September 7, 2022

Book Review: The Metaverse and How it will Revolutionize Everything by Matthew Ball

By Elizabeth Haas

I began reading and often re-reading  Matthew Ball’s blogs  (originally focused on e-sports) in 2019. Ball first emailed me about his book on the metaverse almost a year before it was released. My anticipation was high and I was not disappointed. Mainstream media — Time, WSJ, Forbes wrote about the book. Multiple friends and clients, who have watched my obsession with the metaverse and were not engaged in it, read the book and called or texted me to say, "It is so interesting. I finally get it…"  The book has clearly impacted many people.

The Inevitability of the Metaverse
According to Ball, "History not only shows a multi-decade progression towards the metaverse, but also reveals more about its nature. These would-be metaverses have not been centered on subjugation or profiteering but on collaboration, creativity, and self-expression."

Ball argues that the metaverse is real and it is coming. He richly frames the metaverse against a multi-decade history – beginning with Vannevar Bush leading a precursor to NASA and convincing President Roosevelt to establish the Office of Scientific Research and Development and subsequently The National Science Foundation. Ball then dives into the history of the personal computer, the internet, cable, mobile phones, streaming, games, and virtual and augmented reality.

He weaves in behavior with the technology and emphasizes the lessons in setting the stage for the next great step for the internet. As he puts it, "Humans seek out digital models that most closely represent the world as they experience it." As our online experiences become more "real," we live more of our lives online, and human culture overall becomes more affected by the online world. The leading indicator for this change is typically new social apps, embraced by younger generations.

The Role of Gaming
Ball writes, "Gaming, a $180 billion leisure industry, is poised to alter the $95 trillion world economy."

Ball highlights the constraints of rendering real-time 3D virtual worlds and simulations. He then notes that video games “don’t need realistic fire, gravity, or thermodynamics. What they need is fun.” The tradeoffs that gaming companies face are fascinating to read about (including how Fortnite served some 30 million players during Travis Scott’s 10-minute event).  Ball also emphasizes that for decades, the most technically capable devices in most households were a video game console or a gaming-focused PC.

It is not just the tradeoffs that matter, it is also the technology that was unblocked. Ball quotes Jensen Huang, CEO of Nvidia (the leading graphics-based computing company), "The condition is extremely rare that a market is simultaneously large and technologically demanding. It is usually the case that the markets that require really powerful computers are very small in size and can’t afford very large investments. That’s why you don’t see a company that was founded to do climate research. Video games were one of the best strategic decisions we ever made." Similar gains are described with AI latency management and community building — all necessary for the metaverse.

The Absolute Power of the Capabilities of the Metaverse
"Metaverse means an ever-growing share of our lives, labor, leisure, time, wealth, happiness, and relationships will be spent inside virtual worlds," opines Ball.

With the stage set, Ball clearly defines the metaverse, from which we can understand its power. He defines it as "a massively scaled and interoperable network of real-time rendered 3D virtual worlds that can be experienced synchronously and persistently by an effectively unlimited number of users with an individual sense of presence, and with continuity of data, such as identity, history, entitlements, objects, communications, and payments."

This is an aspirational definition — it doesn’t say whether it will have VR. In fact, Ball believes VR will be secondary and present itself through devices we are already using.  He highlights games like Fortnite, which offers users sufficient presence.

Ball declares blockchains are important for both establishing an independent registry for virtual goods and a solution to interoperability. Although blockchain is not in the definition, Ball believes what is critical about blockchain is its programmable payment rails. These programmable rails create a "self-sustaining system through which a blockchain can increase capacity while decreasing cost and improving security."

The power of blockchain is demonstrated by what happened in 2021 — $16 trillion of transactions used these rails without a central authority across dozens of wallets, and $4 billion in venture investment went into blockchain-based games and gaming platforms. Ball describes the talent, investment, and experimentation as a flywheel increasing the value and utility of blockchain products.

He is hopeful that blockchains will not be used for storing data but remain key to many applications.  He quotes Chris Dixon, from Andreesen Horowitz, who argues that if the dominant ethos of Web 2.0 was "don’t be evil," the dominant ethos of Web3 is "can’t be evil." Throughout the book, Ball sprinkles eyebrow-raising examples such as:

"Comparing surgery with AR to surgery without it is like comparing driving with GPS to driving without it — its use depends on whether it has a meaningful outcome (e.g. shorter driving time). For surgery, this means a higher success rate, faster recovery time, or lower cost."

Think of the Uber driver finding you if you are outside, and compare it to the driver knowing what room and what floor you are in, who is with you, how your irises are moving, etc. You will get a sense of the power of 3D over 2D.

The Battle Tech Companies are Fighting for Control 
Ball then discusses what players in the industry are doing. "It is rare that the world’s largest companies publicly reorient themselves around such ideas at such an early stage — on the basis of realizing their most ambitious visions."

He quotes Tim Sweeny, CEO of Epic Games, "If one central company gains control of the metaverse, it will become more powerful than any government and be a god on Earth.” Jensen Huang, Nvidia’s CEO said, “The economy in the metaverse…will be larger than the economy in the physical world."

Given the power and transformation of the metaverse, it is no surprise that mainstream players are fighting for control. The clarity with which Ball presents this reality may be my favorite part of the book.

Giants like Amazon and Apple will benefit from the migration. As Ball puts it, "Apple’s hardware, operating system, and app platform will remain a key gateway to the virtual world… and amplify its influence over technical standards and business models." Apple is also well positioned to launch lightweight headsets and integrate with its iPhone. They are unlikely to touch the gaming or software side, however. Amazon Web Services is well positioned to service the increased data storage and processing needs, although their efforts to build metaverse-specific content and services have been universally unsuccessful and not prioritized.  it is possible they will invest here at some time.

Ball describes Facebook as the most aggressive investor in the metaverse and vulnerable to blocks from hardware-based platforms and its own reputation. He maintains that the core of Facebook’s metaverse strategy is not Oculus, nor VR and AR, but the Roblox and Fortnite-like Horizon Worlds integrated virtual-world platform (built on Unity).

Ball ends the discussion reminding us, "We know some of these companies will falter…An entire generation of Roblox-natives is only now on the cusp of adulthood, and it is likely that they, not Silicon Valley, will create the first great game that has thousands of concurrent users."

The Revolution We Should Expect
Ball forecasts that "The metaverse presents an opportunity not just for users, developers, and platforms, but for new rules, standards, and governing bodies, as well as new expectations for those governing bodies…My great hope for the metaverse is that it will produce a ‘race to trust.'"

Ball indicates that we now have a critical mass of working pieces. He writes, "Something is happening," and then quotes Tim Sweeny, "Epic games has had metaverse aspirations for a very, very long time…But only in recent years have a critical mass of working pieces started coming together rapidly." Ball defines the next drivers of growth as 1) underlying technologies that are improving continuously, and 2) a generational change — with 75% of children playing on Roblox and 140 million more gamers born each year. 

Ball argues that the metaverse will first disrupt sectors like education, lifestyle, entertainment, sex work, fashion, and advertising, and then move into industry and enterprise.

Throughout the book, issues related to governance and standards are raised.  In fact, my favorite sentence in the book is, "Trust matters more than ever."

Matthew Ball’s book, The Metaverse, frames what we are seeing today in the rich 48-year history of the internet.  He is optimistic about the metaverse, and clear in defining and describing the technology that doesn’t sacrifice complexity. He does not try to predict or answer questions that are uncertain, instead shares what he is certain about — the metaverse is tomorrow. 

Appendix: Matthew Ball Definitions:

Blockchains: Databases managed by a decentralized network of "validators."

Digital twin: Stylistically, virtual worlds can reproduce the “real world” exactly.

Metaverse: A massively scaled and interoperable network of real-time rendered 3D virtual worlds that can be experienced synchronously and persistently by an effectively unlimited number of users with an individual sense of presence, and with continuity of data, such as identity, history, entitlements, objects, communications, and payments.

Virtual worlds: Any computer-generated simulated environment. These environments can be immersive 3D, 2.5D (also known as isometric 3D), 2D, layered atop the “real world” via augmented reality, or purely text-based as in the game-like multi-user dungeons (MUDs) and non-game like multi-user shared hallucinations (MUSHs) of the 1970s.

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