The following is a snippet from my book, Not Another Metaverse Book. Collect this post and subscribe for updates!

Welcome aboard the hype train

The year is 2022. Any time a company does something like hire a virtual influencer, release an NFT, or open a virtual world, the media goes nuts. Nike is entering the metaverse. JP Morgan is entering the metaverse. Everyone is in the metaverse right now – why aren’t you??

This isn’t too different from the 1980s when everyone from Purina dog food to electronic companies entered the market. Eventually, too many poor-quality video games (1982 is when E.T., the worst video game of all time, was released on Atari) led to the video game crash of 1983. What led these companies to rush to market? Dunhill electronics didn’t understand the market. Chase the Chuck Wagon didn’t belong.

After the video game crash, only one company remained: Nintendo. By 1990 Nintendo sold nearly 30 million consoles. One in three households owned a Nintendo, and video games became a $5 billion industry (and they gained 90% of the market). Nintendo focused on family-friendly, quality games. But their business practices weren’t so friendly. They created “lockout” chips to keep non-Nintendo developers from reverse engineering their games. They had contracts with developers that their games could only be published on Nintendo. Developers had to make a certain number of games too.

This is kind of similar today. There are lots of experiences, but they can’t talk to each other easily.

Now, virtual reality is part of the larger metaverse ecosystem. But from 2016 to 2020, virtual reality went through a bipolar market. We started out with multiple consumer VR headsets like Oculus Rift, HTC Vive, and Microsoft mixed reality headsets. There were “mobile VR” headsets like Samsung Gear VR and Google Cardboard.

Every year articles would appear, Is the end of VR? VR is Dead. And The year the lights went out for virtual reality. In a similar fashion to Nintendo, one company emerged in consumer VR – Meta with the Meta Quest. However, Developers complain about the Oculus store and the lack of support for Indie VR games. Developers wonder how to get published on Oculus or if it’s worth it since the store takes a 30% cut.

At Metaverse 2.0, Tom Emrich, CEO of The 8th Wall, said, “This year will be the peak hype cycle. Right now, the metaverse is more a mirage than a miracle. The more we get into this, the more we’re going to realize that there’s a lot of work that still needs to be done.”

In order to understand what’s happening, I find it helpful to look at Gartner’s technology hype cycle graph. The metaverse is difficult to put on the graph since it’s a convergence of many different technologies (AI, AR/VR, 5G, blockchain). But the convergence is happening, which I believe puts the metaverse on the Trigger Technology part of the graph.

If Emrich believes 2022 will be the peak hype cycle, that means we’re headed toward the Trough of Disillusionment – and possibly a metaverse crash…

Looking for more?

Check out this talk about Goals, Rules, and Feedback Loops in the metaverse.

Thank you for reading!

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