Tech companies aiming to build the new virtual communities known as metaverses will first have to master all aspects of videogaming and potentially pursue acquisitions, according to Michael Wolf, co-founder and chief executive of consulting firm Activate Inc.
Metaverses are emerging as possibly the next dominant innovation altering how people interact online and in person, and “videogames are morphing into metaverse platforms,” Mr. Wolf said Wednesday at The Wall Street Journal’s Tech Live conference.
“It will fundamentally change the way people interact with each other,” he said. “Everything you can do in the digital and virtual worlds…you will be able to do inside of gaming.”
The metaverse—a concept rooted in science-fiction novels like “Snow Crash” and “Ready Player One”—refers to an extensive online world that is tied to several tech platforms, not just one. People will be able to hang out in immersive, shared digital spaces using avatars that allow them to virtually attend concerts or try on clothes in stores, just like they would do offline in the real world.
Major tech companies including Facebook Inc., Microsoft Corp. , and others have spoken publicly about their ideas for the metaverse. Many of them also have growing gaming operations.
Mr. Wolf said companies would likely need to make additional moves to round out their gaming content on their path to the metaverse. “We expect the technology giants are going to pursue acquisitions of the top gaming companies,” he said.
Facebook in 2019 agreed to acquire PlayGiga, a company in Madrid that specializes in cloud-based gaming. Microsoft was previously in talks to buy chat startup Discord Inc., popular with gamers, before the discussion was halted. The software giant has done several gaming deals, closing its $7.5 billion purchase of videogame company ZeniMax Media Inc. earlier this year.
Mr. Wolf predicts a competitive future of metaverses. “There’s not going to be one big metaverse or one big platform,” he said. “The metaverse is going to be for everyone.”
Other forecasts from Mr. Wolf’s presentation:
• Time spent watching digital videos will increase over the next four years and surpass time spent watching television by 2025. The average number of paid video-streaming services individuals subscribe to is expected to increase to 5.8 in 2025, up from 1.6 nearly a decade earlier.
• The shift to e-commerce will accelerate as more car buying moves online. In 2025, up to 10 million cars will be purchased online, from around 850,000 this year. Online car sales will top $150 billion in 2025.
• Audio will be one of the fastest-growing media formats with users estimated to spend nearly three hours a day listening to either podcasts or radio by 2025, up from 2½ hours in 2018. Podcast audiences will grow from 95 million monthly users in 2019 to an estimated 166 million in 2025.
• The global audience for esports is expected to surpass 700 million viewers by 2025. The projected viewers for 2021 is 557 million. Esports revenue will also grow from an estimated $3.1 billion this year to $5 billion by 2025.
• Nonfungible token sales—the virtual deeds, conveying ownership of a digital asset—have exploded in popularity. Sales jumped from less than $1 billion in 2020 to an estimated $8.1 billion by the end of this year with further growth expected as more companies offer NFTs.
• The global videogaming industry is expected to reach $221 billion in 2025, more than doubling in size from just eight years earlier.
Write to Meghan Bobrowsky at [email protected]
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Appeared in the October 21, 2021, print edition as ‘Activate Chief Outlines Metaverse Criteria.’
