Research Prospects of CITIC Securities: Future Conjectures and Investment Opportunities of Meta Universe
Facebook changed its name to Meta and turned to Metaverse, which aroused the attention of the capital market. We believe that the ultimate form of the meta-universe will point to the digital survival of human beings and will have a profound impact on society, but it will take a long time. In the past 20 years, the Internet has changed human life and digitized the communication between people; in the next 20 years and beyond, Metaverse will digitize the relationship between people and society. Meta Universe will present a gradual development, with single-point technological innovations constantly appearing and merging, “connecting dots into a line”, and approaching Meta Universe from all aspects of the industry. Just as it is difficult to accurately predict the development of the Internet 20 years ago, we cannot accurately judge the shape of the future meta-universe, but we believe that the ultimate meta-universe may include the following characteristics: 1) three-dimensional immersive experience; 2) digitalization of human and social relations; 3) physical and The digital world meets; 4) Mass user-created content; 5) The value of digital assets appears, etc. At present, global technology giants are successively deploying meta-universe related industries, which are expected to promote the continuous and gradual development of VR/AR, AI, cloud, PUGC game platform, digital human and other fields. In the medium and long term, Meta Universe’s investment opportunities include: GPU, 3D graphics engine, cloud computing and IDC, high-speed wireless communications, Internet and gaming company platforms, digital twin cities, industrial Meta Universe, solar energy and other sustainable energy sources.
From FB.US to MVRS.US: Not only the name change of Facebook, but also the vision of digital survival in 20-30 years
In July, Zuckerberg said on multiple occasions that it is expected that in the next few years, Facebook will transform from a social media company to a meta-universe company. At the Facebook Connect conference on October 28, Zuckerberg announced that the company had changed its name to Meta. In the future, Meta universe would be the first. At the same time, he announced Horizon Home and next-generation VR devices. Zuckerberg said in his speech that Meta sees the “meta universe” as the next frontier of technology, where people will live, work and play, but also admitted that it will take 5 to 10 years to become mainstream. Meta acquired Oculus for $2 billion in 2014. Oculus Quest 2 has been sold since September 2020 and has sold more than 4 million units.
There is no standard definition of the meta-universe: we believe that the meta-universe is the next generation of the Internet in the next 20 years, and the digital survival of mankind in the future.
Metaverse is a series of technologies that “connect dots and lines”, which can bring potential beyond imagination and drive product innovation and business model innovation. The ultimate meta universe will include: Internet, Internet of Things, AR/VR, 3D graphics rendering, AI artificial intelligence, high-performance computing, cloud computing and other technologies. We judge that the ultimate meta-universe still needs great technological progress and industrial innovation, which may not be realized until 20-30 years later. By then, more work and life will be digitized, online time will increase significantly, three-dimensional digital world, and high intelligence The degree of AI, etc. will bring the human digital economy to a high degree of prosperity. The ultimate meta-universe will be the combination of technology and humanities, the experience and efficiency empowerment of technology to people, and the reshaping of economy and society by technology.
Possible features of the ultimate picture of the meta universe: three-dimensional immersive experience, digitalization of human and social relationships, the intersection of physical and digital worlds, massive user creation content, digital asset value manifestation, etc.
1) Metaverse can bring users an immersive Internet experience, from two-dimensional to three-dimensional, from flat vision to richer sensory experience;
2) In the meta-universe, the level of human-computer interaction reaches or surpasses the interactive experience of humans, ranging from “digitalization of social relations” to “digitalization of relations between humans and the world”;
3) The intersection of the physical world and the digital world is getting bigger and bigger, until they overlap or even surpass. Similarly, the digital world will significantly counteract the real world;
4) Internet content from PGC to UGC, Internet companies develop from platform to infrastructure, users are both consumers and producers;
5) Digital assets will not only be the digitization of physical assets in the physical world, but virtual assets that are native to the digital world will also show more value and will generate a greater scale of digital economy.
Global technology giants: Layout of meta-universe related industries
1) Facebook changed its name to Meta to fully shift to Metaverse, and continued to invest in VR/AR terminals, virtual reality platforms, content, etc., to be the most comprehensive metaverse layout;
2) Tencent invested in Epic Games, continued to invest in content and social networking, and deployed a real Internet;
3) Roblox ‘s exploration in the field of PUGC game assets, to realize the economic closed loop of game producers and consumers;
4) NVIDIA Omniverse’s exploration in the field of human-computer interaction vision and an attempt at the GTC conference;
5) ByteDance acquired Pico to expand the VR layout;
6) Apple is highly optimistic about the development of AR and is expected to launch glasses products in the second half of 2022. Global technology giants have successively deployed the meta-universe from various directions and explored possibilities, which is expected to further promote the gradual development of the industry.
Investment opportunities: Advantageous companies have significant advantages in key areas, and multiple links in the industrial chain nurture investment opportunities
Games and social interactions may be the form of user-end products that Metaverse landed in the early days, but in the medium and long term, the areas with the most investment value are expected to remain in key areas where the leading companies have strong technological and market advantages, such as NVIDIA in the GPU field. Graphic engine companies Epic and Unity, etc. VR/AR is expected to compete for the core terminal equipment of Metaverse. It is recommended to pay attention to the hardware foundation and software tool innovation of mobile phones and technology hardware companies such as Facebook, Apple, and Xiaomi. In addition, leading companies in Metaverse infrastructure such as cloud computing, IDC, 5G, and low-orbit satellites have also benefited from the digitization process for a long time, which deserves continuous attention. At the application layer, the first breakthrough we see may come from the explorations of tech giants such as Tencent, ByteDance (Tik Tok), Facebook, and Baidu in the fields of gaming, social networking, and advertising. In addition, Meta Universe needs to find more stable and sustainable energy in the medium and long term for the consumption of electric energy. Tesla solarcity’s exploration in the field of solar energy and energy storage is also worthy of attention.
Metaverse’s early products are often controversial, and the commercialization effect has strong uncertainty; the uncertainty of the policies and supervision of Metaverse countries around the world; AI, graphics engine, high-speed wireless communication and other technologies may affect the yuan The development process of the universe and the related technological process are also uncertain; the transition to PUGC and UGC has brought changes and challenges to the Internet platform; the consumption of electricity in the meta-universe and the digital world requires more sustainable energy and energy storage infrastructure , It also brings challenges to the future energy structure.
At present, there is still a long development path from the ultimate meta-universe, and there are more uncertainties. However, we believe that the meta-universe is the future digital survival of mankind, which will have a profound impact on society and bring great industry ultimate opportunities. In the process of gradual development, we will continue to see the emergence and integration of single-point innovations in all aspects, continue to approach the ultimate meta-universe, and continue to bring investment opportunities. At the current time, it is difficult for us to give the short-term benefit investment targets of Metaverse, but in the medium and long term, we are optimistic about the investment opportunities in related fields such as: NVIDIA, Epic, Unity, Tesla, Tencent, Bytedance , Mihayou, Facebook, Apple, Microsoft, Amazon, Google, Alibaba, Roblox, Baidu, Xiaomi and other companies. At the same time, we have also noticed that in the primary market, there are more young companies innovating and experimenting in related fields. These companies may also enter the capital market in the future and bring investment opportunities.
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