Matthew Ball on how the metaverse will reshape the future of everything – Video transcript

Joe Kornik: Welcome to the VISION by Protiviti interview where we look at how current megatrends will impact global business over the next decade and beyond. Today, we’re talking about the metaverse future.

I’m Joe Kornik, Editor-in-Chief of VISION by Protiviti, and I’m joined by Matthew Ball, managing partner of Epyllion which operates an early-stage venture fund as well as an advisory arm. He is a leading global authority on the metaverse and you may have seen him interviewed on CNN, CNBC, VICE, the BBC, or in the New York Times, Washington Post, Wall Street Journal, The Economist, and many more. He’s the author of the important and very influential book, The Metaverse And How It Will Revolutionize Everything.

Matthew, thank you so much for joining me today.

Matthew Ball: I’m excited to chat.

Kornik: Matthew, let’s start with the title of your book, The Metaverse And How It Will Revolutionize Everything. You don’t see this as just a Web 3 but rather sort of a watershed moment with almost immeasurable impact.

Ball: That’s quite right. I understand the degree to which the title can seem bombastic. Certainly, it is backed by a number of different third-party perspectives. Jensen Huang, the founder and CEO of Nvidia, estimates that roughly 50% of world GDP will eventually sit within the metaverse. Various estimates from Citi bank, Morgan Stanley, KPMG run from between $2.5 trillion to $16-trillion-plus dollars by the end of this decade as it relates to the world economy, in contrast to about $102 trillion as of 2022-2023.

Behind this is a fundamental distinction between how we often envision the metaverse—a giant video game, a virtual reality headset—and how the technologists who were pioneering it understand it. That is to understand it as a successor state to today’s internet, not fully replacing the internet as we know it today but much like the cloud and mobile computing era, it builds upon that foundation, TCP/IP forged in the late 70s-early 80s to produce new experiences, that leads to new devices, that leads to new software, that leads to new applications.

When we’re talking about the metaverse, to build it, we are therefore talking about fundamentally overhauling, re-architecting, transforming one of the world’s most important consequential technologies, one that itself has transformed almost every individual market, country, political culture, climate, and the individual—and that’s the internet.

Kornik: Right. For those trying to wrap our heads around its impact, you mentioned some of those forecasts and some of those various estimates. Some of them value the global metaverse economy could be as much as $15 trillion by the end of the decade, by 2030. Is that realistic?

Ball: The fun thing about these forecasts is that they’re really a question of allocation. You realize that we often talk about the digital economy, digital businesses, the internet economy, but no one really says this is the precise value. Why? Because it’s a question of allocation. The UN generally embraces an estimate and says 20% of world GDP is digital but, of course, allocation is the name of the game there. How much of AT&T’s revenues are digital? We know what percentage comes from mobile smartphone subscriptions but, of course, part of that is for voice communications.

When you purchase something from Amazon.com, is that a digital purchase? Is that an internet purchase? The internet is certainly the channel for the purchase but if you purchased my book, it’s a physical book that was manufactured physically. It’s distributed and fulfilled physically. It’s consumed physically. You might say, well, 90% of that is physical revenue, but what happens when it’s an e-book? Certainly, the allocation should change but what is it? What happens when you discover it through social media as opposed to an outdoor billboard?

What really matters about this is not whether or not the metaverse is $2.5 trillion or $10 trillion. It’s recognizing that almost all of the world economy runs on the internet. We may say 20% is digital but the remaining 80%—agriculture, energy, transportation—that certainly runs on the internet. That is certainly digitally powered and to the extent you’re an investor, digital is the growth engine, the opportunity for displacement-replacement. We’re looking at the metaverse as a game of allocation but more important is the transformation of value, both on the increase and the substitution replacement side.

Kornik: Interesting. How far away are we right now from the metaverse being mainstream?

Ball: I want to start by disabusing one of the challenges with the metaverse narrative today. This is an idea that has had a name for about 30 years. It has been varyingly described for close to a century. What’s new, of course, is that we’re talking about it all the time, most obviously because Meta changed its name from Facebook. When most people were building the metaverse a few years ago, they talked about it as a multi-decade transformation. That is my frame of reference. There’s a second cohort that talked about five to 10 years. In fact, Mark Zuckerberg and John Carmack, the CTO of Oculus, talked about it as a five-to-10-year transformation.

But there was another cohort, including Sachi and Adello or Bill Gates, many in the Web 3 community who talked about it as imminent, if not here now. The challenge of that last perspective is, it raised expectations, even though such as Mark Zuckerberg started to lose that battle where people started to say, “If the metaverse is here, why isn’t my life more different? Where are the revenues? What’s the product I can buy and how is it different?” I think of this as a transformation, but what’s most important here, and certainly relates to investors and entrepreneurs, is to recognize that the question of “when is a technology mainstream?” is a bit elusive. It’s actually not that practical a question. Certainly, the timeline matters, but all technologies about when is what available for whom, when, how, and why.

The mobile era began in some regard in 1973 with the first cellular call. In 1991, we had the first 2G network. That was the first digital wireless network. The first smartphone came in 1992. That was IBM, by the way. We had the Apple Newton in ’94, BlackBerrys in the late 90s, the first direct-to-consumer media services in the early 2000s in Japan, but we would really say that for the average person the smartphone and mobile cloud era felt present until 2007, 2008. We have the coincident launches of the iPhone, then Android, then the iPhone App Store.

But even if you say it began in 2007, 2008, the average American did not have a smartphone until 2014. The average human didn’t have a smartphone until 2020, and so for them, it would be wrong to say that the mobile era had arrived prior to, truthfully, 36 months ago. For you and I, Joe, I imagine the answer to the question when was mobile here was probably 1998, 1999, and so that’s how we think about it. There’s a technology question. There’s a demographic question. There’s an application question, and there’s a sector question.

Kornik: Right, and I think some of those, maybe those early predictions around timing and how long before the metaverse became mainstream, might have led to some of the skepticism right now that we’re seeing around the metaverse, some of the stops and starts, particularly among business leaders, I think, you have a challenge. They’re probably not engaged with the metaverse very much at all. How would you suggest they started to begin to map out a strategy around the metaverse?

Ball: I think that’s quite right. The immediacy to which the metaverse emerged as a buzzword, plus the learnings of internet and mobile disruption, led many to start asking themselves the question, “What is our metaverse strategy?”—if not demand outright that they establish one, that they start testing one. The challenges here are the intent is right, but often I found the business leaders didn’t have a good sense of what it was they were trying to establish. What were they trying to solve? What were they trying to answer? What was the problem that, what I would define as real-time 3D simulation technology, could answer? If the question is you want to start a think-tank, that’s a legitimate objective. If you wanted to make a signal to the market, to your peers, to shareholders, to perspective employees about the seriousness through which you are taking this transformation, about your willingness to experiment, that’s all valid. But the broader question is, if you go back to the question, the metaverse is not a when, it’s a when is what here, why, how, and to what end? Business leaders need to start from, what’s the problem we’re trying to solve for?

Often, it’s as simple as establishing a digital twin that aids industrial design and then potentially supplements live operation. That doesn’t require you to imagine a future state that’s that different. It doesn’t imagine or require you to deploy VR headsets. It just requires a focused exemplar and business case.

Kornik: You talked about Web 2.0 and mobile earlier. We saw some legacy companies, well-established brands disrupted to the point of extinction because of it, and we say we saw new companies emerge in that space. Do you expect a similar sort of fate for companies in Web 3 in the metaverse? Do you expect new players to emerge and old, more established brands to maybe go by the wayside?

Ball: Certainly. If you imagine that the metaverse is as transformative as I imagine it to be and the forecasts of third-party agencies are to be realized, then you almost have to imagine that there’s going to be widespread disruption in displacement because the technological platforms and software and services that we use today will change. I imagine this change in five buckets that we’ve seen throughout history. The first of those companies which will perish, they’ll be so significantly disrupted that their business model and going concern evaporate. Blockbuster is a famous example of that. You can think of web crawler as another, and the search engine space replaced by PageRank and Google.

The second or companies which actually do endure but they languish because they’re so far surpassed by another company in that space. Skype and ICQ exist but, of course, the leading instant messaging services of this era are tens if not hundreds of times larger than those services were even at their peak, and that’s partly because they reimagined fundamental premises. Skype was designed to speak to traditional telephony systems. WhatsApp does that, but Snapchat does not. Slack has no interest. In fact, it’s organized around enterprise APIs. Of course, Instagram reimagines it as a picture-centric medium.

The third category or companies which do port over and indeed grow because the TAM (technology acceptance model) in the digital economy has grown, Disney is not of the digital era but it’s larger and reaches more customers because of it. Apple was reinvented in mobile and is larger because of it. Facebook was threatened by mobile and, of course, predated it, but it reached 2 billion daily active users last quarter because of the lack of constraints that mobile offers in contrast to PC.

The last two categories, however, are my favorite. The first are those companies which are displaced in their core business but grow because of growth in what used to be their side arms. Microsoft is the classic example. Microsoft has never had a smaller share of computing operating systems than it does in 2023. At one point, market share was as high as 96%, including mobile. Today, it’s less than 10% in the Western world and 5% global. Yet Microsoft reached new highs because of its horizontal services which no longer reached just 100 million Windows users, but potentially billions of mobile users across multiple different operating systems. IBM is more valuable than ever, even though it has been decades since it held the dominant position in computing devices for the average person.

The last category are the new entrants who take advantage of this new platform and the new generational shift to displace some of the aforementioned companies. Right now, we see that most classically is Google in the PC era, Facebook, and, to a lesser extent, TikTok in the social and mobile and cloud era. Right now, we’re making hypotheses as to what the new metaverse services and platforms will be.

Kornik: Matthew, if I could ask you a best-case scenario and a worst-case scenario for the metaverse future, I guess what I’m asking is what could go right and what could go wrong?

Ball: When we talk about what could go wrong, there are really two different questions. One is to talk about the impediments to actually constructing the metaverse. The internet was commercialized after it was established and indeed, it was established around the premise of exchange. That is what the internet is. The term comes from internetworking. Really, we had a fleet of standards and protocols which supported myriad different use cases. The idea that AT&T, Telefonica, IBM, Verizon, Comcast, China Mobile can all exchange an email with the same structure, none of them actually managing the global system for email, is remarkable. Of course, many of these companies try to have their own de facto networking standard.

One of the things that can go wrong is not that the metaverse doesn’t happen, but the various for-profit initiatives and endeavors mean that where it is established, it’s limited and therefore, while we talk about the internet and the software layer on top of it, it’s perhaps possible that there’s very little commonality for the metaverse. This pollyannish ideal of an interconnected 3D simulation is not possible, just the limited exchange of information with highly siloed and comprehensive but for-profit kind of islands within it. You’ll see that from the 70s through the 90s, there was an expectation that’s what the internet would be, we’re very fortunate the internet was not, but that doesn’t mean that history will repeat.

The second thing that could go wrong is to understand that there are many downsides with the internet as it exists today and the metaverse will challenge many of them. Most of us are dissatisfied with the role of algorithms, the contribution of the larger social platforms to our state of mind or well-being or happiness. I would certainly say that data rights and data security aren’t what they need to be. More broadly, we still contend with harassment toxicity, mis- and disinformation, and radicalization on the internet. Going to a live shared, more global, 3D-immersive experience will not make those problems easier. It will make them harder, and it will also deprecate some of the best practices that we’ve established over the last decade.

In addition, some of the virtual reality and extended reality devices and technologies that we envision will produce very severe challenges. Right now, many of us contend with the fact that Siri listens to everything that we say, but Siri doesn’t see inside your home. It doesn’t see your tax returns. It doesn’t see your children running through the home. Trying to figure out how we progress, how we regulate, how we figure out what the requirements should and shouldn’t be, that’s going to be a real challenge, and I do think that there’s a way in which we can fear that outcome.

But if you ask me what can go right, look, the internet has been not perfect—far from it—but I would certainly argue it has done far more good than ill. It has certainly given voice to billions who lacked one before. It has made the global economy more competitive and fostered greater openness. But we discussed earlier that many companies may be displaced by the metaverse. That means their business models, their philosophies, and their leaders will as well. It’s very hard to affect change midcycle because of the entrenched leadership, but to the extent in which we’re dissatisfied with the metaverse as it exists today, I actually think that the swap to a next platform, plus the learnings we have as consumers, developers, users, governments, affords us a rare opportunity to reset the internet as we know it today to be a better one in the future.

Kornik: So interesting. Matthew, last one for me. Envision, if you could, 2035. Let’s go out more than a decade. Can you give me an example of something that perhaps I haven’t thought of that will just blow my mind?

Ball: Well, I can’t speak to what you haven’t thought of, but I can tell you that the category that I am most hopeful about is education. Education is a really important category for a few different reasons. Firstly, its value is self-evident but it’s worth highlighting that not only is it a substantial portion of the U.S. economy. You’ll note that it is actually the single sector of the U.S. economy which has seen the greatest cost increase since the internet was formalized in the early 1980s. Costs are up about 1,400% to 1,500%. In contrast, healthcare, which many consider to be an albatross on the economies, up half as much. It’s still crippling 600% or 700%, but education is twice as bad. That’s because, for all of the benefits of the internet, it hasn’t meant that we can actually teach cheaper than ever before. We don’t teach faster than ever before, and we don’t teach more effectively a larger number of students than ever before. If we want to solve for cost creep, we also need to find a way to change that dynamic. I’m further hopeful that we can finally start to address some of the longstanding hopes for what the internet might bring, which is not just better cost. It’s greater quality and broader reach.

Today, your access to education is primarily limited to the wealth of the school board, the geographic availability of that school board, and the teachers which happen to live there, and that we’re talking about a primarily American concern. Certainly, if you will live abroad in developing markets, really none of those three things are even questions, and we know that just on-demand video on YouTube or digital multiple choice does not really close that gap.

When I think about the metaverse, the idea of virtual classrooms with nearly infinite zero-to-no-cost marginal goods and experiences that have a sense of presence—you can see your teachers’ eyes; you can look to your right and see your peer; you can dissect a feral cat or a dog or an elephant while also going Magic School Bus and traveling in circulatory system. Test physics on the moon and Mars. Go into a volcano as it erupts into the atmosphere, and then be dispersed as particles to understand its impact on the climate. We’re talking about some things that we don’t want to do. Dissections, certainly of some animals we don’t want to dissect, ethics around that, but more importantly, just the availability of these resources. I think idea of making more personal, lower cost, immersive experiences that untether us to resources and geography, that’s what matters to me the most, certainly.

Kornik: Yes, fascinating. Matthew, you’ve given us a lot of think about here today. Thank you so much for the conversation. I really appreciate the time.

Ball: My pleasure. This is a lot of fun.

Kornik: Thank you for watching the VISION by Protiviti interview. For Matthew Ball, I’m Joe Kornik. We’ll see you next time.

It's a brave, new, immersive world, with media and metaverse expert, Luke Franks – audio transcript

Joe Kornik: Welcome to the VISION by Protiviti podcast. I'm Joe Kornik, Editor-in-Chief of VISION by Protiviti, our global content resource looking to the future to examine big themes that will impact the C-suite and executive boardrooms worldwide. Today we're exploring the metaverse and its impact, and I'm excited to be joined by Luke Franks. Luke is an advisor, speaker and presenter who has fronted shows for ITV, BBC Radio One and Sky, as well as branded content for the likes of Netflix, Amazon and Spotify. He hosts the hugely successful and I might add outstanding “Welcome to the Metaverse” podcast where he interviews some of the brightest metaverse minds each week. Recently named one of the top metaverse thought leaders and content creators worth following, Luke's insights have been featured on Vice, the BBC, Talk Radio, and in The Athletic. I'm so happy to have him here with us today. Luke, thanks so much for joining the VISION by Protiviti podcast.

Luke Franks: Thank you, Joe. Thanks for having me. Good to be here.

Joe Kornik: Luke, I’m turning the tables a bit on you here as I know you're usually the one asking the questions. Let me just start by saying I absolutely love your podcasts and your takes on the future of internet culture, Web 3.0, and the metaverse. I've spent a lot of time listening over the last several months to your “Welcome to the Metaverse” podcasts. I've learned a ton by listening and you're obviously a big believer in the metaverse and its almost unlimited potential it seems. It’s impacting nearly everything we do so let me ask you why. Why do you believe in the metaverse? Why do you think it's sort of a can’t miss?

Luke Franks: Yeah. Thanks for the kind words. I appreciate it. Yeah, we’re at a really interesting time I think. What's really happening here is a combination of trends that are all colliding at the same time or about to and we're also at a point where I think there's enough evidence, enough kind of network effects to sort of confirm this fundamental shift, and that's happening in a couple of ways. I think the first is a move towards a more immersive experience of the internet. So from primarily kind of a 2D experience that we're all familiar with on websites and scrolling on our phone and that kind of thing to a more 3D experience in immersive worlds, probably as avatars as we go explore these new places and spend more time there and socialize there. We'll talk about more of that in a second. So there's the experience kind of shift that's happening, and then there's also this native kind of digital ownership layer, which is really crucial to what's happening as well, and that's kind of the Web 3, the blockchain, this sort of NFT component that's in its early days really as well.

So we’re certainly not there in that full vision yet, there’s plenty of work to do and there will be still and there has been obviously lots of failures along the way, plenty of volatility, skepticism. All very normal with kind of big technology technological shift like this. I see it really is as not dissimilar to the adoption of the internet the first time around. A new kind of fundamentally game-changing technology that went through these cycles, these human cycles of fear and greed, boom and bust, but ultimately sort of completely changed all of our lives in varying degrees. So I think that's where we are now. We can kind of dive into that a bit more detail as we go.

Joe Kornik: I'm curious though when it comes to its overall sort of global economic impact, the forecasts are sort of all over the map, right? They range from somewhere around $1 trillion US all the way up to like $15 trillion by the decade’s end. Where do you see the metaverse in terms of its global economic impact by let's say 2030?

Luke Franks: These huge numbers get thrown around obviously a lot. It's kind of hard to quantify, but it's to do really with the scale of what's happening here. So if we look at some evidence, what's happening in a new sort of parallel digital economy and what the next generation is growing up with as well, they're native to it. So Roblox is a good example. Roblox, for anyone who doesn't know but I'm sure plenty of people do, is a virtual world. You go in, you choose an avatar, and you go and explore various kind of mini worlds and mini games and kids are going there to kind of socialize and hang out, all the things that—when I grew up with the internet, I would wait on MSN over an evening waiting for my friends to come online and sort of chat to me. Now kids are avatars and hanging out and socializing and playing in these virtual worlds. If you're a parent, you'll probably know because your kids will be asking you to buy Roblox vouchers so that they can go and buy digital fashion items for their avatars in these worlds. Things that they care about. They care what they wear and look like there.

But yeah, if we look at some evidence, Roblox has about 50 million users a day which is pretty wild. That's a big number. The most visited experience has been played 30 billion times now just recently, which is very well when you think that the most watched YouTube video has been watched 11 billion times, so the next generation are already in this virtual world hanging out there and going back to play with their friends there. As I said, kids massively value their digital identity there. $1 billion plus is spent per year on this for kids buying kind of fashion items and this sort of thing. Over half of all US kids play Roblox every week. So that's what one example of what's happening. Fortnite is another kind of a blend of game play and social virtual worlds. A good example there when we’re thinking about like the scale of this digital economy, is virtual events that happen there. So there was a geek, a rapper called Travis Scott did a virtual show as an avatar there. Twelve million people attended because it was rolled out across the globe at various different times and he reportedly netted about $20 million from those performances, which was the equivalent of doing about 10 back-to-back physical arena shows for him as an artist, so you can begin to understand this kind of scale of digital assets and experiences around the world in these virtual worlds.

So next generation are growing up natively to all of that. They understand that straight away. If we're thinking about the sort of transition of these stages of the internet and where we're going, people talk about Web 1 as to sort of read-only layer of the internet, the kind of you'd hit a website and get back information. People talk about Web 2 as the sort of read-and-write layer where we were able to edit and send information and have things like social media and Wikipedia. This kind of group knowledge on the internet that we could edit. Now we're going towards what people are calling Web 3, this sort of ownership layer in these digital assets at scale. So yeah, that's the key thing, it’s the scale of where these valuations are coming from because it's a pretty big shift.

Joe Kornik: Right. You talked a lot about gaming there. Clearly I think gaming has been the big winner so far on the metaverse or the big entry point for most especially from a generational standpoint, right? The metaverse has really grown. Obviously with VISION by Protiviti we're focused on how business leaders and people much older than those people essentially playing games, or at least most of them, will be using the metaverse. So I'm just curious, are there business lessons to be learned from the success that gaming’s had in the metaverse? How do you sort of see that from a business leader’s perspective? What can they glean from the success of some of those companies you just mentioned?

Luke Franks: Yeah, 100%. I think a lot of this does come from gaming roots, right? Gaming is the biggest entertainment industry on the planet. Bigger than music and film put together. Interestingly as well, the average age of gamers is around 31, so there is this younger Gen Z generation growing up native to it, but there's also a slightly older generation who spend a lot of time playing games as well. When we look at the metaverse, now your brands can fit in there. I think there's also an interesting distinction between gaming and gamification as well, right? We can take some of the things that work in gaming and kind of bring them into this new more immersive world. I'll use Roblox again because there’s a lot of evidence there, but a company brand that has done really well—Nike has built Nike Land in Roblox and it's really interesting because you can go and experience a whole world. They've brought their brand in. It's kind of a sports-themed universe, sort of Nike Disneyland, if you like, where you can go and play, socialize, you can go and collect coins, and there's little gamification mechanics inside that world that keep people coming back, that's why the stats are so big in that world. People want to come back and they want to unlock these things and kind of level up and stuff like that.

So for a brand that’s looking to sell their product, whether it's natively digital or whether it's something that starts digital that they can then also link to a physical item as well or whether it's a marketing play or whatever it is, think about these gamification kind of loops and hooks, and customers spending more time in a brand world is a really attractive thing. It’s a way to kind of really engage people in a new way. There’s lots of kind of interesting examples there. H&M have done it well recently, allowing users to go and co-create with some of their items, digital fashion items in this world. Chipotle did kind of a maze in Roblox as well, so people had to kind of unlock things. Even kind of legacy artists as well, people like Elton John are beginning to reinvent themselves in this new explorable world for a new generation and a new audience. So yeah, it's a big opportunity thinking about it in that way.

Joe Kornik: Yeah. So interesting. I think one of the most exciting aspects of the metaverse is sort of the emerging technologies that enable it and all the new things happening. You mentioned some of them there. When you look at it, what are you most excited about?

Luke Franks: At the minute, a lot of the experiences are on devices that that we know, right? So on a desktop computer or on a mobile. That's where people are. Everybody obviously has a mobile in their pocket, so being able to kind of interact with these worlds in a familiar way is where we are now. We're seeing more consumer VR headsets begin to roll out. So Meta’s Quest 2 has been the one that's been there that’s sort of triumphed where it's been actually making its way into homes. It outsold Xbox in 2021 for the first time ever, so we're beginning to see that finally VR sort of have a piece of the pie in a consumer way.

There's rumors around Apple releasing their mixed reality headset, so the kind of augmented reality layer of stuff I think will get really interesting next year where it’ll be a headset, but you'll be able to see the physical world as normal. It kind of adds layers of reality on top of that, which I think is interesting, so they're kind of happening slowly and that's growing as well. AI has really come into the public consciousness recently with things like ChatGPT because it's so tangible. You can go and use it and that’s a whole separate conversation on its own, but yeah, we're at sort of 0.001% of what AI can do and how it's revolutionizing sort of workflows. If you've not played with ChatGPT, just Google it and go on it and you can ask it anything. It's like having an assistant that has a hive mind of all the knowledge in the world and you can begin to get it to think about SEO for you or come up with a business plan and then you have the art tools where you can create these incredible art pieces and things like that.

I think that all plays into this bigger trend of more immersive worlds that we're shifting to. If we think about going into these worlds, we're going to need the content there and users will build some of that and AI tools will help build that. We're going to need a lot of content. It’s going to need to be immersive and fun and constantly kind of updated and AI has a role to play there as well. So that's all happening. I think it'll be interesting if Apple do drop their headset soon. That may be the next inflection point. If Facebook changing their name to Meta was the first one, perhaps the Apple headset is the next one.

Joe Kornik: Well Luke, you certainly spend more time in the metaverse and these virtual spaces than I do and probably more than most people I know. I know you own digital real estate and NFT horse racing stable and lots of sort of rare digital sneakers so I'm fascinated by this. So for the skeptics among us, including I think plenty of business leaders, and there's a lot of skepticism out there in the business community, help us make sense of that. Are those just sort of cool things to own? Are they investments? Are they just for show? Should businesses be buying digital assets? Should I be buying digital assets?

Luke Franks: Yeah, understandably a lot of skepticism and for good reason as well. Even when there was a big technological shift as I say, greed comes in as it always does for these kind of cycles and we get way ahead of ourselves and things need to correct and go back to a phase of building actually good things with good utility that people want to use, and that's kind of the phase we're in now after kind of the massive hype. In terms of the investment and the NFT side of stuff, where there’s understandably a lot of skepticism, I think it's like any investment really. You have to spend a lot of time doing deep research sorting out the wheat from the chaff of which there is a lot of but understandably and totally agreeable, 95% of it is probably nonsense at this point, but understanding what assets have significance and potential value, why the creator or company’s story is important and relevant and might have an asymmetric return in a digital-first economy if that's the way that we are seeing this trend go. So some of my bets. Yes. Some are for fun, like the horse racing stable thing is, I think it was run where you can own and breed your horse and go race it online. It's kind of ridiculous but kind of interesting and the DNA of each of the horses gets passed down to the child one. It’s mad, but it's fun and interesting and cool. There’s a whole art scene as well, so I have something called a Chromie Squiggle, which if you Google and you look at you'll think, “What is that?” but has a place in the history of generative art on the blockchain proving the uniqueness and using a certain technique. It was one of the earliest ones. So like lots of art, it’s disruptive and weird and people criticize it at the beginning, especially in a big art move, but if it has relevance and historical significance, well maybe that's a bet. Then we talked about the sneakers and stuff like that and that’s kind of a bet on the culture.

There’s a company called RTFKT as it’s stylized, which got acquired by Nike at the end of 2021. They are really pushing the forefront of all these trends that we talked about, this kind of gaming culture, people valuing digital assets, and sneaker culture in this kind of new breed of internet culture there, so there’s some historical releases there. Nike, we're going to move in this space. They had a plan to release something called crypto kicks sneaker. This was all part of what they wanted to do, but kind of RTFKT, this company came along, did it first, and so Nike acquired them in the end. We’re starting to see kind of digital sneakers linked to physical ones as well, so you can kind of connect them and see your physical sneakers story through the digital side of stuff as well. So it's these two things coming together, so that's kind of why where my bets are. They’re few and they're concentrated.

Yeah, that’s my view, is that there's some asymmetric returns here but as always, all the standards are things apply of not financial advice and all the rest of it, but that's kind of my approach from that.

Joe Kornik: it's so interesting. So shifting back to business leaders because I really think they are confused about where they sort of are in this point in time. They're being asked about the metaverse, they're probably making decisions about investments in the metaverse, both capital and resources, time, infrastructure. Clearly the metaverse was hot, then it was not. There were some layoffs. There's been some investment, probably not a ton of return so far. So what advice would you give an executive trying to figure this all out?

Luke Franks: I think if you really want to get ahead, spending some time if you can to understand the technology and how it works at a basic level is really important because once you understand what's happening here and—I can give the very quick example of how I explain NFTs to people—is generally, if you think about a physical item that we all agree is valuable. So if you take the Mona Lisa for example as an art piece and you ask why that is, “Why is that valuable?” It’s kind of valuable for three reasons. The first is that we know who the creator was. Leonardo da Vinci, one of the most famous creators or artists of all time. That story is important there. We also know that that piece is scarce, right? There's only one Mona Lisa that was ever created in the world. We also know who owns that now—the Louvre in Paris, right? We have kind of three criteria therefore what we agree on has physical value. Blockchain, on a technological level, is for the first time ever enabled that same criteria in the digital world so we can now prove who created something, the fact that it's unique and scarce, and track the ownership now, so that's kind of the revolution.

The reason why people got so excited about this was like, “Okay. We can prove value in the digital world.” That doesn't mean everything is going to have value because if your story is not important, then so what? But understanding a technical level is helpful I think because it kind of clicks the pieces together.

I think then go and experience the culture with an open mind if you can. Talk to your kids or young relatives about what they value and why. Why do they want Roblox vouchers for their avatar, and through different generations it might be hard to understand. It’s hard with music moving maybe from physical CDs or cassettes into digital music. Feels like you're not holding anything tangible but those shifts happened, right? It's happening again here as well. So spending a bit of time in the culture and understanding what people value in the space with an open mind I think is important.

hen think about what your product or your service might look like in a more digital and immersive setting. How can you offer that in a way that doesn't alienate your current customers but might be exciting and new and open new avenues in the digital world? Once you've done all of that, then I think you're kind of positioned to make a smart decision about where you fit. I'd say move quickly but thoughtfully and get educated first I think it is the way, especially in this phase now. The hype is kind of moved on a little bit, so it’s a good time to just get educated now and begin to research and plan.

Joe Kornik: Yeah. I think that the danger is thinking, perhaps on some level, too far ahead, right? There are things that could be happening in the short term. Are there short-term business/short-term gains that could be had in the next 18 months or so rather than thinking about the metaverse is something that's a decade or a decade before we see the full impact of 3D and all this sort of various things that come along with that?

Luke Franks: Yeah. I think we've been through some of the evidence that's there. If your product or service fits in that and you maybe don't want to go fully deep into the whole blockchain space of releasing your own NFTs and you need to understand why you would do that, you need to understand that you'd be building a community around this stuff that's tradable. If you're not ready to kind of go there, maybe you dip a toe in the centralized options that are there. These virtual worlds, maybe do an activation and experiment with it for a few weeks and see, “Do I get that engagement back? Has it been helpful? Has it sold products?”—whatever it is, and maybe try it there temporarily without going to spend millions by buying land in one of these worlds that's in a very early phase. So I think going to the place where the evidence is to experiment is probably a good thing. If it was me and I'd be hiring somebody into, or getting somebody in to go through this, and through the education, and through what's happening, and through the culture of the space just to make sure it's not running away from you, but you don't have to put all your eggs in your basket and make some outsized bet if you don't fully understand why I think is the key thing here.

Joe Kornik: Last one for me. Now I am going to ask you to sort of think a little further out if you could. Give me your vision of this space whether we call it Web 4 or Web 5, I don't know what's going to be called a decade or more from now. Let's go out 10 years. What do you see in this space or in the metaverse in 2033?

Luke Franks: Yeah. Huge question. I think anyone who says they know is lying because nobody for sure does know. I think we'll probably see the metaverse adopt, in a similar way to how we saw the internet adopt the kind of first time rounds, except much faster because when the internet was adopting, we didn't have the information rails of the internet, right? So we're moving faster and all the technological shifts are happening in a short amount of time and AI is going to supersize all of that and make everything faster than before. It doesn’t mean there won’t be volatility and we won’t get things wrong along the way, but I think it adopts this experience of a more immersive internet and digital assets and people caring about adapts more is going to adopt, first with the younger generation and the early adopters who are already here and that's already happening, and then gradually through the older generations to a lesser extent exactly like the internet did.

But I do think the dawn of AI can't be overstated really. I think my big predictions is that it's not really going to fit into the models of society that we have now. It's probably going to reorganize it in ways that we can't fully imagine yet. I think it'll be a lot of controversy, a lot of misinformation, a lot of volatility, but also loads of positive outcomes that humans are bad at predicting as well. We always jump to the kind of the fear and crave safety with any shift as well, but I think there is lot of good will come from all of this. That is happening now as well.

Those that learn about it and—adapt now have the most upside potential for sure—but in time I think the digital economy will become more valuable than the physical economy because of that scale that we talked about at the beginning. It’s just unrivalled, right? You can't possibly recreate that in a physical way, so the scale of digital assets being sent around the world with no physical product that's needed to ship them and it's tradable on an open marketplace all the time, I think that will happen in time. But ultimately yeah, I hope that our digital lives will be will be richer, more social, and immersive. There'll be better experiences. It's not about replacing physical reality, it's about replacing the hours on end of scrolling on the screen on Facebook or Instagram or LinkedIn or whatever you do, replacing that with a with a richer, more social experience, right? We’ve seen the trend towards less unnecessary work travel and less physical goods. That can be a good thing. Hopefully we’ll have richer digital lives and hopefully richer physical lives in a more sort of sustainable way as well. Or I think AI will destroy us all, so time will tell. We’ll see. [Laughter]

Joe Kornik: Well on that note, Luke, yeah, I think we'll wrap it up there. Thank you so much. This was fun. So enlightening. Thank you so much for the conversation.

Luke Franks: Thank you very much for having me. Appreciate it for having me on and it's been really fun.

Joe Kornik: Thank you for listening to the VISION by Protiviti podcast. Please rate and subscribe wherever you listen to podcasts and be sure to check out all the metaverse content we have at vision.protiviti.com. Also you should certainly look in on Luke's podcast, Welcome to the Metaverse. We have a link to it in his intro and bio and in the show notes as well. Thanks for listening. We'll see you next time.

How we’ll work in the metaverse with futurist Jennifer Vessels, CEO of Next Step - video transcript

Joe Kornik: Welcome to the VISION by Protiviti interview. I’m Joe Kornik, Editor-in-Chief of VISION by Protiviti, a global content resource looking to the future to examine big themes that will impact the C-suite and executive boardrooms worldwide.

Today, we’re exploring the metaverse and its future impact, and I’m excited to be joined by Jennifer Vessels, a futurist, transformation advisor, CEO of Next Step, and founder of the Executive Growth Alliance, an innovation ecosystem of top companies. Jennifer has worked with Adobe, Cisco, Google, Genentech, G.E., Novartis, and many others where she advises executives on how to leverage the latest digital, technological, and societal trends, including Web 3 and the metaverse, to become future-ready. Jennifer, thank you so much for joining me today.

Jennifer Vessels: It’s great to be here. I’m looking over to our discussion.

Joe Kornik: Yes, me too. The idea of future-ready is what VISION is all about, so I’m really excited to talk to you today about the metaverse and how companies can leverage it to become future-ready. I’ve read all sorts of forecasts, and I’m sure you have as well about the metaverse and what it all means to the global economy over the next decade or so. What do you think ultimately will be its impact and when will we see that impact?

Jennifer Vessels: I believe it will have a significant impact in the next one to eight years, in particular, and part of that comes from just looking at the way society is evolving. If we think back 30 years ago at 1992, which seems like a long time ago but really 30 years is not that vast, at that time that was really the beginning of the internet as we know it and what I would call Web 1 that allowed us to communicate with people in minutes as opposed to days or weeks to send communications. That evolved over 10 years to Web 3 or the World Wide Web, which is basically what we’ve been using over the last 20 years that has, I believe, fundamentally changed  the way business works. It certainly changed the way each of us as individuals live, shop, access entertainment, travel, experience one another, and we really saw that during the pandemic that the World Wide Web was our lifeline.

Through the last five years, a new infrastructure has evolved, building on what we have today but progressing to Web 3, a new evolution that allows for more immersive experience, not just reading, not just looking, but experiencing. That takes everything that we’ve learned through gaming, takes the AI capabilities that have been developed, takes what we know about human behavior, and brings it into a whole new level, which is what I find is referred to as the metaverse where we can interact through digital tools in a new way. That is built on this Web3 infrastructure, which is a redesign of the internet using cryptography, using very advanced algorithms to allow people securely to be able to digitally connect, interact, transact, and conduct business. That I believe will become more and more prevalent in all organizations over these next one, five, eight years such that when we get to, let’s say, 2030, the metaverse-type of environment will become an integral part, possibly the entire part, of many organizations, industries and the way we work.

Joe Kornik: You described yourself as a future-ready innovator and a futurist and you’re exactly the type of person that we need, that we should be talking to for this particular topic, the exact type of person that we need to offer us some insight as to where this is all going. How will we work in the metaverse? What do you think is possible? What do you see businesses doing to enhance their brand in the metaverse?

Jennifer Vessels: One of the things I am most excited about with the concept of the metaverse is the fact that it will reduce borders. It will allow people anywhere in the world to have access to others anywhere in the world in order to explore, to research, to develop. There is a concept in use today in a lot of advanced corporations of a decentralized autonomous organization or a DAO. Think about IKEA as an organization that is developing future-ready textiles based on sustainable products. They can now not only have people working in Sweden, but easily have people that commit on a shared contract with shared ownership in the Philippines, in Africa, in Poland, in Turkey to develop new capabilities. The concept of the metaverse and Web 3 will allow a more secure way of interacting with people outside of the borders of location or even corporations. These can be new ways of extending the concept of a skunk works, let’s say, allowing for more diverse values.

Now, that also brings up a number of questions around governance that honestly have not been fully explored or any standards developed of, what are taxation requirements? What does ownership mean? There are a lot of these questions that need to be explored but I think will fundamentally change the way we look at how we do business with one another.

The other aspects are just around areas such as, for example, education. Education up until today is still a very traditional way of having either students in K through 12 or adults coming into a corporation, sitting into a room and listening to people talk about what you should do. Through Web 3 and metaverse types of applications, people can experience. On-the-job training can be done from one’s living room before they start the job. They can be experiencing and role-playing and dialoguing and working with a digital twin of the kind of equipment they will use. Children will go to school from wherever they are, experiencing what it was like to be in the world of the dinosaurs, to live through periods of apartheid, so it will fundamentally change our understanding because we will have a different level of experiential education for people coming into the workplace but also in the workplace itself.

The other area that I believe will fundamentally change is the concept of finances. Today, in our capitalistic society, everything is about an exchange for money. As we move into metaverse Web 3, the type of exchanges that we do are more towards tokens, which could be a bitcoin. It could be this concept of an NFT, a non-fungible token that allows you to exchange a representation of something. Maybe there are ways that we can leverage tokens that go back to sustainability. I think over time, maybe 10, 20, 30 years, that our concept of value and how we exchange value for products and services can evolve in whole new ways by getting out of this concept of dollars versus euros and borders and structures. It’s a much more open, embracive and diverse way of exploring and working together.

Joe Kornik: What other industry sectors or disciplines do you think will be most enhanced by the metaverse?

Jennifer Vessels: I think across all sectors, the customer engagement will be broadened significantly because as customers, we will have access to anything, anywhere. The financial sector will shift completely, where banks, as we know it, financial institutions will need to embrace a new role of helping people redefine wealth, helping people redefine their options and transactions. Education, we talked about. Manufacturing will evolve. We’ve just only begun to start a tiny little bit on things like 3D printing, but think about the ability to be able to have anything you want created wherever you want it. Heavy industries such as oil and gas, some of the sea exploration, even farming—concepts where we used to have people go out on the platforms in very dangerous conditions, we can minimize that today by having digital twin so people can be in a safe, secure environment while controlling the fertilizer that’s going into the ground or the type of pumping that’s happening in the subsea station.

It will fundamentally change I think the way we all interact with one another, with business, with finance, and with the planet, but one thing that I do want to point out is, while I talk about these changes with technology doing more and more for us, I believe it’s going to make the concept of people and the value of people even more important because technology is that platform. It is the foundation of the park. The swing sets and the tools on the playground, they are the tools that in order for us to experience and evolve, we as people need to develop our unique skills of communication, of problem-solving, of understanding how to leverage these tools, understanding how to bring people into the environment. I believe there is an increasing role of need for high people skills while we relegate some of the more mundane, some of the more dangerous, some of the more challenging fundamental physical processes to the technology.

Joe Kornik: Right now, business leaders I know are struggling with, as they think about the metaverse, all of them are sort of being confronted with the metaverse and being asked about the metaverse or where their business is going in the metaverse. I’m curious, your thoughts on how business leaders should be investing in people and resources, how they should measure ROI on those investments. Where should they start and what should they be worried about? What are the red flags that they should be looking at along the way?

Jennifer Vessels: The biggest red flag would be to sit on the sidelines and wait and see, which is, I think for a lot of people, the first tendency. The best thing that a leader can do is to indeed lean in and embrace the concepts, not only research and listen to a webcast and interviews but actually start trying something. Get a pair of 3D glasses, whether it’s Quest or Oculus or whatever it is. If you have young people in your life, they’re using those kinds of tools. They’re in gaming. Jump in and play with them, begin to experience. Set up a digital wallet. It doesn’t matter which type of bitcoin or cryptocurrency, but the experience of setting that up, go into a Web 3 application and purchase. For a small amount of money, purchase an NFT, sell it to somebody, just to get the experience, because this is the kind of environment that you need to embrace. It’s immersive. You’re going to learn by trying.

I find in the companies that do lean in and are in a good position to start using and leveraging this technology, the leaders are experiencing and the leaders are also encouraging their team members to take time, to take time each week to try something different. Encouraging lunch-and-learns, web sessions, let’s experience and let’s explain and let’s work together on what we’re learning because this is a whole new world and the only way you can get there is to go through.

Talk to your customers. Talk to your customers about what they want. Are there areas where you could possibly start doing some immersive training with those new hires? The digital natives that are coming into the workplace now, anyone under the age of 35, they’re going to demand access to these kinds of tools, so start with them. And that can be in on-the-job training. It can be in marketing to those folks. Talk to your marketing teams about creating an NFT that could be used in some of the social media outreach, a great way of engaging the younger consumers.

Start small. Start small, try something, explore, experiment. I believe the next one to three years is going to be a very exciting time, a time when we’re all learning and learning together so that in five to 10 years, we really have that opportunity to embrace and use what we’ve learned to move forward in a whole new future-ready society.

Joe Kornik: Jennifer, I have one more question. You’ve been very generous with your time today, so I appreciate that. I think it’s a fun question. You just referenced the one-to-three-year window get us ready for the five-to-10-year window. I’m wondering if you could even go out further than 10 years and take us out a decade or more and tell us something about the metaverse and its overall impact.

Jennifer Vessels: Well, considering the speed of technological growth when we look at things like AI and the ChatGPT and a lot of these technologies, I would say in another 10 to 15 years, let’s say in 2035, 2040, we will look back to these conversations and say, “Wow, we were very, very antiquated.” At that point, I would envision that we will be able to reach anyone, anywhere. Travel will be redefined completely. We will have access to experience the beach even in the midst of massive rainstorms. It will be a special experience to go and be in a physical environment. Our work will be completely redefined. It will not be a nine-to-five. We will work when we feel we need to, when we feel it’s part of our mission, when it’s part of our passion. We will no longer measure ourselves by exactly what’s in our bank account, but by what our impact is on the planet and we will have access on a global basis to the right resources, whether it’s healthcare when we need it, whether it’s education for our children, whether it’s new opportunities or new research capabilities that will be available to us.

Now, there may be some people that choose to stay in only the old physical environment and that’s okay, but for those that really want to embrace, I believe, will be able to have a much freer, much more integrated, much more sustainable in many ways because our work will be giving back to society and creating more value for the world but also involving the planet because that’s becoming more and more apparent that our society and the way we involve one another has to give value not just to us but on a broader scale.

Joe Kornik: Right. Well, it will certainly be a different world and I can only think that will be a better world.

Jennifer Vessels: I certainly look forward to that.

Joe Kornik: Thank you, Jennifer, for joining me today.

Jennifer Vessels: Thank you. It has been wonderful to be here and I’ve thoroughly enjoyed our dialogue, and I look very, very forward to seeing you again somewhere in the physical world or in the metaverse over these next decades.

Joe Kornik: It might be our avatars meeting up for a coffee somewhere in the metaverse [laughter]. Thank you for watching. For Jennifer Vessels, I’m Joe Kornik. We’ll see you next time.

The Economist’s Dexter Thillien: Key findings, forecasts on the metaverse future - video transcript

Joe Kornik: Welcome to the VISION by Protiviti Interview. I'm Joe Kornik, Editor-in-Chief of VISION by Protiviti, our global content resource looking to the future to examine the big themes that will impact the C-suite and executive boardrooms worldwide. Today we're exploring the metaverse and I'm excited to be joined by Dexter Thillien, the Lead Technology and Telecoms Analyst at The Economist Intelligence Unit to discuss the metaverse and its impact on global business, including some key findings of research the EIU conducted on the topic. The EIU is the research and analysis division of The Economist Group, providing actionable insights and helping to identify opportunities, trends and risks for business leaders in a complex global environment. Dexter, thank you so much for joining me today.

Dexter Thillien: Great to be here.

Joe Kornik: Dexter, you specialize not just in the metaverse of course, but in sort of a unique space, the intersection between technology, strategy, industry, and geopolitics even. Now, the metaverse means a lot of different things to a lot of different people and we can certainly talk about some of those other definitions or Web 3.0 or XR, AI, 5G, blockchain, but let's start narrow if we could. How do you and how does the EIU define the metaverse and sort of where do you see it fitting into that strategic space going forward?

Dexter Thillien: So we actually have a pretty broad definition of the metaverse. We kind of define it as being an online immersive world leveraging external reality, which can be augmented or virtual reality. You will also be using a lot of different technologies, so we're talking artificial intelligence, we're talking cloud computing, we're talking edge computing, digital twins, the most advanced form of connectivity, so just 5G and fiber, and even crypto-based technology if we start to talk about Web 3.0. So we’re kind of looking into it as a way of the new paradigm in terms of what it is in terms of technology and new ways of doing things to kind of being far more online and new ways of using the internet. So it's kind of a very, very big and it's also something that's going to be used, as you mentioned, not just for consumer, but also for enterprise and obviously, policy makers will look into it as well with greater scrutiny than they might have done in terms of other technology in the past. This is a big paradigm, potentially a very, very big shift, and this is what we're looking into even though it's still a fairly niche technology right now.

Joe Kornik: Right. I know the EIU has recently published some research on the metaverse about its potential impact, investment, usage and how it differs from some of those other technologies, for instance, Web 3.0. What were some of those takeaways and key findings from that research that you could share with us?

Dexter Thillien: Yes. So the metaverse is one of our main key themes for 2023. So we released our “Industry in 2023” white paper, in which we’re the part on telecoms and technology and we’re going to see that [Unintelligible] AI, semiconductors, as well as consolidation in the overall telecom sector.

As I said before, we don't expect it to become a mass market technology in 2023, but we do expect investment to continue to flow. What we highlight for 2023 is kind of the move towards great [Unintelligible]. It has been the metaverse [Unintelligible], so that's going to be a very important development there, potential use cases on the enterprise side, and obviously as well the difference between the metaverse and Web 3.0. While we're seeing the overlap, they’re distinct concepts. Web 3.0 is obviously based on decentralization, and this is ownership around different users, and this can happen outside the metaverse and we've seen it with finance and also de-fi, so decentralized finance; whereas the metaverse can be centralized potentially, so the different types of metaverse is possible. So we're trying to highlight the differences because sometimes they tend to confuse a fair amount of people.

Joe Kornik: I'm just curious, I know that research is a little more near focused. In Vision, we like to look 2030 and beyond or even a decade out, which is difficult to do with something like the metaverse. Do you have a time frame on when you think that the metaverse will be sort of a big game changer for businesses? I mean how far out do you think we need to look for something like that to happen?

Dexter Thillien: I think it’s going to be during the decade it becomes a major technology or major new paradigm. I think for me, it’s important maybe to look back in terms of where we see the metaverse fitting in terms of the evolution of technology and internet. So if you think of the PC era, late 90s-early 2000s, we had dial-up, broadband for kind of a broadband connection, which has created a boom as well as a bust and kind of a lot of different application and companies coming to the fore. So Amazon, Google, and Facebook were created during that first era.

The second era was probably smartphone and mobile connectivity, so in the 2010s, 4G, 5G coming in and led to the creation of kind of apps that we're using everyday—Uber, Instagram. If the metaverse has some of these proponents, say, is becoming kind of that third stage or like kind of third evolution of the internet or technology, so this is a vessel to use of external reality and if it's on par with the previous two, you can see that the impact would be enormous. What we're seeing right now, which I think is very important, that a lot of companies are investing quite a lot because nobody really wants to miss out. Nobody wants to be left behind. Even though it might take a bit of time. It might not happen in 2023 even in 2024-2025 or be towards the latter part of the decade, nobody wants to miss out.

Joe Kornik: Sure. You mentioned those conversations. I'm sure they're happening in in corner offices right now in C-suites and at the board level about steps they should be taking. So what is your advice to business leaders? What should they be doing right now to prepare for that inevitable future?

Dexter Thillien: I think overall, business leaders should be ready to use technology and apply digital transformation solutions. I think we've seen since Covid, so since 2020, it has become a matter of when, not if and I'm very biased because I'm a tech analyst, but when, not if digital transformation will happen and this will occur because eventually every company will become a tech company. I think the metaverse is one of the ways business leaders can transform the company, both internally and externally, but I think it's important not to maybe look at the metaverse as kind of a new shiny technology to be using or try to be kind of ahead of the competition, but to understand why they want to use a metaverse. Just think of outcomes as opposed to technology.

In my view, a successful digital transformation process, you can have the metaverse as part of it. It's about knowing what you want to achieve as a business as opposed to using a specific technology. So if you want to use a metaverse for a specific goal and it’s a critical goal for your business, start looking into it and see how you can apply it to your technology, for your company internally with your employees, so you can apply it externally with your client, but if it's just using the metaverse to put out a press release saying, “Company X is using the metaverse. Look at how advanced we are,” but there's no kind of plan behind it, that's probably going to end up in failure. So knowing what you want to do, the right outcome, and looking at what the metaverse can do, that's the way for me for businesses to think of the technology right now.

Joe Kornik: That's interesting. I think that's one of the big questions around the metaverse is how will it be used? How will it be utilized? Who will be the winners and losers? So when it comes to how businesses will use the metaverse and again, we can look a decade out or more or however long you think before it really becomes a game changer for business, what do you envision?

Dexter Thillien: Yeah. So if we’re seeing the metaverse, as I mentioned, that kind of surge power sway of the internet to do certain [Unintelligible] internet, you can see the implementation is going to be huge. So just an example, maybe you can split it between consumer metaverse, enterprise metaverse, and industrial metaverse. So consumer, or you buy and sell, or you attract new clients, especially younger demographic which are probably going to be using kind of virtual reality or that type of reality a bit more, social interaction, any types of event and entertainment you can think of. Gaming is obviously a big one. In terms of enterprise, about collaboration, training, and education within the company—very, very important. In terms of industrial, kind of maybe operational improvement and kind of development. So maybe a few examples, just the things we’re seeing. In terms of education, we're seeing kind of a fair amount of different schools or different universities looking at augmented reality/virtual reality as a new way to teach different topics.

That kind of leads into training. We think kind of using virtual reality for ongoing training development. So in healthcare, we learn to do specific surgery using a virtual reality handset. You can relate to travel. It can relate to defense, manufacturing, anything you can think of. Digital twins, which is a kind of a virtual replica of the digital asset, again, multiple applications in many, many sectors. We're seeing increasingly metaverse real estate happening, so this is obviously to highlight new product and services to a new range of different users, so the younger demographic targeting there, and a couple of companies specific example of what company have been saying looking in terms of the metaverse.

So Accor, which is a big hotel chain headquartered in France, they're looking at the metaverse as a way to being able to visit the hotel before you go, visit a specific room, look at what’s around the hotel and all the different amenities, so kind of a new ways of doing things with much more virtual, much more immersive as opposed to reading them on the screen or seeing them in the video. You also have Disney. So Disney has a big streaming service with hundreds of millions of users. It also has parks, which also has tens of even maybe hundreds of millions of visitors coming, kind of the metaverse can be the bridge between the two so people that can’t really visit the park physically, they might be able to visit the park virtually at least for certain amenities there.

So there's a lot of different ways and because it's a very, very new, I'm sure I'm going to miss a lot of them and again, if you go back maybe 10 years in terms of what we're doing with smartphone now, what we thought we would be doing with smartphone 10 years ago and not for other things that we couldn't even think of could happen. If it does become that mass market technology, that kind of new paradigm in terms of the internet, there's going to be an awful lot across the board—internal, external, consumer, enterprise, industrial. A lot of new ways of doing things going forward, so it could be a very, very big change for other companies and companies will need to know what to do and we need to implement those changes as well.

Joe Kornik: Sure and the possibilities seem endless and I'm going to ask you about that in just one minute. That's going to be my last question, but my second to the last question is about skepticism because there is quite a bit of skepticism about the metaverse out there. So I was curious to get your opinion on that. Is it warranted? What are some of the potential pitfalls of the metaverse and are there things we should be worried about or things that we should be pumping the brakes on a little bit about the metaverse in terms of whether it's cyber or some other potential pitfalls?

Dexter Thillien: Yes. I think it's right to be skeptical. I prefer to call it realistic. In terms of potential issues of any technology because nothing is ever perfect and always positive. I think for the metaverse I probably can highlight four different ones, which I think are worth looking at. The first one is hype. So very often in the tech world we tend to over hype the technology saying it’s going to change the world and sometimes it never actually does or sometimes it actually takes a bit longer than expected. There’s a famous quote which says that, “We tend to overestimate the effect of technology in the short run and underestimate it in the long run.” So for instance, if you look at blockchain, I've been hearing about blockchain for the past 10 years. Ten years ago it was going to be that huge new thing that everybody was going to use. It hasn’t really happened. There's some very interesting use cases happening, but it hasn’t become that mass market technology so maybe the metaverse has some very, very nice use cases for certain areas, but doesn't become that kind of mass market technology, that mass market paradigm we're expecting right now.

The second would be kind of a lack of standards in interoperability. So if you want to be an early adopter and if you use a standard that's going to become very obsolete very quickly, that's an issue because you're investing into something that basically stops existing very, very quickly. And you can also have potentially your creation of multiple metaverses according to the modern uptake, if you have systems which are way too different, not standardized, not working with each other.

That kind of leads to a third point, which is regulation. Regulation because technology is not geopolitical and strategic, so if you talk of geopolitics, lack of standards. If you have different standards between different countries, that’s kind of an issue, but also strategic, policymakers, politician regulators are scrutinizing the tech sector even more. So issues relating to ethics, to the competitive landscape, to content will in my view be looked at much more closely than they were in the past. So that's something to look into as we develop the technology.

And I think probably a fourth one, you mentioned cyber security, its always going to be an issue with any kind of technology going forward, but I think—and the final one I want to add—is sustainability. Climate change is the issue of today and if you're talking about the mass market metaverse, it's likely to be using far more data and far more energy, and that could potentially lead to a backlash if the use cases aren't made in terms of the positivity or if the use case is a bit frivolous. People would say, “Why are we spending so much energy and so much data to do that when climate change is an issue?” So for me those are the things to kind of look into and to make sure as we develop the metaverse that those issues are being resolved and solved after.

Joe Kornik: So, Dexter, last question for me like I mentioned is about a future world. So if you could take me to 2035 let's say—and there's been a lot of projections and forecasts about what the metaverse could be, its economic impact or the type of jobs or whatnot—I'm just curious to see your overall thoughts. If you could take us to 2035 and tell us what kind of world will we be living in in terms of the metaverse and its impact on our daily lives and specifically our businesses going forward.

Dexter Thillien: So I think if the metaverse becomes from what we expect it to be, we’re more likely to be living far more virtually than we are right now. That doesn't mean 24/7. I don't think we're going to the world where we're going to have a headset any time we’re awake during the day. I think that’s going to be probably a bit weird and probably going to come far later. I think again, it's important maybe to look at the past and try to understand what the future might look like. So I mentioned those three stages earlier and I want to focus mainly on the second one in terms of the mobile revolution in 2010. So we got the first iPhone in 2007. The first 4G network became available around 2010. It was still not very clear where it was going, but this has become ubiquitous and I think if you look at the iPhone, which I think for me it's always something I look into in terms of development of technology or far technology or important technology can be—the iPhone with a revenue of about $20 billion between 2007 and 2009, so doing quite well, but not super high. $30 billion in 2010 starting with 4G, $60 billion in 2011, $85 billion in 2012, and now we're talking about $200 billion in 2022. So this is probably the best case scenario for the metaverse.

There's a drive towards that goal, but this is kind of the best case scenario so we’re kind of going into world the same way that the iPhone or smartphone has become ubiquitous, the metaverse and having augmented glasses or headset that you're using at home or at work to do meetings to do training or to learn or even to watch content. Instead of watching Netflix on the screen, you're watching Netflix on the headset. This is kind of the best-case scenario in terms of where the metaverse, so living in a far more virtual world, far more opportunities to do things, far more kind of 3D as opposed to 2D. So this is where we're going. If you look at the iPhone, which is kind of the best case scenario, again, we've seen the growth going from $20 billion in the first three years to $200 billion a year in just over 15 years, which is not that big of a period of time. So this could potentially happen with the metaverse if everything falls into place.

Joe Kornik: Thanks, Dexter. So a game changer or niche product?

Dexter Thillien: For me, I think it's probably more likely to be a game changer than a niche product because everybody is looking into it. Everybody's looking to invest into it. There's clearly demand in terms of—the first version of the metaverse is happening in terms of gaming which are very successful especially with younger demographic and it’s going to be the one driving it in 10–15 years’ time. The people who are teenagers now are going to be the consumers of tomorrow, within that timeline and they're going to be doing - living in terms of the virtual world that maybe people from my generation which [Unintelligible] smartphone. So I do think we’re probably more likely to become a game changer because a lot of investment, lot of potential demand, and companies are going to want to try to either retain their strength and retain their position in the market or some new ones are going to try to become the new big companies or the new big tech companies from the 2020s and 2030s. So I would say game changer.

Joe Kornik: Thanks for those insights, Dexter, and of course the insights from the Economist Intelligence Unit. Always great to hear your thoughts on the metaverse. Thank you for watching the VISION by Protiviti interview. For Dexter Thillien, I'm Joe Kornik. We'll see you next time.

Customers will lead companies into the metaverse, says Coupa VP for Africa and the Middle East - podcast transcript

Joe Kornik: Welcome to the VISION by Protiviti podcast. I’m Joe Kornik, Editor-in-Chief of VISION by Protiviti, our global content resource looking to the future and examining big themes that will impact the C-suite and executive boardrooms worldwide.

Today, we’re exploring the metaverse and its implications for business, and I’m very excited to welcome longtime technology expert, Julie Tregurtha, to the program. Julie is Area Vice President for Coupa for Africa and the Middle East, where she heads up a team responsible for the promotion of Coupa, a software company based in San Mateo, California. She has been a leader in the IT industry for more than three decades and resides in South Africa. Julie, thank you so much for joining me today.

Julie Tregurtha: Thanks, Joe. It’s lovely to be here, talking to you today from Johannesburg, South Africa, and I’m really excited about this conversation we’re going to have.

Joe Kornik: Right. Julie, you’ve been a leader in the IT industry there in South Africa for over three decades now, so there’s a lot about technology that I’m curious to drill down and ask you about, specifically about the metaverse. There are many implications to the metaverse, right, and there are technologies that will enable it. We’ve heard a lot about them—Web 3.0, XR, AI, 5G, blockchain, etcetera. The list goes on and on. Which ones are you most excited about as we start to move into the metaverse, and why?

Julie Tregurtha: Joe, I think you’re right. There’s a lot of different aspects to the metaverse from a technology perspective and, actually, all of these pieces have to come together because it’s not going to be underpinned by one thing. It’s going to be underpinned by so many different pieces and elements. It’s hard to pick one that I think is, for me, most exciting but I think the one that maybe we just relate to the most is the XR piece, extended reality—everything from what we understand as reality today through the spectrum of augmented reality and  virtual reality, and I think along with that, the devices and the hardware and the capabilities that you’re going to have through different XR technologies that are really going to open up this new world of the metaverse to us as consumers. Maybe that’s the piece that I found most intriguing for me to get excited about.

5G network, it has just got to be there and it has got to work, but it’s not something that you’re necessarily going to touch and feel. It’s more an enabler, so perhaps that’s why I feel that the XR piece is the most interesting. Having said that, all of these aspects have to come together, work together and, obviously, reach the right technology level that they need to be at in order for the metaverse to really become something that’s real.

Joe Kornik: Right, and that’s interesting because XR, certainly, there has been a lot of advances over the last several years. There has been some—I think as those devices get smaller and more user-friendly, we’ll probably see a lot more adoption. I think we tend to think of them from a gaming standpoint, but I’m more curious about how you think businesses will use the metaverse and particularly maybe they’ll be using XR, I’m not even sure, but what are some of the ways that you think strategic business leaders will be leveraging the metaverse?

Julie Tregurtha: I think it’s really exciting. We’re right at the beginning of that journey. If you have a look at the metaverse up to now, it has certainly occupied a bigger role in the consumer space. Companies that are starting to experiment and invest in this are very much consumer-related businesses—FMCG, retailers, big brands. Those are the first movers, but it’s definitely, in my opinion, not going to end there, and I think that irrespective of the industry that an organization plays in, I don’t think they can ignore what impact this is going to have on their market, their customers—whatever those customers look like and how they behave and interact with those customers—but they’re going to have to consider this. I think that there’s so much opportunity. I think there will be so many use cases across different industries that will emerge. They’re not necessarily known yet. They’re not necessarily documented. Nobody has necessarily put those out there yet, but I think as we move more and more into the space that the use cases will come out that we maybe don’t even think about today.

The one that I think as well pops into my head because it’s cross-industry is training. If you are trying to train using this type of technology internally to train users, train your employees in something, and it could be anything, whether it’s putting together the components of a product that you created or if it’s in a healthcare industry and you want to practice how to do a heart transplant, it doesn’t matter. I think there’s going to be a lot of cases where the metaverse can be used for training, education, learning more of how the world operates in a particular business.

Joe Kornik: I have to say when I talk to business leaders, there is a lot of—maybe not a lot— but there’s a fair amount of skepticism out there about the metaverse and its overall impact, and I’m just curious your thoughts on that. Is that warranted? I’m just curious when you think about if you’re talking to business leaders that are a little bit more skeptical about the metaverse, what do you say to maybe ease their minds?

Julie Tregurtha: My view is I don’t think it’s warranted. I don’t think it’s warranted, and I say that because I’m fairly comfortable that this is going to be a wave that is going to come. It is definitely going to come and it’s definitely going to impact and affect everyone in terms of the way that we operate in our world. Yes, it’s complex. It’s very undefined. You look for a definition of the metaverse today and you come up with so many different things. It’s vague. It’s confusing. There are very few people that really, that even ask me to understand this whole world. It is actually quite overwhelming.

I think that’s where the skepticism is coming from. It’s more based on a lack of understanding and a fear perhaps than based on any justified view that this is just really going to remain something that is going to be out there but it’s not going to affect me. I think that it is coming, and I think if you have a look at some of the big organizations that we know have a massive impact on all of us—Apple, Meta, previously Facebook—these organizations are investing, Microsoft, they’re all investing a huge amount of money in this wave.

It is maybe still regarded as hacked. There are views that it’s a metaverse bubble. It’s not going remain out there as just a peripheral thing. I really do believe that the—maybe we don’t know what the full impact is going to be today but it is absolutely going to be part of our future world.

Joe Kornik: That leads me to my next question. I was going to throw around some of those global economic impact forecasts, right, for the metaverse for, let’s say, 2030 and beyond. They’re all over the map, everything from a little under a $1 trillion to all the way up to $15 trillion, depending on which particular study you look at. Would you categorize on the scale of the metaverse being sort of a nice complementary niche platform for some companies to take advantage of versus all the way to a revolutionary game changer for global business by 2030 and beyond, where would you fall on that spectrum?

Julie Tregurtha: I believe it’s going to be a revolutionary game changer. My caveat is, in your question, by 2030, I think that is the piece that I wouldn’t necessarily hang my hat on. I do believe it’s going to be a revolutionary game changer, but I think it might take a slightly longer timeframe to get there to that point than 2030. For many, many years, the way that we discovered and purchased and consumed goods and services was through physical interaction. It was visiting a store, picking up a product, touching and feeling it, attending an event, or booking a service, and that was the way we did things. Then the internet came around and e-commerce platforms started to pop up and rival the offline world.

Then what happened was we got hit by COVID. COVID really changed everything and if you look at—and I’m mentioning this because I think it comes back and touches this, why a revolutionary game changer. If you look at what happened with COVID and how it changed so many different elements of our lives, physical stores closed and the only way that you could really purchase anything was on an e-commerce platform and it became the sole portal to purchase and to get goods delivered. Social engagement was restricted to telecommunications and social media networks, and obviously, COVID also changed the way that we work. Companies had to switch over to Zoom and Teams overnight from being office-based, face-to-face, and onsite.

Other industries, the entire entertainment industry came to a massive, just at complete standstill. And even manufacturing industry, factories were closed and plants shut down because they laid off workers. You think about the changes that we’ve gone through and how those things managed to create a drastic shift in the way that we do things. Now, the world has semi-returned to normal and yet I’ll bet you that most people are still engaging with the e-commerce portal to do their shopping. They’re still working on Teams and people are not back in the office full-time. The adoption of this technology was kind of all forced, forced because of circumstances. We had to find a way to keep our lives and our world running, even though we were all locked up into our homes. I think the metaverse really points to the next kind of generation of that, the next creation of an alternative solution to the way that we operate to really enhance how these technologies have impacted our lives by taking them to the next level.

Joe Kornik: Right, and you’ve mentioned several sectors and you’ve mentioned some service lines like supply chains and from a sector base, we’ve heard manufacturing, we’ve heard healthcare. We’ve heard some potential success stories. Do you have any thoughts on what sectors you think have the potential to be the most disrupted or transformed by the metaverse?

Julie Tregurtha: Joe, I think that it’s going to fit all industries. I think any industry that thinks they’re free from being affected by the metaverse is going to be naive in their thinking. I do think that the B2C type of industries are going to land up looking at this first because, again, it’s “Where does their target audience hang out?” If you have a look today at where people are hanging out, it’s quite extraordinary already how many people are visiting some of these metaverse worlds and how many hours are being spent, perhaps not by my generation but certainly some of the Gen Z and even the Gen Alpha, the next generation. In fact, it’s quite scary I think how much time is being spent there.

I think that the B2C, the organized, there are industries like FMCGs, the big brands, the retailers, if they want mindshare, brand awareness, they want to find subliminal ways of reaching their target audience, it’s already happening. They’re already doing this. Samsung has bought land in Decentraland. J.P. Morgan has opened a virtual bank, and there are other examples. I think there are definitely industries that are going to go there first and go there early.

I think the entertainment industry is going to be looking at this in a big way. Fascinating that Justin Bieber did a metaverse concert in 2021 and attracted 10.7 million viewers. I think it’s definitely the entertainment industry and events industry which was so badly hurt by COVID, so I think for them, it’s not only a way maybe to recover but also a very interesting way to reach a much larger audience than what they were traditionally if they were trying to do just a Madison Square Garden concert.

I think there is then the opportunity in the corporate space and I think if you have a look—I mentioned J.P. Morgan, so FSI, financial, banking, insurance—those organizations are often quite forefront of adopting technology. They’re often quite pioneering. They’ve got the pockets, deep pockets to look at how to invest and how to better service their customers. Maybe it is more around trying to create a far better service-oriented environment for an experience for their customers.

I think the other one which is really interesting, I mentioned healthcare from a training perspective, but there’s talk about Philips as an example, creating their own corporate metaverse, which really becomes a destination for patients to go and get access to virtual healthcare, and I think that’s really interesting. That is really exciting.

Joe Kornik: Right, and Julie, thanks so much for all this great information. I have just one more question for you. I just want to wrap up by asking you to look out into the future 10 years, 15 years, 20 years, as far as you want in terms of when you think the metaverse will really be making a major impact on all of our lives. Paint me a picture of what’s possible. What am I missing, like what aren’t we thinking of?

Julie Tregurtha: I think the view 10, 15 years out is a scary one and it becomes a controversial one because you have this potential vision where people sit in their homes, in their lounges, with their virtual reality headset on. They go to the office, their virtual office, and they sit in a boardroom and have meeting with a team but they actually don’t leave their lounge. When they want to buy something, they go to the virtual mall and they go and try on clothes and check out the new latest coffee machine and experience the latest set of golf clubs and then pick which one they want to buy. They don’t even have to go on holiday because they can go and choose to walk the Great Wall of China or go up the Eiffel Tower or go look at the Niagara Falls and they don’t even leave their lounge. If you want to really be extreme and, as I said,  controversial, that is a view of the future. I think the movie Ready Player One encapsulated some of that, where really we all live in a virtual reality. We all live in an alternate universe and we actually almost want to leave our reality because maybe it’s not that great.

I think that is a—do I see that happening? Not for me, because I wouldn’t want that and I think for me, it’s really important to still embrace reality and have physical contact with people and things. But I think that is a scary view out there because I think the possibility could exist that you maybe never have to leave your lounge, and that is a scary possibility and that starts introducing so many other very, very tricky conversations, psychological and mental and physiological impacts of the metaverse on the human race.

I’m hoping that it maybe doesn’t get to that extreme. I’m hoping that it really becomes—as smart phones didn’t stop us talking to each other face-to-face, it was revolutionary and that it created and connected the world and not only telephonically but from a social media perspective, but it didn’t necessarily replace our face-to-face contact. I’m hoping that maybe the metaverse—it’s going to alter our world but hopefully enhances it—doesn’t replace some of those really cool things which are essential to being human. That’s what we’ve got to hold on to.

Joe Kornik: Absolutely. Thanks so much for joining me today. I really appreciate it.

Julie Tregurtha: Pleasure, Joe. Thank you for having me and thanks for the opportunity to have the conversation.

Joe Kornik: Absolutely. Yes, this was fun.

Thank you for listening as well. Please rate and subscribe wherever you listen to podcasts, and be sure to check out all the great metaverse content we currently have online at vision.protiviti.com. I’m Joe Kornik. We’ll see you next time.