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Large-scale adoption of metaverse likely 8-10 years away: Nasscom-McKinsey study

Large-scale adoption of metaverse likely 8-10 years away: Nasscom-McKinsey study
Photo Credit: Pixabay
24 Jan, 2023
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While the term ‘Metaverse’ — a virtual world where digital goods and services are exchanged — existed for nearly two decades, and is now driven by technology revolution a new study published on Tuesday, shows that metaverse initiatives at present largely remain experimental and its large-scale adoption is likely 8-10 years away. 

The study, jointly published by industry body Nasscom and consulting firm McKinsey & Company, further said that even though over half (57%) of the CXOs or decision makers in a new study believe that the metaverse initiatives are underway — with some companies already working on their own metaverse-related projects — a whopping 30-40% highlight uncertain return on investment (RoI) on the concept.  

According to the study, technology and talent readiness will determine the rate of adoption of metaverse in the country.  

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While still nascent, various aspects of metaverse have been around for two decades with online games and interactive spaces such as Second Life, Fortnite, Roblox and others, promising an immersive digital world driven by advancements in computing. However, there are a number of areas enterprises need to evaluate when going for a metaverse-related projects. 

According to the study, for the immersive computing to scale, a 1000x increase in computation efficiency is required, a concern also echoed by Raja Koduri, a senior VP at Intel. He added even “hardware alone will not be able to reach that 1000x number — at least not any time soon — instead suggesting that AI and software improvements will make up the gap”.  

In this context, the study shed light on the availability of talent that will drive metaverse. It added that talent pool will in the future will come from 3D/Technical Artists, motion designers, graphic engineers and from functions including blockchain and cryptocurrency, gaming, UI/UX, AI/ML programming, and cybersecurity skill sets. Further the study highlights that technology readiness of compute and network infrastructure should also improve for widespread adoption to happen. 

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Nonetheless, the study said that metaverse has the potential to revolutionise the Internet where users will be able to explore, transact, interact, engage, build, and potentially, even live in 3D, boundary-less, all-virtual environments. By 2030, sectors such as retail, manufacturing, media, healthcare, telecom, professional services and banking are likely to be major spend drivers of enterprise use cases in the metaverse.   

Sangeeta Gupta, senior vice president and head of strategy at Nasscom said that “while slowdown may be expected due to the macro-economic environment, the promise of metaverse use-cases is starting to reflect in the mushrooming of proof of concepts (POCs) across sectors. Use-cases are also being seen across customer interaction, employee interaction and production and design”.   

“Global enterprises are experimenting with metaverse as the means to capture the Gen Z and the Gen Alpha consumers early in their digital forays. In industrial use cases, digital twins in operations is a fast growth theme,” she said, that  believes, as the underlying tech matures — with an estimated need of 1000x compute power, big 3D-capable developer pool, and demonstrable RoI — societal impact and acceptance will also play a critical role in advancing metaverse into a transformative convergence of digital technologies.  

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On Monday, Deloitte released the India edition of its ‘Tech Trends 2023’ report and highlighted that immersive internet is the next stage in the evolution of video calls with the rise of the metaverse. As per the market estimates, the metaverse industry in India is expected to grow at an impressive CAGR of 37.1% and touch $758 billion by the end of 2026. In addition to the global tech giants racing to build on the emerging metaverse concept, leading Indian firms are announcing the development of the metaverse as well, the study said.