Although the market still has no clear definition of Metaverse so far, this does not prevent it from successfully ranking among the top ten hot words of 2021; and a number of Metaverse concept stocks have stepped out of a booming market.
According to Tonglian Data Datayes! According to statistics, since October 28 (the day when Facebook changed its name to Meta), the Metaverse plate index (880748) has risen from 961.49 points to 1468.42 points on December 31, an increase of 52.72% in about two months. It ranks first among all sector indexes in Shenzhen, Shanghai, and Beijing, and even has a tendency to crush the popular hydrogen energy concept index (19.16%) in the same period.
In the same period, the growth of individual stocks in the sector is also very gratifying, Chinese Online (300364.SZ), Hengxin Dongfang (300081.SZ), Fengshang Culture (300860.SZ), Blue Focus (300058.SZ) and New Cape (300248.SZ). SZ) and other 5 stocks successfully doubled, and more than 35 stocks rose more than 30%.
However, behind the prosperity of the first year of the development of the Metaverse, there are constant controversies: from the listing of the first Roblox stock of the Metaverse, to the change of Facebook’s name to Meta, the release of the enterprise Metaverse by Microsoft, to the release of the Metaverse platform by Baidu, and 360 turning around to embrace Yuan. The establishment of the Universe and the Metaverse Association, and various industries have been discussing the Metaverse continuously, and differences in understanding have become increasingly fierce due to different understandings.
So, what are the differences in the market? And how will the Metaverse, which has passed through the first year of development amidst the differences, be interpreted in 2022?
Controversy 1. Pure concept hype or next-generation Internet
At the end of the year, news about Metaverse has flooded in. For example, Shanghai has announced that it will strengthen the forward-looking research and development of the underlying core technology and capabilities of Metaverse, and Metaverse has become a Christmas winner, Meta VR application topped the Apple US App Store, etc. All seem to confirm that “the end of the Internet is the Metaverse.” But at the same time, negative news is also endless. For example, the first case of sexual harassment on Facebook Metauniverse, Ren Zeping accused Metauniverse, and Musk, the “trendy guy” in the science and technology field, continuously bombarded Metauniverse, directing it as a marketing hype.
Looking back at 2021 (the first year of the Metaverse), the market’s perception of the new thing of the Metaverse has shown two extremes, and even fragmentation, which is extremely rare in the history of science and technology in recent decades (whether it was the Internet or mobile This phenomenon has never appeared before the emergence of the Internet). What causes the two extreme cognitions of the metaverse by the general public?
In this regard, Wang Min, a senior industry research expert from Tonglian Data, replied in an interview with a reporter from Economic Observation Network that in fact, any new things that appear, more or less will experience these similar situations, including the Internet, blockchain, etc., maybe just The form and degree are different. For Metaverse, on the one hand, it seems to have suddenly become hot. The essential reason is that the development of information technology has the conditions to gradually implement the grand Metaverse vision. VR/AR equipment hardware and game products have gradually matured, and the penetration rate And the increase in exposure rate is the starting point for this round of Metaverse to receive widespread attention, and it is even more popular in the context of the announcement of new strategies for the deployment of Metaverse by manufacturers at home and abroad.
On the other hand, at present, there is no consensus on the definition and application of the Metaverse. Everyone talks about the “Metaverse”, and everything seems to be a “Metaverse”, but what exactly is a “Metaverse” and what application scenarios are there? People may have different opinions on the value and value, and it is still in the exploratory stage in theory and practice. Especially after experiencing the upsurge of the Internet and blockchain, it is inevitable that the attitude will be more cautious.
Li Zhan, chief economist of the Research Department of China Merchants Fund, told reporters that the extreme cognition may be due to the rapid outbreak of the Metaverse concept, which was born in the era of epidemics where demand has been suppressed for a long time, and the public is not very familiar with this concept. Understanding and unimaginable, but eager to keep up with the trend, so in a short period of time to make more extreme subjective judgments.
Li Zhan further pointed out that, in fact, the concept of Metaverse is not new and can be traced back to the science fiction novel “Avalanche” in 1992. The rapid development of information technology in the past few decades has allowed people to see the feasibility of the Metaverse. There are also many literary works, audio-visual works, and game works depicting how virtual reality blends with reality. In the long run, Metaverse may become reality. . However, without major technological breakthroughs, the rise of this round of Metaverse concepts appears to be very rapid and sudden. It may be catalyzed by two factors: on the one hand, everyone’s understanding of digital life and online life during the epidemic and Acceptance has increased significantly; on the other hand, liquidity has increased in the context of global easing, and capital has the need to find new investment outlets.
He believes that there is still a lot of uncertainty between short-term conceptualization and long-term realization. One is the uncertainty of technology. How long will it take for information technology to support such a grand concept, and to what extent will it eventually be realized? The second is the uncertainty of the content. Metaverse is trying to reproduce the complex real world, whether there will be moral and legal issues in it, and how will it affect people’s real life.
“These uncertainties require many explorations to know the answer. However, under the epidemic, public demand has been suppressed for a long time. Metaverse has given everyone the hope of releasing demand. The enthusiasm for chasing the trend is high, and there is not much time for observation and thinking. In addition, in the early stage of the development of the Metaverse, there were indeed frequent chaos and mixed development of fish and dragons. Therefore, the public may make more extreme and differentiated judgments in a short period of time. The answer will be given after the popularity has dropped slightly and everyone has fully studied and thought. It may be more dialectical and objective,” Li Zhan said.
Cao Yuan, the co-founder and director of Probe Group, tried to explain the reasons for the extreme cognition of the metaverse from a philosophical point of view. In an interview with a reporter from Economic Observation Network, he said that from the perspective of human cognition of the world, this kind of polarization, contradiction, and even struggle are very common. For example, the dispute between Confucianism and Legalism; the dispute between monotheism and polytheism; the dispute between evolution and creationism; the dispute between geocentric theory and heliocentric theory; the dispute between communism and capitalism. Even very talented scientists will be tit-for-tat, such as the debate between the Copenhagen School and the Einstein School in quantum mechanics; the debate between the Big Bang and the circular universe in the Standard Model of the Universe.
From the perspective of materialism, contradictions are opposed and unified, and these disputes constitute the real world.Controversy can be big or small, long and short, fierce and relatively moderate. The current debate on the Metaverse is still in the stage of rational discussion.
The reason why we feel that everyone’s cognition of the Metaverse has become more fragmented than that of the Internet or the mobile Internet, because the Metaverse is a more complex system, and the discreteness of cognition can be very strong. In fact, the aforementioned large-scale historical controversies are all like this, and they are all views on the world structure. On the other hand, the Internet and the mobile Internet are small systems, and the boundaries are relatively easy to define. “For example, throw a pile of table tennis balls into a container. If the container is relatively small, the table tennis balls will be relatively concentrated. If the container is relatively large, they will be scattered. The easternmost and westernmost individuals will gather farther together. It is building a world. It, the standard model of the universe, and the various doctrines of social development belong to a more complex and systematic discussion. It is relatively normal to have extreme views,” said Cao Yuan.
He emphasized that the current rational debate of the Metaverse is actually conducive to promoting social progress, and even the development of the Metaverse. For example, Ren Zeping said that Metaverse will cause the marriage rate and fertility rate to drop. Then those who support Metaverse will think about how to solve this problem. Digital marriage may appear, and artificial breeding and social support may keep up.
If extreme cognition is normal, then, as a vocabulary that will explode in the world in 2021, is Metaverse really a pure conceptual hype (or even a scam) as Musk said, or is it a big opportunity in the history of human science and technology?
In this regard, Cao Yuan gave a wave-particle duality answer, “It must be hype at the moment, but it must also be an opportunity.” Why is it hype, because it has not been realized on a large scale, and the ability to create value is far from enough to support the high valuation given by the market.
“The hype is good and bad for the development of the industry. I am very worried that the hype of Metaverse will move from the advantages outweigh the disadvantages to the more harm than good.” Slow or dead, and when there is hype, it will attract people who understand this new thing to invest resources in the construction of the new thing, and promote the rapid development of the new thing. The so-called stage of more harm than good refers to the people who participate in the hype. From the people who understand this new thing, it spreads to the people who don’t understand, and even blindly follow the trend. It is usually said that “Auntie is involved” is the stage where the harm outweighs the benefit.
He further pointed out that the current hype stage of the “Metaverse” is still at a stage where the advantages outweigh the disadvantages. Including Netease Hainan’s establishment of the Metaverse Base, Baidu’s first such as the Metaverse Conference, etc., are all involved in the construction of institutions that understand “Metaverse”, and the Metaverse concept stocks in the stock market are relatively well-founded. The “Chinese Aunt” hasn’t had a short talk about the universe, and hasn’t flocked to Decentraland to speculate on the land. However, if we continue to develop, when “everything can be Metaverse”, when the concept of Metaverse is soaked into the sky, it will do more harm than good. Like other technological concepts, Metaverse will also develop along Gartner’s technological maturity route. According to Gartner’s judgment, Metaverse will be relatively mature only after 8 years, so ordinary investors have to be cautious, and this 8 years is still uncertain. What will happen? The company that has joined the Metaverse now may not still exist in 8 years.
So why do you say it is an opportunity? Cao Yuan said there are two main reasons. The first reason is that Metaverse is a market with a lot of imagination. The Bloomberg industry research report predicts that Metaverse will reach a market size of US$800 billion in 2024, and PricewaterhouseCoopers predicts that the market size of Metaverse will reach US$1.5 trillion in 2030. Not to mention the accuracy of the numbers, research institutions generally give relatively high estimates of the market value of Metaverse. In fact, there are not many global industry opportunities that exceed trillions of dollars. “
“I personally estimate that the market of Metaverse will be more optimistic. It includes not only the market scale for building Metaverse, but also the scale of the market created by Metaverse itself. Based on Metaverse’s new communication and collaboration methods, the original It’s impossible to connect objects that are connected together.” Cao Yuan further explained. For example, it’s impossible for a person to go to Hawaii in a lifetime, but he went to Hawaii through the facilities of Metaverse, experienced travel in Hawaii, and bought souvenirs from Hawaii. , Souvenirs may be digital NFTs or physical assets; for example, a person with a serious illness has no chance to meet the world’s top doctors for consultation, but in the Metaverse, the world’s top doctors can help him consultation. This change in human survival paradigm connects more affairs, and the value created may be greater than the value created by the known world.
The second reason given by Cao Yuan is that Internet 2.0 has entered a slow growth zone. It can be observed that the growth rate of large Internet companies has declined, and China and the United States are no exception; the survival of startups is even more difficult, and China and the United States are no exception. The marginal benefits that can be generated by iterative optimization of the original Internet paradigm are getting smaller and smaller. Behind this is the decline in the growth rate of the Internet population. Since 2010, the global Internet industry has entered a period of rapid development. According to Internet World Statistics (IWS) data, as of June 2020 (May 31), the number of global Internet users reached 4.648 billion, accounting for 59.6% of the world’s population.
“The application of a technology is a period of rapid growth in the penetration rate of 20%-50%. If the user penetration rate is 50%, it will enter the deceleration process, and if the penetration rate exceeds 70%, it will enter an extremely slow growth or stagnation. It is conservative. In this context, the penetration rate of 50%-60% can be regarded as an invisible ceiling. In other words, Internet 2.0 has entered the invisible ceiling.” Cao Yuan said that in this context, whether it is a large factory or a startup company , They all hope that there will be a new space to develop, and the Metaverse has given them opportunities.
But he emphasized, “However, even if it is an opportunity, we must also consider risks. China’s Metaverse and Western Metaverse may have different development routes. Even the final name is not the same. China’s Metaverse pays more attention to digitalization. The construction of the digital world is the mapping of the physical world to the digital world. In turn, the digital world can promote the development of the physical world, and industry may become the main driving force. The Western Metaverse pays more attention to the gameplay of the digital world, and the community becomes the main driving force. Therefore, Western investment logic may not be applicable to China.”
Controversy two, is it reliable to speculate in real estate and currency in Metaverse?
With the popularity of Metaverse, some virtual currency, virtual real estate and even virtual land projects on the Metaverse platform have all appeared in pursuit of popularity. There have even been hundreds of thousands or even millions of dollars in transactions abroad, with prices approaching. Housing prices in China’s first-tier cities. As investors, how should we view and treat the phenomenon of “real estate speculation and currency speculation” in Metaverse? Also, for ordinary people, what impact and changes will the realization of the Metaverse bring to everyone?
In this regard, Wang Min said that Metaverse is expected to bring revolutionary changes to our social life and lifestyle. In the era of mobile Internet, social networking sites have established a connection between people. In the next era, with the support of 5G, AI and other basic technologies and hardware products, the connection medium will undergo revolutionary changes. Through VR/AR devices, connections will be established in the virtual world, and the dimensions will not be limited to communication and exchanges. The period will migrate various scenes from the real world to the virtual world, which will profoundly affect our social life and lifestyle.
At the same time, Wang Min emphasized that things that violate laws and regulations and are subject to supervision will not be different because they occur in the physical world or in the virtual world. Metaverse should be closely linked with the industry, serving and empowering the development of the industry. The future development direction of Metaverse is closely related to the rapid progress of related industries, including 5G/6G networks, cloud computing, edge computing, etc. It also includes computer vision, deep learning and other AI industries, video game industries, interactive hardware, blockchain industries, etc. , The global Metaverse market may reach the trillion-dollar level in the future, and the space is huge.
Li Zhan believes that ordinary people can entertain, socialize, and work in the metaverse. The experience of virtual life may be better than that of real life, spiritual needs will be met, and people may allocate more and more time to on-line. Real life will also be affected to varying degrees, including the influence of wealth in reality through digital asset transactions, and the expansion of social circles in reality through activities in the virtual world.
“It is a normal phenomenon of overheating for real estate speculation in Metaverse. It is very common for some capital to rush out of the layout and some consumers with purchasing power to try early.” Li Zhan said, but the development of Metaverse will be relatively long. Especially the in-depth and all-round simulation of real life, even subject to moral and legal constraints, the current infrastructure and market audiences are still relatively lacking. Therefore, the persistence of this kind of hype will not be too strong, and asset prices may face big ups and downs.
Cao Yuan pointed out that the current real estate and currency speculation of Metaverse are mostly in the crypto circle, which is still in the exploratory stage. “As I said before, the uncertainty of the development of Metaverse, the challenges it faces, and the time it takes for the technology to mature is very long. Those who don’t understand or have low risk tolerance are not suitable to participate. I hope not to see the’Chinese Auntie’. Admission information”.
Outlook 2022: Profit Model and Prospects
Although Metaverse is one of the hottest outlets in 2021, it does not seem to have a clear profit model so far. Looking to the future, what will be the development trend of Metaverse?
In this regard, Li Zhan believes that the overall development of the Metaverse may go through three stages . The first stage is the rise of concepts, the entry of capital, and the emergence of large-scale related concept companies.According to current trends, this stage may continue for some time. In the second stage, technology began to develop and iterate under the promotion of the market and capital . Companies with real materials slowly emerged, some branches of Metaverse gradually became reality, and the infrastructure of Metaverse World gradually spread. The third stage is that after a long period of technological development, regulatory development, and market development, Metaverse has become a relatively mature industry.
“From the perspective of the development order of the branches, the game may be the first Metaverse track to develop, because recreational entertainment and virtual reality are naturally more compatible, the market demand will be stronger, and the profit model is more likely to run through.” Li Zhan It is further stated that the second track of development may be leisure activities such as watching movies and shopping. These activities are not technically difficult to make online, and the realization path is relatively straightforward, but it takes a certain amount of time for consumer education and market penetration. The full-scale social universe may develop more slowly, with both technical constraints as well as moral and legal constraints.
Wang Min said that the essence of Metaverse is the revolutionary change of the connected media with the support of 5G, AI and other information technology and hardware products. In the long term, it will migrate various scenes from the real world to the virtual world. Full implementation is a relatively long-term vision, but the trend is certain. “We believe that the virtual world will once again greatly improve the production efficiency of various industries from the interaction and connection level. The introduction of the virtual world in social life does not mean that humans will be divorced from reality. The improvement of production efficiency will provide more creative work with extra energy and energy. time.”
He emphasized that at the industrial level, Metaverse will bring 5G/6G networks, cloud computing, computer vision, machine learning, video games, sensor technology, blockchain and other extensive technology iterative upgrades, as well as bring similar Internet+ Extensive upgrade opportunities in various industries will also bring more contributions to technology and economic life.
After the first year of development amidst controversy, how should we lay out the outlet of the Metaverse in 2022? In other words, among the related conceptual sub-sectors of Metaverse (AR/VR technology, AI artificial intelligence, blockchain, NTF, Web3.0 technology, etc.), which ones benefit first? Which ones are most worthy of attention?
In Li Zhan’s eyes, the revenue logic of the AR/VR sector is relatively straightforward. “Because they are the physical basis for consumers to participate in the Metaverse, they are an important support for the transformation of the Metaverse from 0 to 1. Universe, get richer gaming, shopping, audio and video experience.” In addition, Li Zhan believes that 5G/6G, edge computing, AI artificial intelligence and other sectors related to computing power and computing speed also have better development prospects because of these technologies. The development directly affects the experience of the participants in the Metaverse. “The development of blockchain, NTF and other sectors is also worth looking forward to, but the cycle may be longer. These are the underlying technologies for the generation, dissemination and realization of the content of the metaverse, which determine the ultimate stability and quality of the metaverse, and it will develop in the market. After a certain degree, it will become a decisive factor in determining whether Metaverse can truly retain consumers for a long time.”
Wang Min believes that investment opportunities are not limited to the network infrastructure supporting the development of Metaverse in the technology industry, including 5G/6G networks, cloud computing, edge computing, etc., but also widely including computer vision, machine learning, NLP and other AI industries; game engines, games Electronic game industries such as production and distribution; industries that support interaction such as sensing, brain-computer interaction, MR/AR/VR, and blockchain industries that can support the virtual world credit system, etc., even with related industries in the Metaverse scene The application of, will bring a wide range of upgrade opportunities in various industries similar to Internet +.
“The concept of Metaverse is ambitious, and the development stage is also at an early stage. We believe that it will take a long time to enter the mature stage of development, and the period will also be limited by relevant software and hardware technologies and even include data security, ethics, policy environment and other factors.”; Wang Min said that from an investment perspective, it is recommended to observe the products or scenarios that Metaverse can land in the near future from multiple perspectives such as the maturity of related technologies and the feasibility of industry applications. As the overall trend gradually matures, investment opportunities should be grasped in stages.