Welcome to Apple in the Metaverse…but which side will it take in the battle of lines?

Welcome to the WeChat subscription number of “Sina Technology”: techsina

Author | Pei Pei, Head of the Phantom Thieves

Source | Internet Phantom Thieves (ID: TMTphantom)

According to Bloomberg, in mid-May 2022, Apple demonstrated to its board members a Mixed Reality (MR) headset being tested. At the same time, Apple has accelerated the development of rOS (reality OS, “reality operating system”), which will be used in mixed reality hardware devices. Although Apple has not officially stated its position, Bloomberg estimates that the product is likely to meet the conditions for public release within a few quarters.

If the above report is true, it will be the first time Apple has opened a new product line since the release of the Apple Watch in 2015. This will also mean that Apple will officially join the “metaverse” battle after Meta (Facebook), Microsoft, and Google. After Apple entered the game, looking around the world, there are not many technology giants who have not set foot in the Metaverse. Although the popularity of Metaverse in the capital market has declined, from the perspective of actual business, the situation this year has made great progress compared with the past two years.

There is no doubt that Apple is currently in “growth anxiety”: iPhone growth is slowing, iPad growth has stalled, and it hasn’t released a new hardware device for years. In the past two years, Apple’s highlights have mainly been the self-developed M1 chip (which has been widely used in Mac computers and iPads), as well as the growth of services such as streaming media and financial services. However, for Apple, which has a market value of $2 trillion, these bright spots are not enough to raise the mid- to long-term ceiling. MR technology, which spans both traditional VR (virtual reality) and AR (augmented reality), has the potential to provide Apple with a much-needed new revenue stream.

Obviously, Apple’s ambitions will not be limited to selling hardware devices. Just like Meta, Microsoft and even ByteDance, it definitely wants to build a “metaverse ecology” covering hardware, software and services. Then, it will inevitably be involved in the ongoing “metaverse first line struggle”. So which side will it stand on? Can’t judge yet.

There are three main propositions around the future development route of the Metaverse:

The first one comes from the cryptocurrency circles, who are most concerned with speculation. Because the Metaverse definitely needs to use blockchain and NFT technology, they rejoice at the prospect. Of course, people in the currency circle want to organize the metaverse around cryptocurrencies, but they do not have any specific and actionable way. To put it bluntly, as long as the Metaverse allows them to speculate freely, they don’t really care how it develops.

The second one comes from Internet platform companies like Meta (Facebook), perhaps with the addition of ByteDance, which has just squeezed into the metaverse. Their definition of the metaverse is “the VRization of social networking/social media”, which is to do what you are doing again with VR technology. Because Zuckerberg is particularly enthusiastic about the metaverse and speaks so frequently, this view spreads the most widely.

The third type comes from content companies represented by game companies, such as Epic Games in the United States and Mihayou in China. Until recently, they had generally been on the sidelines, not eager to express their views on the Metaverse. However, just before and after Facebook changed its name to Meta, the CEOs of two heavyweight game companies made statements one after another, and invariably stood on the opposite side of Meta.

This is “the first line struggle of the Metaverse”. According to Zuckerberg, the founder of Meta, the Metaverse is naturally used to “do business”, and the remote office scenario is its first application scenario. “We’re used to sitting in conference rooms with other people instead of looking at a long list of faces on the screen,” Zuckerberg said. The only way to solve this problem is to rely on state-of-the-art VR equipment. VR will completely change the way people communicate online, turning “communication” (Telecom) into “teleport”.

Whether it’s an instant messaging tool like WhatsApp or a video conferencing system like Zoom, Zuckerberg thinks it’s not worth mentioning in front of the great “teleportation” mechanism of the Metaverse. When talking about the social significance of the metaverse, he emphasized that “it can allow a large number of employees to work in different places”, thereby liberating human productivity from geographical constraints. That’s Meta’s Metaverse route — letting employees wear MR helmets to remotely meet, collaborate, and run business. This route may be useful, but it is also tedious.

Now, let’s take a look at the views of two game companies on the opposite side of Meta – Epic Games and Take-Two.

On April 13, 2021, Epic Games announced the closing of a $1 billion funding round, raising the company’s overall valuation to $28.7 billion. Among them, Sony invested 200 million US dollars, and the remaining amount was divided among a series of financial investors. The purpose of this funding round is to “support Epic’s long-term vision for the Metaverse”; more specifically, “build social experiences in games like Fortnite, Rocket League, Jelly Bean,” while strengthening the company’s infrastructure capabilities such as Unreal Engine and Epic game store.

Among the mainstream games in the European and American markets, the metaverse color of “Fortnite” may be second only to “Roblox” because of its high degree of freedom and scalability. The game has three main modes:

  • Guarding the home, that is, PVE mode, players need to build their own fortress, upgrade their characters, and fight against monsters (that is, zombies) that attack at night. This is the earliest classic mode.

  • The airborne operation, that is, the PVP mode, is actually a “chicken-eating” game played by a hundred players, which can be played in single-player, two-player, and four-player teams. This is a mode that was added after the “chicken eating” gameplay became popular.

  • Creative Island, the free construction mode, is similar to the gameplay of “Minecraft”. Players can develop maps according to their own creativity and invite their friends to visit. This is a new mode added in December 2018.

Among the above three modes, the most popular and the one with the most players is the airborne action, that is, the “chicken eating” mode. In fact, before the launch of the “Chicken-eating Mode”, “Fortress Night” was just a relatively popular American tower defense + shooting game; after the “Chicken-eating Mode” was launched in September 2017, it has become the most popular game in the United States and even the world. One of the popular end games, even more popular than the genuine chicken-eating game “PUBG Mobile”. In 2017-18, there were hundreds of games that imitated and copied the “chicken-eating” gameplay, but only “Fortnite” achieved the greatest success, which must be attributed to its degree of freedom and scalability. Based on this scalability, it is completely feasible to imitate other popular gameplays – for example, there is no technical difficulty in implementing MOBA or RTS gameplay in “Fortnite”, and many players have long been looking forward to it.

In the US, young people who haven’t played Fortnite are a minority

From a business point of view, Fortnite has been very successful: just over a year after its launch, there were more than 125 million registered users in the second quarter of 2018; by the end of 2019, the game’s full-lifecycle operating income reached $9 billion , one of the most profitable esports games in history. Unlike “Roblox”, which also belongs to the “metaverse” concept, “Fortress Night” is an all-age game with a high proportion of adult players and a mature e-sports mode. In the United States, a large number of celebrities in the entertainment industry and social circles are die-hard players of this game, bringing huge social influence to it.

The fly in the ointment of “Fortress Night” is that the MOD mode has not been launched so far, that is, players have not yet been allowed to make secondary creations. In contrast, “Roblox” almost entirely relies on players and other third parties for content creation, so the frequency of gameplay updates is much higher. However, as early as the second half of 2020, some media reported that “Fortress Night” will launch a MOD mode, and I believe this day will not be too far away; it will be a solid step towards the “metaverse” vision.

On October 15, 2021, in an interview with The Washington Post, Epic founder and CEO Tim Sweeney explained his understanding of the metaverse in full for the first time. According to him, the Metaverse “is like an online playground where users can play a multiplayer game like Fortnite with friends one moment, watch a movie on Netflix the next, and then invite friends to try it out. Driving a new car – the way to build a car in the virtual world will be the same as in the real world.”

Immediately afterwards, Sweeney emphasized: “The Metaverse should never be a well-trimmed, advertising-inserted news feed platform, like Facebook!” I believe that when seeing this sentence, not only Zuckerberg will be stunned. A sneeze, ByteDance may also sneeze, because ByteDance also operates more than one “well-pruned, advertisement-inserted information flow platform”, and also wants to translate such a platform into the metaverse.

Specifically, Sweeney believes that the vast majority of users are fed up with the way the internet works today; not just with the technical form, but with the content form as well. Who wants to hold on to a “traditional information streaming platform” like Facebook or Instagram in an open digital world when VR technology is widespread? Moreover, the original Internet account model is also outdated. Players should have a unified “metaverse virtual identity” and use this identity to seamlessly log in to all Metaverse applications, instead of switching between a bunch of Google, Facebook or Twitter accounts. . Although not explicitly stated, the metaverse that Sweeney is looking forward to is likely to be an extended version of the Epic game platform – creators use advanced Unreal Engine for content development, users log in with Epic app store accounts, and use a similar “Fortress Night” of big games as the hub that connects everything.

Zuckerberg can of course retort Sweeney’s above-mentioned point of view: “Who said that Facebook in the metaverse era will still be an information flow platform that inserts advertisements everywhere?” As early as in a media interview on July 22, Zuckerberg said Ge made it clear that in the metaverse era, the way people obtain information will undergo fundamental changes, “Teleport” will replace “Telecom”, and the current mainstream information streaming media will definitely give way to immersion. 3D images. Although no one knows whether Facebook, renamed Meta, can realize such a vision, but we can at least say that Epic’s criticism of Facebook is like firing into the void and not really hitting the ground.

Coincidentally, on November 4, 2021, a week after Facebook changed its name to Meta, Strauss Zelnick, CEO of Take-Two, one of the largest game companies in the United States, was interviewed by CNBC. At the time, he elaborated on his views on the Metaverse, and it was precisely from the perspective of denying Meta! In my opinion, Take-Two’s refutation of Meta is deeper and more technical than Epic, and it is more worthy of our citation and analysis.

For veteran game fans, Take-Two is a familiar name: the parent company of top game studios such as 2K Games and Rockstar, which owns titles including Grand Theft Auto (GTA), Red Dead Redemption, NBA 2K “Civilization”, “Bioshock”, “Borderlands” and many other popular game IPs. The games developed and published by Take-Two are not only high-quality products, but also have a high success rate and a long life cycle. For example, “Grand Theft Auto”, “NBA 2K” and “Civilization” have decades of successful experience, spanning several generations of hardware platforms. It has deeply influenced generations of players.

Since most of Take-Two’s products are first released on the host platform, and often involve restricted-level themes such as violence and underworld, the proportion of domestic introductions in history is not high. However, the impact of Take-Two’s products on the domestic game industry is comprehensive and profound: today, we walk into the self-research department of any domestic game company and ask the producer or master planner “what is an ideal open world game” , he will definitely mention the names of “GTA5” and “Red Dead Redemption 2”; ask “what is the ideal sports competitive game”, and he will definitely mention the name of “NBA 2K”.

Unlike Epic Games, Take-Two has not accepted the transition to the in-app purchase payment model, and most products are still buy-out. The success of “Red Dead Redemption 2” in 2018 further consolidated its dominance in the AAA game field. In the following three years, the company continued to expand, setting up a number of new self-developed studios to enter more game categories. Incidentally, in January 2022, Take-Two announced the acquisition of US social game developer Zynga for $12.5 billion in cash + stock, thus fully sounding the clarion call to enter the mobile game market. As the best learning object for domestic game companies, Take-Two CEO Zelnick’s views on the Metaverse will inevitably attract the attention of the domestic game industry.

At the beginning of the interview with CNBC, Zelnick said unceremoniously: ” Take-Two is already one of the largest metaverse companies in the world in terms of revenue or profit. We operate GTA Online, and I think this game Defines the Metaverse today; we also operate Red Dead Online and NBA 2K Online, and millions of people log into these games every day.”

Zelnick then defines the metaverse: “That’s supposed to be a digital scene where we’re entertained, connecting with other people, talking, driving, engaging in crime, or playing the cop to stop crime; you’re supposed to have fun with it . This is what we have been doing!” Veteran players know at a glance, isn’t this the multiplayer mode of GTA5? Of course, Zelnick didn’t say that GTA5 is the complete form of the Metaverse; he just said that a large open-world game like GTA5 has everything the Metaverse needs and will be the basic starting point of the Metaverse.

So why isn’t Facebook’s metaverse vision correct? Zelnick’s answer is simple: that’s not what consumers want. Zuckerberg is touting a “strong social VR platform” primarily for telecommuting and business activities, which of course can also be used for entertainment, but entertainment is not the core function. Zelnick believes that this “real life extended in a virtual way” won’t interest consumers; they prefer to have fun through game-like entertainment.

“I doubt we’ll ever get used to waking up every morning with a VR headset on, deliberately sitting at home and doing our day-to-day work and life that way. We had to do it during this pandemic; but we really like it Do that?”

Do we really like “working from home”? questionable

Zelnick’s above question is believed to resonate with many people. This is his fundamental disagreement with Zuckerberg – the latter believes that VR-based remote work is the only way for human society to “free humans from the constraints of geographic location”; the former believes that this It’s a false proposition that normal people still prefer face-to-face work, so the metaverse is destined to have fun rather than work as its main mission. In addition, if the Metaverse takes work as its selling point, it can only be a corporate service business, and only large enterprises will accept the recruitment, and the customer scope is very narrow; with entertainment as the selling point, it will become a consumer business with a wide range of customers. Will include billions of consumers around the world.

To judge who is right and who is wrong between Zelnick and Zuckerberg, there is actually a good verification method: see if the trend of remote working will ebb after the global epidemic subsides, and how will corporate employees and employers choose the future way of working. However, the global epidemic may not subside in the short term; even if it subsides, it will take a long time to reach a new equilibrium. This is not a problem that can be solved in the short term.

Therefore, the first line struggle of the Metaverse will probably continue in the next few years or even decades. Empirically and logically, I’m more in favor of Sweeney and Zelnick: most people would expect a “second life” in the metaverse, not just a continuation of real life; so, who can Whoever provides richer entertainment content has the potential to gain a head start in the early stages of the metaverse. Epic Games and Take-Two are confident in their own metaverse prospects. In the final analysis, they believe in their content ecology and content development capabilities. In their eyes, it is impossible for a platform company like Meta, which does not produce content and cannot do well, to win the battle of the Metaverse.

But Apple’s entry is another story. Its financial resources are much higher than Meta, it has rich experience in hardware development, and has a complete ecosystem of software and hardware integration. In the past few years, it has made significant progress in the field of streaming media content such as original movies and music, but it has not yet ventured into game development. Apple’s content attributes are far stronger than Meta, and it has rich experience in dealing with content developers; in addition, in the office scene, its presence is not small – just look at how many companies in Europe and the United States use Mac as their main office computer. .

There’s no evidence yet on which side Apple will take in the “metaverse’s first line fight.” I believe it’s more likely to be on the “entertainment content” side, but what’s its roadmap? Will we soon see Apple’s own VR games and MR versions of the App Store? In any case, this will be another major transformation in the way of human communication and entertainment after the era of mobile Internet. There are still many new things waiting for us in the future, and it is exciting to think about it.

Parts of this article are taken from Phantom Thieves’ book “The Metaverse: The Imagination Revolution of Human Space Migration”, published in May 2022, with minor changes.


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