Global banking forecast? Plenty of cloud. Protiviti MDs on accelerating banking transformation
Global banking forecast? Plenty of cloud. Protiviti MDs on accelerating banking transformation
Global banking forecast? Plenty of cloud. Protiviti MDs on accelerating banking transformation
Protiviti Managing Directors David Kissane, Global Leader of Enterprise Cloud, and Alex Setchin with Enterprise Cloud in Australia, sat down with Joe Kornik, Editor-in-Chief of VISION by Protiviti, to discuss some of the trends and investment priorities they are seeing in the financial services industry, including insights from Gartner’s Future of Cloud Computing in 2027: From Technology to Business Innovation. Kissane and Setchin also share some of the ways Protiviti is helping business leaders strategically address banking transformation and digitalization with cloud technologies.
Kornik: What global trends are you seeing right now across the landscape of financial institutions?
Kissane: Globally, financial institutions are actively transforming and moving mission-critical workloads to cloud, and legacy technology spend is declining dramatically year over year, with a 47% decline expected in 2023, according to Gartner. These numbers don’t surprise me, and I can confirm we are seeing this across Australia, Asia-Pacific and the U.S. regions. IT leaders are actively migrating workloads off legacy infrastructure, while some also are in the process of modernizing mission-critical workloads on cloud-native platforms for improved resiliency, reliability and scalability.
Kornik: And what do you think is driving this change?
Kissane: We can see a broader trend of an accelerated pace of core banking and mission-critical application migration and transformation. Again, according to Gartner, by 2025 cloud deployment of core banking workloads is expected to account for 14% of the total IT spend. There are multiple contributing factors here. First, the long tail of legacy applications and data is continuing to accumulate and requires attention. Second, IT spending on data centres is decreasing dramatically year over year as financial institutions actively exit capital expenditure-heavy and self-managed data centre facilities and migrate workloads to the private and public cloud.
This, of course, has a positive impact on mission-critical application resiliency, availability and scalability and unlocks capacity for the business and IT teams to focus on strategic initiatives that drive value for the business. Currently, a majority of the migrated workloads are non-mission-critical, but I see mission-critical applications accelerating in the coming years. Furthermore, many of the financial institutions in advanced stages of cloud migration and are launching modernization initiatives to drive further cost efficiencies, simplification and digitalization of customer and back-office processes on cloud native-solutions and SaaS platforms.
Kornik: The complexity of the operating environment of financial institutions is arguably greater today, with ongoing regulatory changes both a complicating factor and a reflection of this growing complexity. How do you see these changes mitigated by cloud adoption and transformation by financial institutions globally?
Setchin: The regulatory landscape is top of mind for financial institutions, and it is shaped by several macro factors such as economic environment instability, rising customer expectations, digitalization of financial assets, ESG mandates, financial crime, operational resiliency and strategic agility. Globally, regulators and policymakers prescribe how financial institutions engage with cloud service providers through robust outsourcing arrangements, governance and operating models. There is some emphasis on having effective multi-cloud models and exit strategies for transitioning major infrastructure and cloud services between vendors.
47%↓
Legacy technology spend is declining dramatically year over year, with a 47% decline expected in 2023, according to Gartner.
Cloud concentration and lock-in and third-party IT risks are also some of the key regulatory callouts in terms of principles and guidelines. Operational and cloud resilience is another priority for financial institutions and underscores the need for resilience controls and response mechanisms to outages from external factors such as cyberattacks. Financial institutions need to engage continuously and proactively with their regulators and policymakers, to be at the forefront of emerging regulatory frameworks globally as they enable their business agility and risk mitigation with cloud platforms and services.
Kornik: Finally, how do you see financial institutions approaching cloud transformation and digitalization? Any advice for business leaders?
Setchin: Cloud should be a strategic enabler of business change and digitalization and can help increase the speed to market, resiliency and scalability for financial institutions. There are seven strategic pieces of advice I’d share when it comes to cloud transformation and adoption by financial institutions:
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Set a clear vision and strategy for the cloud transformation with a focus on business outcomes enabling business objectives. Communicate the cloud transformation vision to all business and technology stakeholders and link transformation drivers back to customer outcomes.
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Be clear on the process- and people-change impacts and how business and technology teams will effectively communicate all changes.
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Set the right governance structure for the transformation with business, technology and customer stakeholder representation.
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Transform the technology landscape with cloud technologies so it’s sustainable for the future. The underlying cloud platform, systems, integration and data need to be simplified to reap the benefits.
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Define a delivery model that leverages internal expertise and, if needed, external technology expertise to ensure transformation outcomes are achieved. Set realistic targets.
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Execute on the transformation plan and deliver to all process and people change objectives, ensuring proper transitioning, knowledge transfer and upskilling of business and technology teams at the end of the program.
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Track benefit realization every step of the way, being sure to quantify even incremental benefits.
David Kissane is a managing director and Protiviti’s global enterprise cloud solution lead. His primary focus is driving the growth and implementation of Protiviti's cloud services across the globe. David has over 22 years’ experience across a variety of industries and held senior IT transformation roles, including Partner at Deloitte Technology Consulting, Group Infrastructure and Operations Director at Westpac Group, Global CTO of Reckitt Benckiser, Global Director of Architecture and Services at Reckitt Benckiser, and APAC Director of Cloud Services at PwC.

Alex Setchin is a managing director with Enterprise Cloud for Protiviti Australia where he is responsible for taking Protiviti's cloud and technology services and products to market and growing the global cloud transformation capability. He is an accomplished and trusted technology professional with a strong track record in building enterprise cloud solutions, developing technology strategies and architectures, and leading large-scale transformation programs. His broad industry background spans superannuation, banking and insurance, utilities (energy, gas and water), media and telecommunications, supply chain industries and the public sector, where he has undertaken several senior leadership positions as a director and organizational change leader.

Cloud concentration and lock-in and third-party IT risks are some of the key regulatory callouts in terms of principles and guidelines.
Inside Virbela's open campus: One way we could work in a metaverse future
Inside Virbela's open campus: One way we could work in a metaverse future
Inside Virbela's open campus: One way we could work in a metaverse future
Protiviti Director Kathie Topel dons her avatar and goes into the metaverse with Sarah Segrest, VIP of Community for Virbela's open campus where she serves as community organizer and facilitator. Open campus, or OC, showcases the art of the possible for virtual worlds that support healthy, thriving, human-centric communities. The purpose of the community is centered around the future of work, the future of education and virtual community building. Follow along with Kathie and Sarah to learn more!
Sarah Segrest is VIP of Community for Virbela's Open Campus (OC) where she serves as community organizer and facilitator for the community in OC. OC showcases the art of the possible for virtual worlds that support healthy, thriving, human-centric communities. Segrest is a learning futurist and technology consultant who leads corporate strategies for future growth, technology and community-building. An advocate for bridging gaps in equity, inclusivity and diversity, especially in Education and STEAM fields, Segrest is Founder of Octosmos, a consulting & services company connecting the dots for education, technology and nonprofit organizations.

Kathie Topel is a director with Protiviti’s Business Performance Improvement practice and is a visionary leader with 20-plus years in business transformation, innovative strategy, organizational change management, process design and efficiency and technology solutions. She is known for advising and supporting organizations to fundamentally change the way they operate and dramatically improve their performance and results. Kathie is an expert at working with and developing cross-functional teams that can perform at exceptional levels.

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The digital currency revolution is upon us. Only the global economy is at stake
The digital currency revolution is upon us. Only the global economy is at stake
The digital currency revolution is upon us. Only the global economy is at stake
“Let me issue and control a nation's money and I care not who writes the laws.”
This apocryphal quote, often attributed to Mayer Amschel Rothschild, the founder of the legendary banking house, suffices to convey how important money is to the economy and life in general. Money has existed in the form of coinage for nearly three millennia. It’s important to distinguish from the outset two key characteristics of money: namely, who issues it, and what format it takes.
The issuer provides money with a certain degree of trust in it. Thus, money issued by a sovereign national government tends to be more trustworthy than money issued by a municipality, a company or a digital platform. Trust is boosted not just by financial credibility but also by effective protections against forgery and the double-spend problem. The format of money, by contrast, mainly affects the efficiency of using it. It is more expensive, for example, to mint and transport coinage than paper money.
Digital forms of money can vastly increase efficiency through greater speed and reductions in transaction costs. In addition, many people find that digital money not issued by the government but ruled by an algorithm may be more inclusive and less affected by political considerations.
The digital currency landscape
Contrary to the popular imagination, we’ve been using digital forms of money for several decades. “Commercial bank money” is created when a bank lends money, thereby increasing the money supply beyond the amount the central bank issues as “base money.” This type of money has existed in digitized form since the 1960s, when banks in the UK and later in the United States created interconnected systems to move money between accounts, thus enabling account holders to transfer money digitally, albeit with high fees, especially across national banks and national borders. Debit and credit cards added further functionality to digital payments. Nowadays, we are also holding non-bank digital money on payment apps like PayPal or CashApp, although the balances are not insured by the government.
Cryptocurrencies are the newest form of non-bank digital money, and there are thousands of them. They tend to be decentralized, peer-to-peer transactional tokens with the aspiration of becoming a widely-used means of payment and store of value, but without being backed by any real asset or by an issuing authority such as a government. Even the largest one, Bitcoin, has an annualized volatility approaching 100% (4 or 5% daily) making it a speculative cryptoasset rather than a medium of exchange or a store of value—very few merchants accept it as a form of payment.
Other cryptocurrencies were originally designed to serve a purpose, like ethereum, the second largest, or Ripple, which facilitate cross-currency transactions. They are called utility cryptocurrencies, and their value should be less volatile given that they exist for a specific reason. Stablecoins are a third type designed to address volatility by pegging its value to that of a fiat currency (for example, the dollar), a commodity or a financial instrument. The issuers, accordingly, maintain reserve assets as collateral. The fact that they promise stability by holding reserves has drawn the attention of regulators and legislators, who have called for periodic audits of reserve levels so that there is transparency as to whether they are adequate or not.
While regulation of cryptocurrencies may erode some of their allure in the eyes of users who distrust the government, it would help legitimize and stabilize them. All countries in the world save for a handful (China among them), have declared them legal, but only two have taken the bold step of making a cryptocurrency legal tender—El Salvador and the Central African Republic. Both countries rely heavily on remittances, and thus saw potential benefits in facilitating financial inclusion and lowering fees.
While regulation of cryptocurrencies may erode some of their allure in the eyes of users who distrust the government, it would help legitimize and stabilize them.
Will central banks enter the fray?
There is nothing preventing central banks (governments), from issuing a digital version of their own fiat currency, such as a central bank digital currency (CBDC). Unlike cryptocurrencies, a digital dollar, for instance, would be a liability of the central bank (the Fed), just as the physical version (coin or paper). It would accordingly be virtually risk-free for the owner, though not necessarily anonymous like bitcoin or physical cash unless it is implemented as a token with a crypto key instead of an account with an identifiable holder. The central banks of nearly one hundred countries are at the very least doing research on this possibility. Looming large in the background of these efforts is the fact that cash is losing relevance as a means of payment. Governments are eager to position themselves for the next stage of the digital revolution in financial services. The stakes are especially high in the case of global currencies, such as the dollar, the euro and pound sterling, which do not want to lose status or be threatened by other fiat currencies, such as the renminbi. Thus, the respective central banks have published position papers and started to conduct pilot implementation projects. To that end, the Federal Reserve of the United States issued a report earlier this year saying CBDCs could fundamentally change the structure of the U.S. financial system.
A CBDC could be implemented at the wholesale level alone: Financial institutions open accounts with the central bank to hold reserves and settle interbank transfers. This would not be, in practice, much different from the current system. A more radical step would be to implement the CBDC at the retail level with individuals and companies being allowed to hold and use it. Note that a retail CBDC would be as frictionlessly mobile as a cryptocurrency, but with much smaller risk and volatility, and it could be used in a store, online or in peer-to-peer transactions.
If supported by a well-fuctioning digital ledger, perhaps a blockchain operated by the central bank, it would dramatically lower transaction costs. The Bank for International Settlements has proposed an agreement to create “interoperating” CBDCs as a solution to extremely high international money transfer fees. Emerging economies are especially interested in this possibility because they tend not to be well served by correspondent banking arrangements. They are also attracted to the idea of fostering financial inclusion, given that between a third and half—and in some cases more—of their population may lack a bank account.
Potential pitfalls of digital currency
The most vexing issue concerning a potential CBDC is whether it would pay interest or not. Physical cash does not earn interest unless it is deposited in a bank account that pays interest and is thus transformed into digital commercial bank money. An interest-bearing CBDC would be a close or near-perfect substitute for commercial bank money, treasury bills, and money-market mutual funds. Thus, it would make it harder for commercial banks to attract deposits, reducing their ability to give credit, and potentially leading to complete disintermediation in correspondent banking networks.
This could result in a credit crunch and the need for central banks to provide the capital to lend, making them even more powerful than today. The Bank of England has proposed not to pay interest, while the European Central Bank favors it, though at varying rates depending on the circumstances. The Fed has left the door open to further discussion, noting the negative impact on financial stability. All three banks suggest limits on how much CBDC individual account holders may possess, and how much they can accumulate over a certain period of time.
Emerging economies are especially interested in this possibility because they tend not to be well served by correspondent banking arrangements. They are also attracted to the idea of fostering financial inclusion, given that between a third and half — and in some cases more — of their population may lack a bank account.
A system for fintech to thrive
The idea of a CBDC is proving attractive to entrepreneurs if central banks are open to a public/private platform model, whereby fintechs would be interface providers. Users would access the central ledger indirectly with a pass-through wallet on smartphones or smartcards. The Bank of England favors this approach, while the European Central Bank leans toward direct access. In a risk-free digital fiat currency system, fintechs would compete on the basis of price, product differentiation, and customer service. Another model is the deal announced by Samsung and the Bank of Korea in May 2023 to conduct research with a view to launching a digital won on Samsung’s Galaxy ecosystem.
CBDCs have both ostensible advantages over decentralized cryptocurrencies like bitcoin (for example, only as much risk and volatility as the conventional fiat currency) and drawbacks (privacy, disintermediation, and systemic risk concerns). It is hard to envision a future scenario in which the likes of bitcoin and ethereum remain the largest digital currencies, if the most important central banks in the world manage to set up a platform that exploits the advantages and minimizes the concerns. But that’s a big “if.”
As of summer 2023, there were three active CBDCs in the world, launched by the Bahamas, Nigeria, and the seven-country Eastern Caribbean Union. Constraints on the amount issued have minimized the systemic risks while providing some insights into the beneficial effects in terms of financial inclusion. For example, the Bahamian digital “Sand Dollar” was launched in 2021 on an extremely limited basis; it accounts for less than 1% of total money in circulation (the equivalent of less than half a million U.S. dollars). As of March 2023, the Nigerian Central Bank had issued about 10 billion digital nairas (enairas), approximately $22 million, a tiny amount compared to the size of Africa’s largest economy. China’s retail pilot of the digital yuan is restricted to less than 2% of all cash in circulation, and less than 1% of all cash plus bank deposits.
The future of digital money
The launching of further CBDCs will be contingent on how effectively systemic risks are addressed, and whether they offer lower costs and/or more value to the user than existing digital cash services like Paypal and CashApp or their equivalents in various countries around the world. Serious doubts also remain as to their scalability, which will in turn depend on the central bank’s degree of comfort in issuing large amounts of digital currency given the systemic risks at play. But beware of what countries intent on increasing their influence over global financial matters might do. China is planning to make a digital yuan accessible to its trading partners in the Belt and Road Initiative and beyond. In that case, the dollar, not commercial banks, would be distintermediated. Bypassing the U.S. dollar would require interoperability between the digital yuan and the CBDCs of China’s trading partners. That’s a big task, but the incentives are similarly huge because cross-border money transactions involve large amounts and are presently very cumbersome, costly and inefficient. Thus, it is far more likely than not that central banks will come up with a design that will make it worthwhile for them to issue a digital currency, and that governments will support the decision politically so as to remain relevant in the brave new world of digital money.
As of summer 2023, there were three active central bank digital currencies in the world, launched by the Bahamas, Nigeria, and the seven-country Eastern Caribbean Union.
Is Apple’s Vision Pro a gamechanger that will mainstream the metaverse? Tech experts weigh in
Is Apple’s Vision Pro a gamechanger that will mainstream the metaverse? Tech experts weigh in
Is Apple’s Vision Pro a gamechanger that will mainstream the metaverse? Tech experts weigh in
Apple’s announcement of its Vision Pro virtual reality headset on June 5, 2023 elicited some strong opinions across the board. Could it really replace the iPhone and mainstream the metaverse, as some have claimed? Or is it just another overpriced wearable for the wealthy?
Indeed, with a $3,500 price tag the Apple Vision Pro will not be for everyone, but if previous Apple product launches are any indication, brand diehards and techies will be lined up to purchase the it when it’s available next year.
Apple’s announcement of its Vision Pro virtual reality headset June 5 elicited some strong opinions across the board. Could it really replace the iPhone and mainstream the metaverse, as some have claimed? Or is it just another overpriced wearable for the wealthy?
Indeed, with a $3,500 price tag the Apple Vision Pro will not be for everyone, but if previous Apple product launches are any indication, brand diehards and techies will be lined up to purchase the it when it’s available next year.
Even though Apple didn’t specifically mention the metaverse in the Vision Pro roll out, the mainstreaming of the technologies that enable the metaverse—AR, VR, XR and spatial computing, among others—could go a long way to planting the seeds that will make the metaverse grow.
Although difficult to get your hands on—or head into—one, those fortunate enough to have tested the VR headset have given overwhelmingly positive reviews of its performance, even if some were less impressed with its wearability. But, perhaps most importantly, Apple’s announcement put VR, Web 3 and even the metaverse itself back into the spotlight after a prolonged AI-induced absence, which began with the launch of ChatGPT last November.
Despite loving the name, VISION by Protiviti wasn’t quite sure what the potential impact of the Vision Pro might be, so we asked some tech experts to weigh in.
‘The most advanced tech product ever created’
“These aren’t just glasses. This is the most advanced tech product ever created—it’s a supercomputer,” says Cathy Hackl, futurist, Chief Metaverse Officer of Journey and “Godmother of the metaverse.” “This device is a steppingstone toward a future AR device that Apple will continue to work on.” To that end, Apple reportedly is already hard at work on a less expensive, more mass-market-friendly model that is scheduled to drop in 2025.
Rebecca Barkin, CEO of Laminia1, a layer-one blockchain company co-founded by Neal Stephenson (the writer who coined the word “metaverse” in his 1992 sci-fi novel Snow Crash), says the arrival of the Apple Vision Pro is a milestone event for the broad business of immersive reality.
“Beyond the product itself, it validates a whole host of spatial technologies, critical infrastructure and content initiatives that have been in the works for years. When a market leader with a unified product portfolio, massive install base and arguably unmatched brand trust commits in this way, it matters,” Barkin says. “Technologists double down, markets react, investors start writing checks again, and acquisitions occur. It’s a signal of confidence that catalyzes another sprint of innovation.”
Apple’s cool, calculated approach and deep focus on designing for the masses is markedly different from competitors that focus on being fast and first, Barkin says. Ultimately, what really matters is “Apple’s ability to elegantly transition their customers to something new over the course of the next few years.”
Apple’s announcement put VR, Web 3 and even the metaverse itself back into the spotlight after a prolonged AI-induced absence, which began with the launch of ChatGPT last November.
Protiviti’s Scott Laliberte, Managing Director and Global Leader with the Emerging Technology Group, said the introduction of the Apple Vision Pro is a pivotal moment, especially since it appears Apple has made significant improvements to the technology to make it more user friendly.
“The key now will be if the developer community becomes engaged in developing new applications and capabilities that leverage the Apple Vision Pro, which will compel people to use it.” Something, he admits, that may be more difficult to do right now with all the interest around generative AI. “Hopefully, we will see the broader engagement, but I think it may be a little longer before we see significant advancement in this space,” Laliberte says.
'A moment that invites us all into the future'
Tech visionary Amna Usman Chaudhry, a financial economist and strategist for blockchain, metaverse and Web 3, says while mixed reality and augmented reality headsets have existed before, Apple “has a knack of presenting its products in a simplified and elegant manner, which captures the imagination and encourages broader adoption.”
Chaudhry says Apple’s Vision Pro reveal was important because it makes emerging technologies such as augmented reality and spatial computing more identifiable to the masses. “It’s a moment that invites us all into the future. Millions were shown a glimpse into the realm of possibilities that exist in an immersive world, where the digital and physical worlds merge to create something extraordinary.”
For Hackl, that merging of the digital and physical worlds will be transformational, especially for the fashion industry where she has her focus. “The scanning and volumetric applications of the device as well as the spatial video and images will take fashion to the next level,” she says. “Apple will not only try to make the device aesthetically pleasing, but it will begin to transform fashion and luxury, both from a content and design perspective. This is the moment for developers and brands to start developing for this device and for the Vision operating system.”
This is a luxury product and luxury accessory for the luxury consumer, Hackl says. “The wearable device of the future will have to be a technological marvel firmly rooted in style. Users will be making a fashion choice to use the device or not and what it signals to others.”
It signals something entirely different to Charles Drayton, the Digital Contact Center Platform Lead for Microsoft's Chief Product Office. “While every other tech company goes all in with generative AI, Apple decides to take the ‘Way Back Machine’ to 2016 and revive the wearable headset for yet another attempt to convince consumers they’re cool.”
Drayton, who points out his opinions are his own and do not represent those of Microsoft, wonders if Apple will be the first to succeed in the AR consumer space with a wearable. “Well, history is against them, but if anybody can penetrate the mass market with new technology, it’s Apple.”
“It’s a moment that invites us all into the future. Millions were shown a glimpse into the realm of possibilities that exist in an immersive world, where the digital and physical worlds merge to create something extraordinary.”
- Amna Usman Chaudhry
The metaverse in 2040? Buckle up for a bumpy ride, says Elon professor and Pew researcher
The metaverse in 2040? Buckle up for a bumpy ride, says Elon professor and Pew researcher
The metaverse in 2040? Buckle up for a bumpy ride, says Elon professor and Pew researcher
Janna Anderson, professor of communications and director of the Imagining the Internet Center at Elon University, is the lead author of the report The Metaverse in 2040, published in partnership with Pew Research. She is a senior contract researcher for Pew and co-leads the center’s 19-year series of reports outlining experts’ predictions for the most likely future of digital life. The full report, released in late summer 2022, is available for free on Elon’s Imagining the Internet site and at Pew Research. Anderson is a renowned tech futurist and metaverse expert, and author of the book Imagining the Internet: Personalities, Predictions, Perspectives. Anderson sat down with Joe Kornik, Editor-in-Chief of VISION by Protiviti, to discuss the findings of the 2040 report, journey into a Web 3 future and offer a sneak peak of a forthcoming report on digital impact by 2035, expected in the fall of 2023.
Kornik: It’s always wise to start with a level-setting question: How do you define the metaverse, and when do you expect it to make an impact?
Anderson: Of course, there are many definitions out there, depending upon one’s point of view. In our recent research report The Metaverse in 2040, we found the most commonly accepted definition is that the metaverse is “the realm of computer-generated, networked, extended reality (XR).” XR is an acronym that embraces all aspects of augmented reality, mixed reality and virtual reality—AR, MR and VR. The report is an analysis of more than 600 experts’ opinions. While some were quite enthusiastic about its future, many said the metaverse isn’t likely to become high-functioning nearly as soon as some tech entrepreneurs were predicting back in 2021 and early 2022.
Kornik: What were some of the key takeaways from the Metaverse in 2040 report?
Anderson: In the survey, we received feedback from 624 tech experts on whether a sophisticated, fully immersive metaverse will be a key part of the daily life of a significant portion of the global population by 2040. The vote was split quite evenly: About half said they believe, or at least hope, that a well-functioning and fully immersive metaverse will be an aspect of daily life for many people around the globe. From this group, these three themes emerged:
- Profit motives will drive huge investment in the rapid development of extended-reality spaces, access and tools, and the metaverse.
- The technology could be possible by 2040—that includes the software, hardware, user interfaces and network capability to create a broadly adopted, fully immersive metaverse.
- By 2040, the metaverse is likely to be developed enough to be a truly useful place in people’s daily lives in many new settings beside gaming and entertainment.
The other half disagreed, and a number of those went as far as to declare that the metaverse was, in a word, “overhyped.” From this group, these three themes emerged:
- The metaverse is neither available nor affordable. The necessary software, hardware, user-interface and network improvements and capacity will not be available or affordable by 2040.
- Most humans generally will continue to prefer real life rather than full-immersion VR; they’ll expect VR to remain a niche space for gamers, entertainment seekers, training and education.
- Fully immersive spaces could further magnify all of the problems arising out of digital life today. Further, people may avoid engaging in spaces that are operated in the service of surveillance capitalism and open to abuse.
Experts on both sides mostly agreed on two big ideas: First, AR and MR applications will be embraced more broadly than immersive VR advances in the next decade or two. Second, they argued that the next-generation networked-knowledge ecosystem must be built in ways that better serve the public good, unlike the current business-oriented and highly extractive iteration of the internet.
experts argued that the next-generation networked-knowledge ecosystem must be built in ways that better serve the public good, unlike the current business-oriented and highly extractive iteration of the internet.
Kornik: Do you think the metaverse’s ultimate impact will be revolutionary, or are those skeptics who call it overhyped correct?
Anderson: Based on my knowledge as a digital consultant, revolutionary impact could be possible, but only if things come together to make the metaverse a better place for human agency and human rights than the internet is right now. I don’t know when or if that might happen. The research-and-development breakthroughs and truly effective industry agreements and business-practice modifications that are necessary to make it an enhanced, human-centered and humane place might not all successfully emerge in the next 10 to 20 years. If that doesn’t happen, the metaverse may not become part of most people’s daily lives by 2040, except for those most involved in gaming, taking action in mirror and alternate worlds, or working from home.
That said, I believe that the metaverse could definitely be revolutionary in many positive ways if progress is made in at least three of four important areas that will greatly influence the outcome of humanity-plus-tech: artificial general intelligence (AGI), quantum computing, materials science and governance of digital tech.
- AGI: Some experts estimate that we could see the arrival of early forms of full artificial general intelligence (also known as human-level AI) within a decade, and Our World in Data reports that more than half of the experts responding to three recent surveys say there is a 50% chance that human-level AI will be achieved in the next decade or beyond.
- Quantum leaps: Some experts believe that quantum computing, which could supercharge machine learning, could take a few leaps forward soon.
- Advances in the materials that make up our tech: Potential materials science achievements may allow for breakthroughs such the further advancement of Moore’s law and achievement of trillion-transistor chips. This could accelerate things significantly across all tech by 2035–2040.
Breakthroughs in these three areas could revolutionize everything, including future communications networks and the metaverse.
But the final point—better governance—is possibly the most difficult and unlikely to achieve: There’s still a need for the world to confront the widespread social, political and economic problems arising from flaws in the design and uses of the current internet and web. Despite calling 2023 “The Year of AI,” many prominent voices are now focusing on the potential negatives of its rapid, unregulated and accelerating influence. It’s going to take widespread global engagement to address the challenges of evolving a safer, more trusted AI and the networks/systems it runs on, including the internet and the metaverse.
From the report:
“To be so successful by 2040, [the metaverse] must be many things to many people, enrich or make better their everyday lives. It must go beyond games and entertainment to provide what each and every person needs. The first, and the biggest, step will be to instantiate and regulate the metaverse as a public benefit/utility, so the greatest number of people can access and benefit from it."
- Jacquelyn Ford Morie, VR pioneer and chief scientist at All These Worlds
Kornik: The metaverse has had some pretty strong headwinds blowing the last 18 months or so. What happened?
Anderson: I think a reckoning has arrived with regard to metaverse expectations. Massive corporate losses on metaverse investments and a large-scale withdrawal of funding and personnel for metaverse-specific projects are making headlines now, along with more widespread calls for technology-platform companies to put people ahead of profit. Why did the hype balloon burst? I think there are a few reasons:
- People came to realize that it’s not currently technologically possible to make simultaneous, fully immersive, real-time experiences available to millions of users online on multiple VR immersion platforms. That was the promise Meta seemed to be selling in its Super Bowl ads in February 2022.
- Today’s user interfaces are also a problem: The headgear is clumsy, being in VR makes many people feel awkward and it still makes some people feel ill; the gear is expensive—thus, it’s not consumer-friendly enough yet, and making it so will take a lot more development.
- The case for massive capital investment to flow into metaverse development has pretty much vanished. This is a big one! If the public outcry demanding that corporate and government powers make Web 3 and the metaverse a better, safer, more equitable and more trusted place actually accomplishes such a change, those eyeing the metaverse as even more lucrative than the internet in its current surveillance-capitalism model worry that they may not be harvesting the billons in profits they had imagined. This has cooled the investment frenzy quite a bit.
All this has led to what some are calling the metaverse winter, as the tech industry and consumers alike have switched their focus to a slower and steadier XR evolution. In 2023, the focus is on the wearable AR/MR/VR headgear space—including an entry from Apple.
Experts overall expect AR and MR to gain much more usefulness and popularity in the next decade or two because a lot of the tech is becoming more compact and consumer-friendly. The public prefers using simple tech that affordably allows them to make their lives easier, more interesting and more fun while allowing them to keep at least one foot in real reality. AR and MR will evolve to become quite popular soon if that public expectation is achieved.
Kornik: I typically ask people to go out a decade and tell what’s next, but you’ve already been to 2040 and back, so I’m just going to ask if you can share whatever you’d like to about the metaverse future.
Anderson: Yes! At the Imagining the Internet Center at Elon University, we are always thinking very far into the future. As far as the metaverse and the future, I’ll pick up where I just was: I think it is generally expected that in the future, our movement between various XR opportunities and real life will feel fairly seamless. People, perhaps, will not feel as if they are “entering a metaverse” when they play a game, attend an Ivy League course or enjoy a virtual concert while fully immersed online. They may seamlessly shift their attention without a thought as they walk from room to room in a home, school or office while carrying on an in-person conversation, speaking on a video call, gaining an education or competing in a game in a full-immersion situation.
From the report:
“By 2035 people will laugh at images of the 2020s that show people walking down the street staring down at a phone, necks bent, thinking it looks awkward and primitive. The metaverse will evolve in two directions at once – the virtual metaverse (fully simulated worlds) and the augmented metaverse (layers of rich virtual content overlaid upon the real world with precise spatial registration). The virtual metaverse will increase in popularity but will always be restricted to short-duration applications – mostly for gaming, socializing, shopping and entertainment, and it will have powerful business and education uses as well. The augmented metaverse, on the other hand, will replace mobile phones as our primary gateway to digital content."
- Louis Rosenberg, CEO of Unanimous AI
Because of this, some tech experts are saying that the word metaverse will pass out of use fairly soon. They expect that all tools of digital life will be accessible in all connected spaces, fully immersive or not, and most members of society will live IRL—in real life—part of the time while also easily making use of AR, MR and VR as needed throughout the day, deciding how, why and when parts of their lives are best enhanced by those tools and accessing what they need.
We just completed some research that will be out later this year that looks at the potential future societal impact and implications of unstoppable digital change. We asked a group of experts: “What are the best and most beneficial changes, and which are the most harmful or menacing changes you expect in digital life by 2035?”
More than a third (37%) said they are more concerned than excited about the change they anticipate, and 42% said they are equally concerned and excited. Only 18% said they are more excited than concerned.
The upcoming report will carry literally thousands of predictive comments of digital life by 2035, including:
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Great expectations for positive overall impact of digital advances across all aspects of life, especially in research and knowledge-advancement collaborations in science, healthcare and education
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Excitement and worry about generative AI, spurred by the emergence of somewhat improved but still “hallucinating” AI like ChatGPT
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Fears that automation may cause millions of people to become unemployed
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Concerns over growth in digital crime, blanket surveillance and destroying the information atmosphere with deepfakes, misinformation and harassment — all enabled by the unstoppable speed and scope of digital tech
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Worries over the current flawed primary revenue model for online life due to its serious unintended negative societal consequences
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Anger about the overt concentration of global wealth and power in the hands of the founders and leaders of a few large corporations.
In a nutshell, the forthcoming report sums up both the positives and negatives of a digital future. While most agreed that humanity will have the opportunity to find wonderful ways to grow healthier, happier and more knowledgeable thanks to advances in digital tech and systems, they also expressed their deep concerns in regard to the potential of these tools and systems to degrade, diminish and even cause loss of human lives across the world—all while educating and entertaining billions and making a very small percentage of humanity extremely wealthy.
From the report:
"There is a real possibility that those who are ‘plugged in’ will become increasingly untethered from the world around them. Future waves of pandemic disease and the effects of climate change will allow those with means to spend more time in virtual worlds. Will we become more willing to let conditions worsen around us because we can escape to an alternate reality? Meanwhile, those on the other side of the digital divide will struggle to access resources, connections and opportunities."
- Toby Shulruff, senior technology safety specialist at the National Network to End Domestic Violence
Protiviti’s Kim Bozzella: Time to evolve beyond marketing to make meaningful metaverse moments
Protiviti’s Kim Bozzella: Time to evolve beyond marketing to make meaningful metaverse moments
Protiviti’s Kim Bozzella: Time to evolve beyond marketing to make meaningful metaverse moments
Protiviti Managing Director Kim Bozzella, Global Leader of Technology Consulting, sat down with Joe Kornik, Editor-in-Chief of VISION by Protiviti, to discuss some of the key findings of the recent Protiviti-Oxford research report, Executive Outlook on the Metaverse, 2033 and Beyond. Here, Bozzella offers her thoughts on the often spot-on, sometimes surprising, and always interesting insights from executives. She also shares some of the ways Protiviti is helping business leaders strategically sort out the metaverse future.
Kornik: Meanwhile, the numbers across the entire survey show enthusiasm levels among executives in North America outpace those in Europe and Asia-Pacific. Is that also your sense of the global landscape when it comes to metaverse adoption and enthusiasm?
Bozzella: Those numbers seem in line with other digital technology waves. Culturally, North American consumers and businesses seem the most willing to experiment and innovate to find an edge. Many of the metaverse companies, which are predominantly in gaming, infrastructure and architecture, are in the US. Additionally, significant U.S.-based venture capital and corporate venture capital are directed at U.S startups so the metaverse is probably top-of-mind for many U.S. executives. The successful North American “experiments” will rapidly make their way to Asia and Europe, where they’ll find their own innovations and creative ways to leverage and expand the technology.
Kornik: We also found customer experience and customer loyalty are top of mind for global business leaders, with 70% saying it would be “somewhat or extremely important” over the next decade. How do you see the metaverse impacting customer experience and customer loyalty?
Bozzella: The metaverse will allow companies to become more interactive and personal with their customers, providing a more meaningful experience to drive stronger relationships and loyalty. With that said, metaverse implementation must be done right, with the experience being thoughtfully executed and privacy and security considerations at the forefront. I think of it by way of analogy: Not every business needs to have a social media strategy, but businesses that have customers who use social media need to know how to be present, or they lose an opportunity to be relevant. That’s the direct customer experience—being meaningful in the channels where their customers are and expect them to be.
As consumer behaviors around the metaverse mature, businesses will have to adapt their customer experience strategies to account for those behaviors to maintain relevance and have a chance to earn loyalty. What I think is equally interesting is the indirect customer experience. I look at all the people and processes that are involved in maintaining a customer experience—the employee trainings, the customer service interactions, the logistics analyses—all of them are likely to be improved by the interactions and visualization the metaverse can support.
Culturally, North American consumers and businesses seem the most willing to experiment and innovate to find an edge. Many of the metaverse companies, which are predominantly in gaming, infrastructure and architecture, are in the US.
Kornik: I think we were a little surprised 43% of executives we surveyed globally said they already have a metaverse strategy in place. One in five say they’ll have one in place in one to two years, and one in three say it’ll be three to five years. Only 4% say it’ll take six to 10 years. Do those timelines align with discussions you and your team are having with executives around their metaverse strategies?
Bozzella: I’m genuinely impressed that the survey showed so many executives already have a plan in this space. When I talk with business leaders, I often hear metaverse as a marketing focus or an innovation one; usually, it’s not comprehensive and strategically integrated with the business. These timelines do not align with what I see, as most industries are likely not capable of executing a metaverse strategy in the short term. To paraphrase William Gibson, it’s as if “The metaverse is already here—it's just not very evenly distributed.”
Kornik: When it comes to the technologies that will enable the metaverse, executives told us they are most excited about the potential of augmented, virtual and extended reality (65%) and artificial intelligence (58%), well ahead of blockchain and 3D reconstruction/digital twins. What technologies do you think will be the big game changers in a metaverse future?
Bozzella: I think the verdict is still out on what the big game changers are going to be. Generative AI has the attention of people now and will receive significant, immediate investment driving innovation. Digital is in the midst of an epochal change—these enabling technologies of AR/VR, AI/ML, blockchain, start to point to a digital environment that’s more aware, more personal, more invisible, and one where users will be in more control. Watch for great augmented, virtual and extended reality experiences that help us collaborate in meetings and consume entertainment in new ways. Look for large, massively multiplayer gaming experiences with huge adoption. Look for “VR-chat-esque” social platforms—or the adoption onto existing social platforms—with user communities of notable size. Experiences should be universal across industries whereas other technologies, like blockchain, will be critical to select companies that focus more on the mechanics of the industry. How they come together is part of what we and our clients will have to build, but the change is really exciting!
Digital is in the midst of an epochal change — these enabling technologies of AR/VR, AI/ML, blockchain, start to point to a digital environment that’s more aware, more personal, more invisible, and one where users will be in more control.
Kornik: Finally, when we asked what could potentially put the brakes on their metaverse plans, almost half of the executives said cost (44%), followed by privacy/security, interoperability, technology infrastructure, user experience/enthusiasm, regulations/agreement on standards, and hardware/devices. What would be your advice to these executives?
Bozzella: There are a few strategic pieces of advice that I would share with any executive who is concerned about any of these potential roadblocks to metaverse adoption:
- Work with the business to identify the most practical use cases that will yield ROI.
- Start small and seed a small cross-functional team and give them autonomy to tackle the roadblocks outlined above.
- Talk to your team members, listen to what your organization is using/leveraging at home and outside of work—you will learn a lot!
- Keep cyber and resilience as standing board topics, even when not at elevated risks, to create the muscle memory and potential energy for when action is required.
- Ensure your risk infrastructure is calibrated to the technologies, processes and integrations you really anticipate using.
- Recognize that there will be roadblocks and plan for them. Fail fast, iterate and learn—the risk of doing nothing is greater than the risk of doing the wrong thing.
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Law and order in the metaverse? 'Possible but difficult,' says Sydney-based innovation lawyer
Law and order in the metaverse? 'Possible but difficult,' says Sydney-based innovation lawyer
Law and order in the metaverse? 'Possible but difficult,' says Sydney-based innovation lawyer
Nick Abrahams is the Global Leader of Technology & Innovation for Norton Rose Fulbright (NRF) Australia. NRF has more than 4,000 lawyers in more than 50 offices around the world. Abrahams is a speaker on future trends and innovation, and he created the world's first AI-enabled privacy chatbot, Parker. He is the founder of the online legal site LawPath, and is on the boards of Integrated Research, a software company; the Garvan Foundation, the global leader in genomic research; the Vodafone Foundation; and the Sydney Film Festival. Joe Kornik, Editor-in-Chief of VISION by Protiviti, caught up with Abrahams to discuss law in the metaverse.
Kornik: What do you—and Norton Rose Fulbright—see as the biggest legal issues related to the metaverse? Are many of these Web 3 issues just extensions of what the legal system has been dealing with in Web 2?
Abrahams: The metaverse can be a truly transformative technological advancement, which can revolutionize personal and commercial life. Many brands have already taken advantage of this and are using the metaverse as a medium for employees and customers. However, operating in the metaverse comes with certain risks, a number of which are new and unique to Web 3. Some of the legal issues associated with the metaverse and Web 3 include:
- Data security and privacy: Metaverse projects may result in an increased collection of data, including personal information. Such information is at risk of exploitation, particularly where that information is transferred between platform operators, or between applications within a platform. Platform operators will need to ensure they have robust security measures in place in order to govern data transfers, maintain information security standards, and ensure compliance.
- Conduct: In Australia, the eSafety Commission fosters online safety by exercising powers under the Online Safety Act 2021. The Online Safety Act expanded and strengthened Australia's online safety laws, giving the eSafety Commission improved powers to help protect all Australians from online harm. Metaverse projects may involve collaboration between end users and represent another forum for online harassment, which raises a safety concern. As an example, Roblox recently brought an action against a content creator, alleging the individual had been engaging in harassing behaviour against other users in violation of the Roblox terms of service, as well as local fraud and abuse laws.
- Land ownership: Property laws govern physical real estate, and owners usually have a deed that gives them incontestable claims on their land. That claim is not as clear in the metaverse. Similarly, there is always the risk of theft. It is not uncommon for crypto assets to be stolen from an owner’s digital wallet through manipulation of authentication steps. This would result in a loss of a claim to ownership of a person’s digital property where law enforcement agents would likely be unable to retrieve the stolen assets due to the volatility of the metaverse. Finally, we do not know how long metaverse platforms will be operating. To invest thousands of dollars into a platform without any guarantee that it will exist is a real risk. Both Decentraland and The Sandbox’s terms and conditions state that the companies will hold no liability if the platforms cease to operate at the company’s exclusive and sole discretion.
- Intellectual property: Many companies have filed patent applications for multiple technologies that employ user biometric data for powering what they see and ensuring their digital avatars are animated realistically in the metaverse. Many of these IP applications have been filed for brand protection, which is similar to, or an extension of, what we have experienced in Web 2.
It is not uncommon for crypto assets to be stolen from an owner’s digital wallet through manipulation of authentication steps. This would result in a loss of a claim to ownership of a person’s digital property where law enforcement agents would likely be unable to retrieve the stolen assets due to the volatility of the metaverse.
Kornik: You touched on this earlier, but since no one entity owns the metaverse, and it’s largely unregulated, can we enforce real-world laws in virtual worlds? And are the consequences the same?
Abrahams: The question of enforcing real-world laws in virtual worlds is complex, as it raises issues regarding jurisdiction, sovereignty, and the application of laws to virtual spaces. In general, the enforcement of real-world laws in virtual worlds is possible but difficult. The lack of clear legal frameworks for virtual spaces means that it can be challenging to determine which laws apply and who has the authority to enforce them. Additionally, the fact that virtual worlds are created and operated by private entities further complicates matters, as these companies may have their own terms of service and community guidelines that users are expected to follow. For example, Interpol said earlier this year that it is looking at policing metaverse crimes, but it’s difficult to define a “crime” in the metaverse. It will be a complex area and it may require some global coordination by relevant authorities.
Kornik: I think one legal issue that pops to mind for a lot of people thinking about virtual worlds revolves around personal interactions in the metaverse. We’ve already heard about harassment, so how are we to think about these interactions from a legal perspective?
Abrahams: It is important to note that the legal landscape surrounding the metaverse is still evolving, and lawmakers, policymakers and industry stakeholders are engaged around the world to discuss these issues. Interactions in the metaverse obviously transcend physical boundaries since they can involve participants from around the world. As such, given different countries have different laws, it can be a complicated area to navigate in terms of enforcement, especially when applying existing harassment laws to the metaverse. Platform operators, as we’ve noted, have an additional layer of responsibility to ensure that they take appropriate measures to protect users from and prevent anti-social behaviour online. Again, we think coordinated action will be required on a global scale to ensure relevant authorities can proactively address such concerns, in particular establishing frameworks to share information, coordinate investigations and enforce laws across borders to help combat crimes in the metaverse.
Interpol said earlier this year that it is looking at policing metaverse crimes, but it’s difficult to define a “crime” in the metaverse. It will be a complex area and it may require some global coordination by relevant authorities.
Kornik: Some of the biggest success stories in the metaverse are from a branding or marketing perspective. What are the potential pitfalls there from a legal perspective? What should executives be aware of when entering the metaverse?
Abrahams: From a legal perspective, there are several potential pitfalls, including:
- Trademark and copyright infringement: In the metaverse, it's possible for users to create avatars, buildings and other digital assets and content that could potentially infringe on existing IP protections.
- Privacy issues: In the metaverse, users may share personal information or engage in behaviours that could raise privacy concerns.
- User-generated content: There is a potential for inappropriate or illegal content to be created by users in the metaverse, and it is important for companies to take steps to monitor and moderate user-generated content.
- Regulatory compliance: The metaverse is a rapidly evolving space, and there may not yet be clear regulatory frameworks in place to govern certain activities. Internal legal counsels should ensure compliance with applicable laws and regulations.
Kornik: There’s been talk about regulation of the metaverse for a variety of reasons, including to keep checks on the private sector. What are your views of regulation in the metaverse and how could any regulation be enforced?
Abrahams: Existing data protection laws and regulations, such as Australia’s Privacy Act 1988, and regulatory bodies like the Office of the Australian Information Commissioner (OAIC) and the eSafety Commissioner offer a basic level of protection for users, but perhaps further consideration should be given to enacting specific laws and regulations due to the novel challenges and evolving risks posed by the private sector. Certainly, the government is considering the creation of an AI Safety Commissioner (as recommended by the AHRC’s 2021 Human Rights and Technology Final Report). The European Union and the United Kingdom have proposed regulatory models that could serve as examples for how Australia might regulate AI and the metaverse. The European Commission has suggested implementing an AI framework that would take a risk-based approach to regulate and even prohibit certain aspects of AI systems. The UK, on the other hand, has opted for a more flexible approach that emphasizes collaboration between government, regulators and business rather than specific legislation. Although these models are still in their developmental phase, they could help inform how Australia, and perhaps the rest of the world, decides to implement its own reforms and protections.
The European Commission has suggested implementing an AI framework that would take a risk-based approach to regulate and even prohibit certain aspects of AI systems.
Protiviti insurance experts discuss the future of asset protection in the metaverse
Protiviti insurance experts discuss the future of asset protection in the metaverse
Protiviti insurance experts discuss the future of asset protection in the metaverse
What will insurance look like in the metaverse future? To help sort it all, the VISION by Protiviti podcast welcomes a panel of Protiviti insurance experts, including managing directors Shawn Seasongood and Tom Luick, as well as director Jackie Simmons. Alex Weishaupl, a managing director with Protiviti Digital practice, leads this important discussion.
In this podcast:
1:30 - Key issues in customer experience
5:40 - Claims processing
9:50 - Employee experience and talent
14:45 - Metaverse and consistency
18:25 - Unlocking strategies
23:02 - Speed of change by types of insurance
28:45 - Constraints that will slow adoption
35:25 – The next 10 to 15 years
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.
Alex Weishaupl is a Managing Director, Protiviti Digital – Creative and UX Design. He is a digital design executive with a deep history of helping clients envision, build and evolve customer experiences that help their organizations find and deliver on their vision and purpose to build rich connections with their audiences—both external and internal.

Shawn Seasongood is a Managing Director leading the Finance and Performance Management segment. He assists clients globally in business and system transformations to address growth, scalability of systems, challenges and process effectiveness. He is also one of the lead Managing Director in the areas Property & Casualty, Life Reinsurance and Broker Insurance operations, risk management and controls, and understands insurance rules and regulations, processes and risks.

Tom Luick is a Managing Director with more than 23 years of experience helping clients in the insurance and banking industries solve technology, compliance, and risk management challenges. Tom is a member of Protiviti's Technology Consulting Solution leadership team, a DEI champion for our Chicago office, and an advocate for education in the community. Tom's principal areas of practice include helping clients realize and protect value by transforming their technology risk management and governance functions.

Jackie Simmons is a Protiviti Director in Indianapolis and has more than 18 years of leadership and business experience working with a variety of organizations to enhance their business performance through strategy, internal audit, risk management and business analysis.

Lamina1 CEO says open metaverse, blockchain optimization key to unlocking online future
Lamina1 CEO says open metaverse, blockchain optimization key to unlocking online future
Lamina1 CEO says open metaverse, blockchain optimization key to unlocking online future
Emerging technology and entertainment executive Rebecca Barkin sits down to discuss her role as CEO of Lamina1 and what attracted her to the company, a layer 1 blockchain providing builders and creators a usable framework to create an "open metaverse" for a better online future. Lamina1 was co-founded by Neal Stephenson, who coined the word “metaverse” in his 1992 sci-fi novel Snow Crash.
In this interview:
1:25 – New era of digital life
3:48 – Lamina1 and the open metaverse
9:31 – The creator economy
11:55 – Biggest concerns
13:50 – An optimistic 2030
16:03 – Neal Stephenson’s vision
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.
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Humanity in the age of the metaverse with CJ Casciotta, founder of Reculture
Humanity in the age of the metaverse with CJ Casciotta, founder of Reculture
Humanity in the age of the metaverse with CJ Casciotta, founder of Reculture
Joe Kornik, Editor in Chief of VISION by Protiviti, interviews CJ Casciotta, founder of Reculture, a messaging and production studio, and author of the forthcoming book The Forgotten Art of Being Ordinary: A Human Manifesto in the Age of the Metaverse, about the importance of keeping it real in the age of virtual worlds, and the business advantages of doing so.
In this interview:
1:05 – What is Reculture?
3:10 – A human manifesto in the age of the metaverse
6:15 – A crisis as serious as climate change
9:10 – Avatars vs. humans
11:45 – Generational divide
12:45 – What’s a business leader to do?
15:30 – Optimism about the future
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.
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