So I think that there are opportunities throughout the cycle, but organizations are going to need to think about, where does this fit with our strategy? Where does this fit with the demographics of our customers and how do we make it work for those who want to leverage the metaverse and have a more omni-channel experience with us, but also leave the door open for those who are going to buy or expect their claims to be processed or their policy to be managed through more traditional means.

Seasongood: I agree with, and this is Shawn, I'll just add to what Jackie and Tom said, and I think they summed it up really well, but the one thing I also look at is, to Jackie’s  points, not a one size fits all but also the flexibility because it might change, the way you use meta to do home or personal lines might be different than the way you use meta to do commercial, might be different the way you do it for life and annuity. There's a lot of flexibility around this and I could see the industry taking some time to really adopt to it.

But I do think,  when you look at product disbursement and also geo, there's going to be different strategies too, a lot of insurance companies now think globally and they sell products across the globe, so what might work in North America might not be exactly what works in Europe, so there's got to be different ways of looking at it, flexible, and there's going to be some trial and error. It's going to be something like any natural evolution where it's going to take some time to get it right.

But I think the companies that invest in it early probably have a better path to being successful because I do think there will be significant trial in our era until this is really streamlined and fit for purpose for all different organizations.

Weishaupl: Shawn, you touched on a great point about how this is likely going to affect different types of insurance differently. I wonder if you guys might talk a little bit about how does that potential for change or the speed of change potentially differ for different types of insurance?

Seasongood: Well, I think, there's ways of looking at it differently. When it comes to metaverse, everybody's going to be operating in the metaverse, not just insurance companies. It's going to be a way that we function and operate going forward as a you know as a, as a civilization. There's now new assets that need to be protected associated with the metaverse. There's going to be virtual property insurance in the metaverse where individuals can buy and own virtual land, buildings and other assets, they'll have to be insured just like the real world. There’ll be virtual goods in the members, individuals can purchase goods such as clothing, accessories, digital currencies. They will also have to have insurance products associated with that. Virtual events, whether they're concerts or sporting events, again, that's another event that is costly to organize and therefore you'll have to protect against it in case it gets cancelled or any other unforeseen circumstances.

And also obviously, cyber liability insurance. As more people spend time in the metaverse, there's an increased risk of cyberattacks, just like the world we live in today with the Internet, and then obviously identity theft insurance. With the increase of virtual interactions, there is risk that somebody's identity, theft and fraud associated with somebody's, you know, metaverse identity. So all these different risks that are going to become much more important. And again, anything that has value against it, and these things are predicted to have significant value against, will have to have different insurance products that will have to be developed to protect that value going forward.

I look at that from a P&C lens. I don't know if others within the call they might be able to speak how they also see it, but I think from a product development standpoint, it's going to be pretty dynamic because you know the metaverse in itself is dynamic, so there's going to have to be some creative nuances developed within the marketplace to really protect those assets going forward.<>Simmons: Shawn, to your point earlier, if you don't know where to get golf cart insurance, I certainly don't know where to go if I want to protect the digital version of myself, right? Is it a traditional life insurance company or does PNC carry digital life, if you will? I think that will become a challenge. Is that something that's even insurable?

And then the reality is, there are a lot of fraudulent claims, to go back to a little bit to our point on the claims side. How do we even know what a fraudulent claim looks like against products that are really new to the market and we don't have a lot of data on from a claims perspective, I think it has a lot of impact into all insurance companies. I think life is maybe a little different and employee benefits might be a little different from a product perspective.

Seasongood: I think Jackie brings up a good point too about, we don't have 30 years of data associated with these new products. Traditionally insurance models, you take a lot of data through history and you're able to price and sell the products pretty successfully knowing what the future cost of claims will be. It's going to be a little bit sticky as far as the first couple of years, as you know, with these different pricing discussions around these digital assets because we don't have the data to really kind of….traditionally, we have a lots and lots of data before we make pricing decisions. So the pricing decisions around these will definitely be interesting to see how they evolve.

Luick: I agree, Shawn. I think there's a learning curve similar to what we saw with the cyber insurance market where over time things certainly tightened in that market significantly, as did the requirements placed on organizations to get a cyber policy in the first place. So I think we will see similar learning curves here because the data is just not there to support the models yet and people are going to probably in some cases find out that they were assuming more risk than they thought based on how they priced things, and they'll have to adjust.

Weishaupl: It's really fascinating thinking about this idea of the speed of technology change that we're living through, with an example of wanting data that goes back to maybe to 1993, that's a bit of kind of a funny discontinuity to think through, of how you balance that rate of change and the inherent conservativism that's needed to have that data to be able to build good predictive models that go into insurance.

So knowing that's certainly one key constraint, I'd love to know from the team here what are some of the other constraints you've observed that will likely slow the adoption of experience innovations like the metaverse.

Seasongood: Technical debt is a substantial issue for many in the industry and there's going to be a very significant investment required to capitalize on the opportunity of the metaverse and a lot of the other emerging technologies that are out there. So I think that is at baseline issue for many in the in the industry.

I think that there's some things in the metaverse that are also going to be challenging, so, for example, I don't think it's as easy in the insurance industry to define your strategy for the metaverse and your goals as it may be in, say, for example, consumer products, because the products and insurance are different, different demographics or buying insurance, etc.<>Secondly, I think it's really going to be interesting to see how many of these organizations, especially carriers, balance the metaverse with the agent experience and other sales channels.I think that's going to be very important. As we mentioned earlier, this probably isn't one-size-fits-all based on the products that you're selling and who's buying your products. So I think most carriers are going to have to really get comfortable that they understand their customer base well enough to make these types of decisions.

And then I think another key challenge would be what's the right platform in the metaverse for insurance carriers and brokers and others. And I think you know right now there's organizations in other industries that are having success with gaming platforms. Is that really going to resonate with individuals who are buying insurance versus, say, buying clothing or other consumer products? I'm not sure. So really thinking through what's a platform that's going to resonate with our constituents and our customers and our potential customers is something that's not going to be easy for a lot of organizations in this industry to figure out.

Simmons: I think it's important to remember that there are good and valid reasons why some organizations may not participate in the metaverse, or at least not immediately. There are, for example, in life insurance, a lot of life insurance organizations run 100-year liabilities and sometimes they run those on systems that are 40-50-60 years old and those products just may not make sense to implement. It's really important for an organization to step back, understand who they are, who they are in the marketplace and who they are as an organization and say, where does implementing the metaverse make sense?

If it's going to only get one kind of plug, maybe it's the employee experience, maybe the customer experience is most important. It isn't something where organizations need to run full speed into all the different facets that they could implement the metaverse because they may get so disparate in their efforts that nothing is leveraged to its full capacity and turned into a competitive advantage.<>And that's what this is really about. How do we leverage something in the metaverse as a competitive advantage for our organization. There just might be reasons why it's not the best place for all organizations to start right away.

Seasongood: I guess I'll just add that this is really early days about the metaverse. The continuing expansion is going to happen, it's inevitable. It's going to continue to be significant shifts in the way that businesses and insurance companies use the metaverse and its technology advancement. I do think it's early days. Is this a similar situation like when social media first became, you know, came on ground, we might not yet foresee all the ethical, reputational or legal risk associated with the metaverse. I immediately think of regulations and respect for social norms will be imperative, and insurers will have to ensure that people engage safely with all kinds of virtual experiences. The business of insurance is the business of risk management so again, with early days of this metaverse, it will be very interesting to see where it goes.

But I think a regulation is something that's going to be a challenge because it's going to be how these products are regulated, how the metaverse in itself is regulated. I think is a little bit early to be determined and I it will be interesting to stay close to that.

Close to 20 years ago when we first started getting social media and how people and regulation has changed over time associated with that. So I think as companies continue to wrap and develop innovations, they're going to continue to offer products to protect against those innovations, and I think the industry in itself has spent a lot of time in building that trust with policyholders and they've really worked hard to earn that trust of policyholders and consumers and it will be interesting as these things evolve that they continue to evolve in the way that they can continue to ensure that trust in a dynamic world such as the metaverse.

Weishaupl: That's really insightful as a way of looking at this domain. Tying it now to the last question. We've talked a little bit around what might come in the future, whether that's future regulations, some future risks that might may need to be insurable. I'd love to look a little bit further out, let's say 10 to 15 years. How do you see technologies like the metaverse more fundamentally, potentially changing insurance and what's insurable? How are you, and how is Protiviti looking at that notion of the future of asset protection?

Luick: It changes what's insurable in a few ways. One, there's going to be be new things, new risks that need to be insured as Shawn alluded to. I also believe that with some of this information, the way that claims are adjudicated and paid will also potentially change. For example, we talked earlier about having digital twins for automobiles in the claims process in case there was an auto accident. I wonder, and I believe at some point, the way that the IO T data comes together, other information that gets pulled into the metaverse potentially or is used in analytics around the accident, may have a big impact on how fault is determined for an accident.

So I think that as we continue to see these models evolve and these organizations learn from them, I do think that there's going to be emphasis put on, is there information that we're gleaning from the metaverse that determines whether we should pay a claim or not on existing insurance, things that we insure regularly today. So I think that there's really those two different angles. One, what are the new things that we're going to need to insure and what are the new risks that the metaverse and other emerging technologies create, and I think that's a that's a really interesting opportunity for the industry.

And then also, how do we leverage the metaverse to make sure that we are hopefully paying claims more fairly and more accurately and so forth, but it will also have an impact on decision making in the claims process on current insurance as well.

Seasongood: I think the industry is really evolving in itself beyond the metaverse. If you think about, 5-10 years from now, we'll have a lot less…we'll have, driverless cars. That's going to be a big change in the industry. There's going to be a lot of uncertainty as far as future weather patterns and climate. That's also a big change that's probably going to happen within the industry. I look at things like crypto and people actually operating and exchanging money through crypto currencies and exchanges. That's also a big change in industry. I think the industry in itself is evolving. It's really hard to predict what it's going to look like in the next 5 to 10 to 15 years because of all the underlying changes, but you throw metaverse in there, it's it's, it's another situation that's probably going to be, you know, I don't know if it will be a disruptor, but it'll be definitely something that will be helping the insurance company of the future really trying to manage these new and evolving risks, and it's going to be interesting to see, you know, how that all plays itself out.

I've been in insurance now 20 years. I cannot see the next 10 to 15 years in insurance looking anything like it did the last 10 to 20 years, so it definitely seems to be part of the overall evolution. As far more to come, maybe even two years’ time, we might have more clarity as far as how the metaverse will play… definitely we know it's going to play a big impact, I guess just to the to the extent and where it all fits within that evolution, I'm not sure.

Weishaupl: This was a great conversation today. Thanks, Shawn, Jackie, Tom. Now back to you, Joe.

Kornik: Thanks, Alex, and thank you for listening to the VISION by Protiviti podcast. Please be sure to rate and subscribe wherever you listen to podcasts and don't miss all the metaverse content we have at vision.protiviti.com. On behalf of Jackie, Tom, Shawn, and Alex. I'm Joe Kornik. We'll see you next time.                      

Lamina1 CEO says open metaverse, blockchain optimization key to unlock online future

Joe Kornik: Welcome to the VISION by Protiviti interview. I'm Joe Kornik, Editor-in-Chief of VISION by Protiviti, a global content resource examining big themes that will impact the C-suite and executive boardrooms worldwide. Today, we're exploring the metaverse future and I'm excited to be joined by emerging technology executive Rebecca Barkin, CEO of Lamina1, a layer-one blockchain optimized for the open metaverse.

Lamina1 was co-founded and is chaired by Neal Stephenson, a name you may recognize as the man who coined the term metaverse in his 1992 sci-fi novel Snow Crash. Rebecca brings over 20 years of experience, shaping creative strategy and immersive experiences to her role as CEO of LAMINA1, having previously worked at AR pioneer Magic Leap, where she drove the development of AR experience for Warner Brothers and HBO’s Game of Thrones. Rebecca, I'm so happy to have you join us today.

Rebecca Barkin: Oh, thanks so much for having me. It's great to be here.

Kornik: So, I mentioned there that you've spent much of your career as an augmented reality creative strategist and immersive tech expert. So, before we get into Lamina1 specifically, talk to me a little bit about this emerging space and why you're so excited about this new era of digital life that we're sort of embarking on.

Barkin: Yes, sure. I mean, first, I love stories. I love euphoria and the feeling of being transported to a place, whether it's music or an interesting new environment, I don’t know. It can make you see the world entirely differently. I've always loved that. For that reason, I started my career in the entertainment business, in the music business specifically, just as it was being upended by a handful of hackers. I think that made a huge impact on me. I thought it was reckless but at the same time, I was also really frustrated by the very small number of people in the Hollywood community that had the ability to make decisions, sort of had the power and the money to make decisions about which stories were told, who got to see them, how they were casted. I saw advancements in technology starting to really change that paradigm and make room for new people. I saw this kind of crack in the door and some light seeping in and I chased it.

I think my theory on that was, with immersive technology, Hollywood knew how to tell stories, I mean they’re brilliant storytellers, but they didn't know how to do it in a world where the director’s toolbox had been completely broken in favor of these more immersive, more interactive approaches to storytelling, which are more germane to theater and gaming. So, I saw this opportunity to get into it and to take the things that I love very, very much that I think drive humanity, which is the arts, to make us think about things differently and encourage envisioning and critical thinking, which really is what differentiates us from those who came before us. I said, “That's something I want to be a part of, and I have the sort of aptitude thankfully to sit between engineering and creativity.”

Kornik: Sure. I'm sure those days at Magic Leap, as I mentioned in your intro, were probably a little bit of a baptism by fire. I mean, the things that were happening there were probably incredibly ahead of the curve, right, in terms of the technology. <>Rebecca Barkin:  Yeah.<>Joe Kornik: So, Lamina1 now is a layer-one blockchain to empower creators to build the open metaverse. So, if you could explain what that is and why that's important and frankly, why business leaders should care about an open metaverse.

Barkin: Yes. I mean, we’re tackling the opportunity from two angles. First, the base layer, which is simply put this layer one, which provides a transparent ledger system. So, it provides for transactions and verification with security and speed but without really reliance on centralized control; that fear of a single point of failure. So, there's that transparency. There's traceability because that data is reported in multiple locations and people can see it at any time. So, I do think that at the layer one level, people should care because blockchain really can give businesses the confidence to be able to track things accurately, to release payments to their suppliers, to automate programmed aspects of any given agreement and its fulfillment. In our case, we want to apply that to entertainment, gaming and fashion. That's our focus. So that artists can get paid fairly. And so that, as we move into this world that is increasingly rich in 3D and spatial and really blends physical and digital in a really seamless way, that we're able to keep track of all that and it's with a level of transparency that we haven't really had before on the Web 2 era and help creators have prosperity there, and consumers have the privacy and agency to explore it. So, that's layer one, right?

Second, we're kind of at this inflection point where like, engineers make a thing, and they advance us but then there's always that sort of cycle of hype and then disappointment. Everyone in emerging tech has seen it. We saw it in AR as well. But once you get through that, there's this kind of quiet period where people reassemble themselves and they look at industries where it can really solve a real problem. They apply that vertical focus to bring new people into the system. Right now, I think in crypto, there's a lot of recycling of the same community over and over again. What we really need is more interesting content and newer people to see the advantages of it. As we continue to spend more time and more money in these digital spaces people are going to start asking questions around like, “Why don't I hold on to that value?” As a parent of two boys that are pouring my money into Fortnite and Roblox, you ask yourself like “Why don't I hang on to those digital assets?” That's money I've invested, and in the real world, people don't come to your house and confiscate your things. So, I think that we'll start to ask more and more questions about that.

I also think that there has been a lot more attention from a consumer perspective on what this kind of subsidized ad model that is driven by tech platforms has done to us, right, overtime. It's taken a little while, but when we look at the effect of TikTok and Meta, and some of these other companies that really thrive on that ad model and the algorithmic approach to serving up content, bite-sized content that sells, and add AI to that, and we don't even know which things are the real things. There's no authenticity, right, in that content anymore. I think consumers, we owe consumers the ability to take back some of the rights that we gave up in that period where we really wanted to just participate in this exciting new digital space.

So, I think, from a humanity perspective, it's really, really important, and the more that that message starts to resonate, the more that consumers will start to ask for privacy and ownership and agency around their identity and their assets as we move through the internet. I don't know about you, but it's just now started to really occur to my parents that their phones are listening. You know what I mean? That their devices are listening, and they're like, “I didn't even Google that and I got an ad for it.” I just think this is wrong. As a result, I think it resulted from this era in the 2010s in Silicon Valley, where all of these social apps were coming up, and none of them really had to have a business model. It was just prioritize user growth, prioritize user growth.

So, what happened was the only business model they had, because they gave everything away for free, was to monetize people. Now we're trying to reverse this and get people to pay for articles or get people to pay for music and they're like, “Wait, what?” So, we have to change this dynamic, and I think consumers are coming along, I think creators are coming along and asking for more. I think businesses are going to start to realize that if they can effectively integrate their physical and digital worlds and evolve them as a channel, as a holistic approach to channel that, like the community, being able to retain that community is the most important indicator of viability long term, when you look at lifetime value and things like that.

Kornik: Right. You’ve mentioned the creator economy a few times during this interview, and I'd like you to talk a little bit more about that, if you could. The entire ecosystem, right, the builders, developers, and artists creators. Tell me why the creator economy is so important to the future of the metaverse and is this the big game changer for Web 3 and the metaverse?

Barkin: In general, the creator economy, when you look at what happened in that late-stage evolution of Web 2 and social, you started to see all this UGC content. We talked about that door in the beginning, of this little opening in the door. People started to be able to tell their own stories and make their own content and get it out there in the world in a way that brands saw as really valuable, and then people obviously saw as really valuable and started to engage with. So, the more tools that there are to be able to recognize those artists, give them a platform, make it affordable and economic for them to build and release content, the more robust our worlds and our Web 3 economy can be. So, I think it's really important that we open up those channels and we allow people to cross streams and travel more readily. If I can hang on to value as a creator that then moves through the internet freely and can monetize my data and monetize my feed, see all my assets, I'm more incentivized to keep participating in the economy.

I think that that explosion that we saw at the start of Web 2, we can see it again with Web 3. Obviously, we want to change the world like everybody else does, but we really want to change the model entirely for creatives by building really that empowered and prosperous community and be a positive influence, I think, on the culture and the industry on a whole. I think it needs that. We believe in this world where we have this window, this narrow opportunity between, in this transition from Web 2 where we can really restore and right the wrongs, some of the things we sacrificed as an exchange for global access to information and entertainment. This is an opportunity to change things. We feel pretty strongly about that in the long term.

Kornik: Right, right. So, it sounds like you think we're sort of on the precipice or a tipping point of what's next. So, you've covered a little bit about some of the potential warnings or things that could go wrong, but I'll ask you, is there anything that specifically concerns you or your biggest fears or how does this go off the rails?

Barkin: Yes, yes. It's a really good question. I think my biggest concern is that we're battling the convenience and the domination that mega platforms have offered us. It is hard to battle. I mean, I was watching Ted Lasso the other night and we looked on our phones to see, our iPhones to see if it was available. Then, we turn on our Apple TV, and we use Apple Pay. We watch a show that was made by Apple and in the show, it's all Apple products. I think you can very quickly slip into this world where everybody just serves you everything and you don't question it. Particularly with the advancements on the AI side of things, that I worry about that laziness and the convenience that comes with just having things served to us all the time and not really questioning it or encouraging critical thinking. I think that if we can show and demonstrate that interoperability is viable, and that we can sacrifice a little bit of ownership and a little bit of data for new business models that emerge out of our ability to just travel freely and own our own data and monetize it the way we want to and own our assets and track, continue to reward artists for royalties on the secondary market. I think you'll start to see people thrive in a more, I don't know, long-term kind of way.

Kornik: Flip that last question on its head a little bit and tell me what could go right? Like what are all the great things that we could see. Go out a decade if you will, and tell me what this looks like if we do this right?

Barkin: Imagining these worlds that you can travel to freely, buy whatever device you want to participate in the moment but the idea that you could move fluidly through these worlds, in and out of branded experiences and the storied experiences and to meeting people from around the globe share their experiences in virtual worlds that are all somewhat connected, where you carry your own identity and your own assets in a way that protects you from being exploited online, but gives you the freedom to move about that world and discover it at your leisure and with confidence that you're protected and you have the sense you need to have. I think loosening that grip of, we wouldn't have to go to every website you go to, you have to give them all of your data and all your information, not being constantly bombarded by ads, but in this world where I get to choose my level of engagement with those brands, but it's really more about people and art and this in commerce force and the seamlessness by which we can travel through these experiences without feeling exploited or like we might lose them or lose that value at any point in time. I'm really bullish that there is an alternative to the ad model and that constant feed of insecurities and vices that we get when we praise an algorithm too much. So, I'm really hopeful that this vision of an interoperable, rich world 3D immersive, euphoric experiences with a bunch of different storytellers from every corner of the world will be accessible to everyone and the cost of participating in it will come down.

Kornik: So, I just have to ask, did Neal have any idea, do you think, in 1992 when he wrote the word “metaverse” that it would essentially, 30 years later be its own, essentially, industry or its own movement?

Barkin: I mean, probably not, or he might have done things a little differently. I think Neal is an avid consumer of history. So, it's funny. I had asked him about sci-fi books, like, “What other sci-fi books should I read?” He was like, “I don't really read too much sci-fi. I read history.” That's, I guess, how he predicts the future. So, I think he knew that these things were coming, and he's been a gamer his whole life. He's always been in engineering and fascinated by sustainability and whatnot. So, he's a researcher, and he looks into the stuff and he deep dives in it. So, I think he had an inclination that this would materialize in one way or another and saw that, as cost comes down and as people have a need to escape more and to find better economic conditions for themselves, that they would build these other worlds that they could escape to and have those things. He always says like, “I won't predict.” But I think he definitely saw it coming. Maybe not exactly in the way that it's gone down.

Kornik: Rebecca, thank you again for the time today. I really enjoyed our conversation.

Barkin: Yes, I did too. Thank you for having me.

Kornik: Thank you for watching the VISION by Protiviti interview for Rebecca Barkin. I’m Joe Kornik. We'll see you next time.

Humanity in the age of the metaverse, with CJ Casciotta, founder of Reculture

Joe Kornik: Welcome to the VISION by Protiviti interview where we look at how big topics will impact global business over the next decade and beyond. I’m Joe Kornik, Editor-in-Chief of VISION by Protiviti. Today, we’re talking about the Metaverse, or more specifically, how we can maintain our humanity amid all this technology, and what happens if we don’t. To do that, I’m joined by CJ Casciotta, founder and president of Reculture, an agency specializing in messaging strategy and media production, where he's advised presidential campaigns and worked with global brands, including MGM Studios, Delta Airlines, Sesame Street, and the United Nations Foundation. His next book, The Forgotten Art of Being Ordinary: A Human Manifesto in the Age of the Metaverse, will be released in the fall. CJ, thank you so much for joining me today. 

CJ Casciotta: Thanks for having me.

Kornik: CJ, I just mentioned the company that you founded, Reculture, in that intro. Can you tell us a little bit about that company and what its goals are and its visions?

Casciotta: Yes. We’re a messaging and production studio. Really, we’re in the reminding business. I think when you deal with words and pictures, we’re all talking about these advancements in automation with ChatGPT and DALL-E, and it’s an interesting time to be in the business of words and pictures but we like to say that we’re in the reminding business where, as people are learning to work alongside and work with these automated processes, I think it’s more important than ever for the workforce to be reminded of what it means to be a flesh-and-blood human being.

The best way that’s always been done throughout history is homemade stories made by humans. So, whether we’re helping a company craft their purpose in a way that’s genuine and authentic to the people they’re trying to serve, whether that’s internal or external or both or—we’re shaping that purpose and transforming it into a story via a visual or audio medium, like a podcast series or an animated production. We’re really in the business of reminding people why they get up in the morning, who they are in a season where I think you’re going to see—well, you’ve already started to see—this relationship between automated everything and AI everything and worker burnout and this realization that “Maybe I lack purpose and I don’t know what my purpose is” or hyperpolarization, all of these things that are threatening our society right now, I think one of the antidotes to that is storytelling that reminds us why we’re actually here on the planet, why we get up to go to work and do things that matter.

Kornik: Right. So interesting. I know that you’re working on a book or you finished a book that’s due out in the fall, right? Can you tell me a little bit about that book? I love the title, right, The Forgotten Art of Being Ordinary: A Human Manifesto in the Age of the Metaverse. I mean it totally speaks to me because we’ve been focused on writing about the metaverse now for several months and a lot of that focus is on the technology obviously—and some of it has focused on the humanity, but I think not enough. Can you unpack that a little bit for me and talk a little bit about the themes of the book and some of the highlights?

Casciotta: Yes. I’m a media guy, right? I’m somebody who’s done this kind of work for a good decade or so now but I’m not a social scientist. I’m not necessarily a researcher per se. So, I’m coming at the metaverse in this whole conversation from a media perspective. What I’ve noticed is—and I’m sure everybody’s really noticed—is that we’re in this weird stage where we’re doubling ourselves as people. It started with personal branding. You can have your real self and then your personal brand that you highlight and showcase. There’s a danger in the metaverse of not recognizing that there’s a difference between our ordinary selves and the versions that we blow up through a profile or an avatar.

It’s not to say that we should fear technology or we should fear the metaverse or—VR for instance, we’re working with a health tech firm doing a bunch of production stuff from them and storytelling from them and they’re really excited because they are developing these virtual reality technologies where doctors are able to practice in VR and save lives without actually having to work on a cadaver—not to be blunt and stuff—but when you cut up a—that’s amazing. It’s an amazing use of technology. But if that doctor were to turn around and think that “Well, I’m saving lives in the metaverse." To have that—to walk around with that notion that they are actually doing—that is the thing to be done versus taking that, applying that to real life, then obviously, that would be a big problem. I know that’s a funny obtuse example but that’s what kids are growing up thinking about right now. Kids have that confusion. It’s exactly what’s happening in games that kids are playing, like Roblox and Instagram and TikTok—and let’s not be fooled; Instagram and TikTok, they are games. This book really gives us some practical ways to ground ourselves and ground each other as it becomes harder and harder to separate fact from fiction, what’s real and what’s artificial.

Kornik: Yes. So interesting. You make some fascinating arguments in the book, one being that our collective future depends on the choices we make right now when it comes to all media, really, but essentially, Web3 and the metaverse and how that’s all going to play out, and how we communicate with each other through those mediums, right, through those new technologies. You suggest in the book that it's a crisis as serious as climate change but just not enough people are talking about it. Walk us through that a little bit if you could in terms of the burning platform that we have in front of us.

Casciotta: Well, yes. What’s really funny is, at least here in The States, it’s, whenever there’s a big commercial crisis, economic crisis of corporate magnitude, the same playbook comes out, right? The same thing happened with Big Tobacco. You see it with the concussion issue with the NFL and with tackle football. It’s like, “Let’s just wait until the data is conclusive.” That’s riddled with lots of issues in itself. When it comes to media technology… not everybody smokes, not everybody plays football, everybody lives in our current climate, and everybody uses media technology. This is the stuff that we utilize to literally communicate information and translate communication between entities, whether that’s individuals or entire governments to the masses. If we can’t get ahold of that reality—and I know regulation is a scary word in some circles, so I won’t say that, but if we’re not proactively giving this some forethought to put in some guardrails, some handholds, around the thing that we use to, again, to literally communicate every piece of information with each other, we should not be surprised when we have the issues that we’ve been retroactively dealing with, like the COVID crisis and the amount of misinformation/disinformation that has come out there when it comes to public health.

What I’m calling for is a little bit more forethought so that we’re not late to the game, whether we’re a business, whether we’re a government entity, and we’re not retroactively going, “Oh, my gosh. I wonder what happened. I wonder why this is such a big issue.” [Laughter] It’s a crisis and it needs to be thought of as one. There was actually a really brilliant paper that was done by a couple of folks. Really, it was a group of people across a ton of different disciplines that argued that media technology, social media, all of the stuff should be really elevated to the discipline of—to a crisis discipline, and I agree with that. I mentioned that in the book.

Kornik: Yes. Another one of the ideas that comes up in the book that I think is really interesting is this idea that you pointed out that in a metaverse future that we can flourish completely detached from our bodies essentially, right, our human form, and you think that’s pretty dangerous, that’s a dangerous mindset to get in, and I think that’s a pretty interesting concept. You say these shifts come at incredible psychological and societal costs. What are the answers? What can we do?

Casciotta: Well, I’d like to answer that question with a story. My family and I last year moved up to this little suburb outside of Columbus, Ohio called Westerville. I think, to many people, that looked like a very strange move. “What in the world is in Westerville, Ohio?” Well, for us it was really dear friends who felt like family, who were parenting their kids similarly to us in the way they saw social media and their use of media technology. For us it meant being near people that had similar values as we did, who knew us as our ordinary selves apart from any kind of personal brands we might be tempted to put out there. That to us was really, really important. What I found out, in the process of moving to Westerville, Ohio, is it actually used to be ground zero for the temperance movement. The whole headquarters was here. It was because they had a big printing factory and everything here and it was really interesting that this was like the place you wanted to go if you wanted to work for the temperance movement. The reality is that that movement eventually failed. It didn’t really work. It didn’t once they overregulated everything, and it’s like the data didn’t show that it stopped a lot of the issues it was trying to solve.

But then I did some more research in preparation for this book and I found out that just about an hour and a half away from us is the City of Akron, Ohio, and in the City of Akron, Ohio, something very interesting happened. You had two guys who were these struggling alcoholics who got together and decided that the very process of being in close proximity with each other actually helped their addiction, and they ended up starting Alcoholics Anonymous. My point in that story is that in this age, proximity matters.

Kornik: Well, you can certainly convince me that the pendulum has swung too far in one direction and that we needed a non-tech intervention, but I’m Gen X; I didn’t grow up with this technology all around me all the time. Isn’t there a real generational divide going on here? I mean, aren’t Gen Y and Gen Z wired differently, I mean almost literally?

Casciotta: They’re wired differently but what’s encouraging is that there’s a lot of data out there showing that Gen Z, and even Generation Alpha, are actually pushing back against a lot of the assumptions Big Tech has made over the past 20 years.

Kornik: Yes, and I’m curious, as those generations have entered the workforce or are entering the workforce and are starting to move up through the ranks and as they continue to become more senior leaders, what that impact, or what that could mean, for businesses, they start to begin to try to figure out how to balance technology and the humanity of running a company, the employees, the interaction between senior leaders and more junior level employees. What are the benefits of such a realization for business leaders as they start to look at the future through a different lens perhaps?

Casciotta: It’s a great question. I think it’s realizing that genuine human interaction, what I call ordinary human interaction, a break in the automation change, is in fact a competitive advantage. Customers don’t want to go through an automated phone process that gives them seven different prompts before they actually talk to a real person. In some ways, the antidote to just good enough is actually ordinary. To make that shift, it’s going to take a lot of education; obviously, education of the workforce, and then shareholders as well. I think realizing that human interaction ordinariness, that face-to-face, that flesh-to-flesh sort of conversation, is something that can actually give you a competitive edge, is the opportunity at stake.

The bigger question is are we, as employees, as human beings, in service to the technology or is the technology in service to us? Are we creating a future where we don’t really need people to work anymore? [Laughter] That’s fine, but then we need to drastically shift what society looks like from a governmental standpoint, from an economic standpoint, and we need to be asking those questions as business leaders now so that we’re not caught between…or with our tail between our legs in 10 to 15 years going, “Oh, my gosh. I didn’t see this happening. Now I have a revolution, a revolt, on our, on my hands.”

I think whatever outcome we decide on, a company decides on, whatever is best for their bottom line, that’s fine. Again, I’m not a Luddite, I’m not antitechnology, but I think we need to think a little bit more realistically, carefully, and take our time when it comes to recognizing both the intended and unintended consequences of innovating to the point of human beings not being necessary anymore to carry out some of the key functions they have been for over 100 years, if not more.  <>Joe Kornik: Right. Which leads me right to my final question, which is where does this all end up? I mean when we do look out, let’s say, 10 or 15 years, how optimistic are you about the future in a world of humans and technology?

Casciotta: I’m an optimistic guy. I am pretty optimistic. I think it’s going to be like AA. It’s going to take enough ordinary people on a mass scale saying, “I don’t want this anymore. I don’t like this anymore. I don’t like feeling this way.”

Kornik: CJ, thank you so much for a fascinating discussion today.

Casciotta: Yes. Thank you for having me. Appreciate it.

Kornik: Thank you for watching the VISION by Protiviti interview. On behalf of CJ Casciotta, I’m Joe Kornik, we’ll see you next time.