How your business can benefit from the metaverse: PwC

Summary

Don't believe the hype: the metaverse is an evolution, not a revolution. And it's one that business leaders should not ignore.
The metaverse will change how businesses and consumers interact with products, services and each other.
Key metaverse concepts and technologies are already business relevant, even if this new digital world is far from fully mature.
The metaverse offers opportunities today for workforce transformation, customer engagement, operational efficiencies, new revenue streams and more.
Risks are real too: new technologies require new strategies and new methods to build trust.

When it comes to the metaverse, few business leaders would consider themselves experts. Some may wonder if it even matters to their companies. The short answer: yes, it matters.

In fact, several metaverse concepts and technologies are already business relevant. Others will be soon. Enterprise applications — such as training employees and simulating operations — are taking the lead right now. But companies are also using the metaverse to engage customers and grow revenue. In our 2022 US Metaverse Survey, 82% of executives said that metaverse plans would be part of their business activities within three years. Since then, the metaverse has advanced and developments in generative artificial intelligence (AI) have made metaverse initiatives even more accessible for business.

But it may not always be a linear advance. The metaverse could well follow the path of other innovations, such as artificial intelligence and the internet: with cycles of boom and bust that include pockets of speculation, overvaluation and unwise investments.

The good news is, it’s possible to separate the reality from the hype: understand what the metaverse is really about and take practical, affordable steps to meet your company’s needs.

What the metaverse is — and what it means for business

The metaverse promises a stunningly realistic 3D digital world where you can do almost anything that you can in the “real” world — and more besides. Like the real world, and unlike today’s web experiences, much of this digital world will persist even when no one is in it. And as some technology visionaries imagine it, one day the metaverse won’t run on platforms whose owners control data, governance and transactions. Instead, customers (and businesses) will be able to take their identities, currencies, experiences and assets anywhere they wish.

With a full-fledged metaverse you could, for example, put on a virtual reality (VR) headset and visualize your global manufacturing network. You could zoom in on a factory on the other side of the world. You’ll see and touch its machines, inspect its operations and even shake hands with the local supervisor — all without leaving your desk. You could even send one digital version of yourself to that factory, while another meets with your board of directors. Consumers could hop from one competing virtual car dealership to another, feeling the wind in their hair as they take test drives. And after you leave that digital recreation of a factory, it will keep producing in parallel to your physical factory. The virtual car will await its next virtual driver.

For business, the implications of an immersive, persistent and decentralized digital world could be enormous.

Even if this vision isn’t yet a reality, aspects of it are up and running today. Already, companies are using immersive metaverse environments to:

Recruit, onboard and train employees
Make workforce collaboration seamless across geographies
Simulate and enhance operations with digital twins
Enrich the customer experience
Market and sell existing, “real-world” products and services
Market and sell new virtual products and services
Collect new data on customers while respecting privacy and consent
Offer hardware and applications that support metaverse activities.

These opportunities exist right now, and more are emerging constantly, because the metaverse is not, in fact, a revolution.

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The metaverse is evolving and accelerating

The metaverse was first described and named almost 30 years ago — but we’re still in the early days. Computing power, headsets, software protocols and networking capacity just aren’t ready yet to support a truly immersive and shared metaverse.

Yet this future is coming, as the culmination of a long-running trend: for innovative new technologies to blend into a greater whole. At PwC, over the past decade we’ve identified the most important new technologies for business and how they’re converging, in ways that are starting to make parts of the metaverse possible.

Today, cloud technology is addressing the processing power and storage to support extended reality and immersive interfaces. Hyperconnected networks that leverage 5G are nearing maturity. Generative AI is making it possible for non-specialists to create compelling immersive experiences. The decentralization of finance, as supported by blockchain, is making partly automated financial systems possible. Finally, digital-native consumers and the pandemic’s impact on consumption habits are igniting demand for the virtual products and experiences that the metaverse offers.

Today: The seeds of the metaverse exist as isolated experiences, where assets and value are not interoperable or interchangeable. Future: Landscape of virtual spaces with transferable identities and assets enabled by blockchains that are interoperable or interchangeable.

Still largely missing is the metaverse’s promised interoperability: a digital world where you and your customers can transition seamlessly among multiple experiences offered by various providers. This connectivity will require a new architecture for the internet, often called web3. The idea is that first came static web pages (web1). Then came our current internet (web2) with dynamic content, but only within platforms that companies own and govern. Web3 is supposed to be a decentralized structure with countless interoperable platforms. Like the metaverse itself, web3 is not yet complete, but elements are operational and creating value today.

What makes a metaverse: key concepts to master

One way to think of the metaverse is as a set of opportunities from which your company can select a few to focus on. Based on our years of work with the technology trends that are now converging to form the metaverse, we’ve identified six concepts that are the metaverse’s foundation.

Some of these concepts are already mature enough that they can grow existing lines of business and create new ones. Companies in retail, real estate, and entertainment are already investing and earning profits. For other, less mature metaverse components, getting in at the start will help your company be ready for however the metaverse may evolve. Either way, these components require an attention to trust and values — without care, this new digital world could exacerbate risks both to your company and to our society.

When assets, transactions and identities simultaneously exist in physical and digital worlds that billions of people and organizations share, the old ways of building and sustaining trust may no longer apply.

The following are the six concepts that make up PwC’s metaverse framework:

Economy

Even though most metaverse platforms today work just fine with credit cards, cryptocurrencies, non-fungible tokens (NFTs) and other blockchain-based digital assets will likely underpin the future of value exchange in the metaverse. Further innovation will be needed as governments and companies work to build trusted digital monetary systems, offer new data monetization propositions and conduct lending, payments, real estate investment and more in the metaverse. Decentralized autonomous organizations (DAOs) — with voluntarily agreed-upon rules enforced by a computer program that runs on a blockchain — will likely play important roles.

Interoperability

A true metaverse requires seamless interoperability among users and platforms, based on web 3.0 and still-to-be-determined standards. While this interoperability will offer new possibilities to reach and understand customers, it will also raise new challenges for gathering and protecting data, and for cybersecurity and privacy. It may also undermine business strategies built around keeping users and their data in a given platform. Competitive advantage may shift to those companies that offer (through hardware or software) trusted ways for users to enter the metaverse.

Governance

The metaverse will need rules of engagement for users, rules for how the metaverse itself can change over time and enforcement mechanisms, including for tax collection, data governance and regulatory compliance. Early movers may be able to help set these rules. Security will be paramount, as a new, decentralized digital world may offer malicious actors a new world of entry points for attack. Authenticity — and trust more broadly — should also be front and center, to reduce the disinformation that has often plagued the internet.

Identity

In the internet today, identity is often linked to platforms. It may be true, pseudonymous or anonymous. The metaverse, decentralized and interconnected, will need trusted digital identities — for people, assets and organizations — that port across platforms. Companies active in digital identity now may both help set the metaverse’s standards and be able to offer a necessary service. Digital identities may also be central to permitted data collection and data governance in a decentralized environment.

Experience

Today the metaverse is often accessed through phones or computer screens. But as extended reality (XR) technology matures, an immersive 3D digital world will offer unique experiences, based on its own aesthetics. Some trends for these experiences are already becoming clear, in games and virtual environments. Companies that create trusted metaverse experiences and protect privacy rights may win consumer loyalty, while those that stay on top of metaverse trends may be well placed to forecast consumer preferences and behavior.

Persistence

A true metaverse should reflect in real time the changes made in it by different participants, entering and leaving it in different ways, in different places, at different times. When you leave a metaverse environment, it and the other participants will continue their activities uninterrupted, with (for example) smart contracts enforcing agreements and trading assets. This persistence will likely require a new approach to digital activities, with services and applications that are portable, dynamically configurable and extensible.

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5 ways to find metaverse value while building trust

The best way to get ready for what’s coming next from the metaverse is to take advantage of opportunities available today. You can often find value right now, while building the capabilities that can deliver long-term success. Here are five areas to consider:

Engage customers. With the help of generative AI, you can create immersive metaverse spaces and events, where customers can discover and experience your products and services. These experiences can — with appropriate respect for privacy and consent — also offer you new sources of data.

Make operations more efficient. The metaverse can support virtual simulations of manufacturing facilities, store fronts, retail space, supply chains and more. These simulations can help identify improvements, gather and visualize data, assess customer experiences and replace physical activities with lower-cost virtual ones.

Engage and upskill employees. The metaverse’s virtual collaboration spaces and training environments can help you recruit, onboard, train and inspire a workforce that connects seamlessly across geographies and the remote / on-site work divide.

Find new revenue streams. With its immersive experiences, the metaverse offers marketing and sales channels for both existing products and new, metaverse-specific ones — such as virtual consumer goods and metaverse financial services.

Grow trust. In metaverse initiatives, deploy trust-by-design to manage the risks, which include security, identity, data and privacy, and content moderation. The metaverse can also be a force for good: reducing your carbon footprint and enhancing transparency.