A comprehensive vision of the metaverse

Presented by Connected Commerce Council: How the next wave of technology is upending the global economy and its power structures

Jul 20, 2022 View in browser   By Derek Robertson Presented by Connected Commerce Council A conference-goer wears a virtual reality headset. | Getty Images The subtitle of Matthew Ball's new book "The Metaverse" makes a bold claim: "It Will Revolutionize Everything." But the insight Ball, a venture capitalist and former Amazon executive, has to offer has less to do with proving that revolution is coming than in providing an overdue, comprehensive explanation of how it will happen. The book expands on his " metaverse primer ," a series of essays published last summer (ahead of Meta's big rebrand, it should be noted) that explore the technological changes that will characterize, and are necessary to create, a fully immersive 3D internet. I called Ball this week to talk about misconceptions around what the metaverse actually is, why the world's biggest corporations — and Ball himself — are investing so much money in it, and what role real-world regulators might play in shaping said "revolution" in the digital one. An edited version of our conversation follows: What inspired you to write the "Metaverse Primer," and why do you think it's important for people outside the industry to understand this technology? My experiences with Fortnite and Roblox in 2018 led me to believe that it was starting to become a practical business opportunity. I learned a ton in three years about these hard problems that are of extraordinary significance to the global economy, whether you believe in the metaverse or not — around what networks can do and the problems that computing processors can solve, and will be able to solve.So I just decided to formalize that into the primer. One of the challenges with articulating the metaverse right now is it's most commonly described like "Ready Player One," which feels a lot like how we talked about the internet as the World Wide Web or an "information superhighway." It's inadequate, and leads us to dramatically underestimate its significance. Seven of the 11 largest companies on Earth, the big five tech companies plus Nvidia and Tencent, are committing their businesses, their organizational models, their capital spending and their product lines to this. It's easy to discount it because it feels like a game; it's easy to discount it because no one can say exactly what the future is going to look like. But I wouldn't underestimate how seriously the largest and most capitalized companies on Earth are taking this, partly because they have learned from the shift from mainframe to personal computers, and from personal computers to mobile and cloud, that the laggards get displaced. What is the incentive for these massive, highly competitive corporations to actually build a system that is "interoperable?" The world economy becomes more open each year. We see greater mobility of goods, of people, of capital, and we conform to a growing share of standards: Metric, USD, English, the intermodal shipping container. That also reveals how there's never one standard, there are often many different standards. When it comes to the metaverse, we expect similar advances with the utility of combining different communications protocols, allowing virtual assets to be more easily repurposed from one environment to another, and allowing the economy to span not just one experience which may be a flash in the pan. That will be essential to increasing consumer spending and business investment, and we're already starting to see interoperability grow. Two weeks ago the Metaverse Standards Forum was established, with Microsoft, Meta, and [graphics company] Unity and ["Fortnite" developer] Epic, most wireless technology providers, and now they have close to a thousand other signatories. What role do regulators have to play in the development of those standards? One is ensuring the market is open, so that any participant can pursue the business models, technologies and experiences they want, rather than be stymied by a competitor who doesn't. In South Korea the Ministry of ICT has established the South Korean Metaverse Alliance, which brings together nearly 500 companies from refrigerator manufacturers, to banks, gaming services and automotive companies to try and directly foster interoperability. The individual company will be occasionally adversely affected, but the national investment and national metaverse ecosystem should be stronger — and there's an implicit bet that taking a stronger hand will provide a leg up versus Western companies, which often struggle to partner in ways that weaken them individually.Most people have come to believe that regulatory actions were insufficient leading to too many unintended consequences over the last 15 years. It's my perspective that a stronger hand in shaping the future — not just in the standards, but setting different expectations around moderation, toxicity, radicalization — is important as the metaverse grows and time spent online becomes more important than it is today. Its cultural impact is going to be greater, so I think that there's an onus on government to be more involved, and more proactive than reactive as has been the case for the past decade. A message from Connected Commerce Council: Small businesses face big consequences from overregulating tech. By breaking up integrated services, it gets harder and more expensive for smaller shops to reach customers. That's why 87% of small businesses are concerned that antitrust legislation is going to make digital tools more expensive and less useful. Say yes to supporting small business success. Vote NO on the American Innovation and Choice Online Act (S.2992).   playing catch-up The stated rationale for the research funding in the CHIPS bill making its way through Congress is that tech innovation isn't just a virtue in its own right, but a pillar of global competitiveness. And while U.S. politicians fear losing our global edge, Europe is tired of lagging behind. As POLITICO's Louis Westendarp reports from Europe, a German-led group of corporations and universities is banding together to give a boost to what they call Large European AI Models . Their goal is to build a supercomputer that could power an AI model that might, if not surpass, at least hang in the top 10 with the Chinese and American systems that handle hundreds, if not billions, of parameters . The push comes as the European Union negotiates sweeping AI regulation , and is making its own push for " deep tech " innovation that would include AI funding. Still, that's not quite fast enough for the LEAM project's German backers. Philipp Slusallek, professor at the University of Saarland and founder of the European AI organization Claire, told Louis that although the future supercomputer should be open to research for all Europeans, the push has to "start on the German side because it takes far too long at the European level." afternoon snack Are you smarter than an artificial intelligence (that's been trained on a voluminous amount of the texts of one of the foremost modern philosophers of the mind)? A group of philosophers led by the University of California-Riverside's Eric Schwitzgebel recently posed that question to all comers, running a public experiment where they trained OpenAI's GPT-3 large language model on the works of Daniel Dennett , whose work at the intersection of philosophy and cognitive science has frequently addressed artificial intelligence. They then posed a series of philosophical questions both to the AI and Dennett himself, and formulated a quiz where the unlabeled answers are presented to the user, who is then asked to distinguish real from fake. The questions include some fundamental philosophical problems, such as "What is the 'self?'" and "What implications does evolution have for our understanding of morality?" One question even asked for Dennett/GPT-3's impression of the work of David Chalmers, whose book "Reality+: Virtual Worlds and the Problems of Philosophy" we covered in DFD earlier this summer . You can still take the quiz — but the study is now officially closed as Schwitzgebel and company have collected enough answers to begin academic analysis, so if you want to check your philosophical chops or AI-detecting instincts you'll have to email the researchers directly for your results. (Full disclosure: I only got four out of ten.)   A message from Connected Commerce Council:   the future in 5 links Elizabeth Warren and other senators are asking the EPA to specifically regulate crypto mining . For its next AR device, Google would rather not inspire a massive public backlash . An art company is suing Meta for allegedly stealing its name . South Korea is investigating potential crypto-linked money laundering at some of its biggest banks. Amid the crypto swoon, Anthony Scaramucci is suffering too . Stay in touch with the whole team: Ben Schreckinger ( bschreckinger@politico.com ); Derek Robertson ( drobertson@politico.com ); Konstantin Kakaes ( kkakaes@politico.com ); and Heidi Vogt ( hvogt@politico.com ). Follow us on Twitter  @DigitalFuture . If you've had this newsletter forwarded to you, you can  sign up here . And read  our mission statement here . A message from Connected Commerce Council: Small businesses run on tech. Integrated digital tools help Frank DiCarlantonio at Scaffidi's Restaurant reach customers, scale up, and compete. In fact, 75% of small business leaders say digital tools are important to their operations. But Congress is aiming to break up the digital tools and services that small businesses rely on—making them more expensive and harder to access. It could be the difference between success and closing their doors for good. Don't forget about small businesses. Vote NO on the American Innovation and Choice Online Act (S.2992).     Invitation – Bold Leadership and Innovation Event Thursday:  America's tech sector is built on the hard work, ingenuity, and innovation of a melting pot of cultures. The American dream is a MerITocracy. At MerITocracy 2022: American Innovation Forum on Thursday the Hill, the Administration, and industry leaders will clear a path forward for tech in education, workforce, global competitiveness, security, and citizen services. Located at the crossroads of tech advances and the future of American democracy, the conference brings together bi-partisan and bi-cameral policy leaders and industry innovators to focus on creative thinking at the nexus of policy and technology. Save your seat here.       Follow us on Twitter Ben Schreckinger @SchreckReports Derek Robertson @afternoondelete Konstantin Kakaes @kkakaes Heidi Vogt @HeidiVogt   Follow us

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