The “metaverse” was once thought to be “the next big thing,” but as of late, the craze behind the concept seems to have cooled down. The term, which Neal Stephenson coined in his sci-fi novel Snow Crash, is still without any concrete definition. But it’s frequently described as a 3D virtual world inhabited by real people through avatars.
The high cost of VR headsets and the complex and user-unfriendly interfaces are the main issues that metaverse developers are dealing with. As a result, despite investing billions in the creation of the metaverse platform, the companies have failed to draw in customers.
Walt Disney (DIS) recently made headlines for closing its next-gen storytelling and consumer experiences division, which was responsible for creating metaverse strategies. The change is part of a larger overhaul that involves 7,000 job cuts across the organization.
Additionally, the team behind Microsoft’s (MSFT) Mixed Reality Tool Kit platform, which was in charge of integrating AR and VR, was fired. Earlier this year, the tech giant also shut down AltspaceVR, a social VR platform it bought in 2017.
Lastly, Meta Platforms (META), the company that is partly responsible for building the hype about the metaverse, is also shifting focus from the metaverse to generative AI. Reality Labs, the company’s metaverse division, incurred $13.7 billion in losses last year. Recently, Meta cut staff in the metaverse division and discontinued its digital collectibles business.
At a time when such Wall Street heavyweights are struggling to build a future in the metaverse, smaller companies such as Decentraland and the Sandbox have gained traction among the NFT and crypto communities. Both of these companies provide users with a platform that allows them to buy virtual property and build their own worlds. Decentraland is also anticipated to benefit from Metaverse Fashion Week, where brands like Dolce & Gabbana and Tommy Hilfiger are participating.
