Aboard the metaverse, business should not lose touch with reality
The metaverse, a $1 trillion annual revenue opportunity, has increasingly attracted businesses seeking to boost growth in virtual spaces.
Despite not having an official definition, several businesses have already established their metaverse headquarters.
As more companies start operating in these shared virtual environments, several of our daily activities will occur online. For example, we already see shopping stores, museums, restaurants, festivals, conferences and real estate on different virtual reality platforms that ultimately will change our perception of and interaction with urban space.
Nevertheless, this exodus to the metaverse requires public policy by design to ensure that business engagement with virtual urban spaces safeguards privacy, safety, security and equity. It means businesses must increasingly consider and understand tech policy issues that are high priority on regulators’ agendas.
Many businesses have already established their digital twin or equivalent in these computer-generated environments, noting that tomorrow’s city dwellers may prefer the metaverse to physical urban amenities.
In November 2021, Nike opened Nikeland on Roblox to offer Nike products and outfits to users’ avatars. In January this year, Samsung opened its first metaverse store on Decentraland, Samsung 837X, an immersive world modeled after its flagship New York store.
Several significant events have already transitioned to virtual venues, including the Metaverse Fashion Week 2022, Tour de France bike rides and the Sundance Film Festival, where artists like Ariana Grande, J. Balvin and Travis Scott performed virtual concerts.
Scott’s Astronomical tour, shown on the video game platform Fortnite in 2020, attracted more than 45 million viewers. In June 2022, the restaurant chain Wendy’s expanded its virtual kingdom by launching a new experience called Sunrise City in Meta’s Horizon Worlds VR platform.
Entertainment conglomerate Disney was granted a patent for a “virtual world simulator” in December 2021 as part of the company’s plan to develop a virtual theme park.
As these examples demonstrate, virtual reality, augmented reality and extended reality are no longer the preserve of big tech companies and niche enthusiasts. These technologies are already being used across sectors to overcome physical space barriers and enhance how individuals can interact with the world around them.
As virtual technologies proliferate across homes, workplaces, classrooms and other aspects of everyday life, they have the potential to enhance businesses and public services and expand economic and social opportunities for individuals and entities.
For example, the recently launched Dubai Metaverse Strategy aims to create 40,000 virtual jobs and add $4 billion to Dubai’s economy in five years.
The cross-sector relevance and usage of these virtual technologies suggest that businesses, not just big tech, need to maneuver rapidly developing policy and regulatory landscapes.
As businesses enter the virtual world, addressing key policy issues is imperative to ensure that stakeholders in the metaverse operate responsibly.
Firstly, companies must understand regulatory frameworks on privacy, data protection and governance. To reach the full potential of these technologies, AR/VR/XR devices require a large amount of information about individuals and their surroundings to deliver immersive, engaging experiences.
For example, to comply with Saudi Arabia’s Personal Data Protection Law, businesses must have a clear understanding of the nature of the data they hold, establish how this data will be collected and governed and create policies and procedures for handling, processing and sharing the data in accordance with the law.
Secondly, immersive urban spaces raise safety and security considerations, especially regarding the potential for physical and emotional harm, mental health and addiction. Therefore, it is essential to establish guardrails that protect children’s physical and emotional well-being across virtual experiences.
Virtual reality, augmented reality and extended reality are no longer the preserve of big tech companies and niche enthusiasts.
Businesses must comply with cybersecurity regulatory frameworks, cross-border data transfers, digital content, digital advertising, online consumer protection, and laws and regulations on e-commerce, e-transactions and virtual assets for safe and secure transactions in the metaverse.
Companies expanding business to the virtual world should craft a metaverse engagement strategy that includes public policy issues and advocacy, among its key features.
As the technology continues to evolve, established guidelines and best practices will allow companies to innovate while contributing to responsibly developing virtual urban spaces.
- Anja Engen is a policy analyst for consultancy firm Access Partnership Middle East.