The metaverse, a concept that refers to a shared, immersive virtual environment facilitated by the use of VR and augmented reality (AR) headsets, has emerged into one of the hottest trends in the corporate world, becoming something startups and large companies alike began actively focusing on.

In October 2021, Facebook announced its rebranding to Meta Platforms to reflect the company’s push to build an avatar-filled virtual world. Meanwhile, Microsoft has chosen to focus on enterprises, announcing in March Mesh, a metaverse software feature which it plans to integrated into its videoconferencing app, Teams, later this year.

Across the world, in Asia, bigtechs including Baidu, Tencent and Alibaba are too investing in different pieces of that virtual future: Tencent, has invested in Roblox, a leading gaming firm and metaverse developer; NetEase, an Internet technology firm, is backing metaverse social network IMVU; and Baidu, a leading search engine provider, launched its metaverse just last month, allowing users to interact and visit virtual locations through avatars.

The metaverse has also caught the attention of investors, which poured more than US$10 billion into related startups in 2021, a significant jump from the US$5.9 billion companies in the sector raised in 2020, data from Crunchbase show.

Gaming and media firms take the lead

Though companies from all sectors and of all sizes have joined the metaverse frenzy, gaming firms appear to be taking the lead, a new report by Goldman Sachs Research says.

Often viewed solely through the lens of video games, companies such as Roblox and Epic Games have been pioneers in virtual experiences. These have capitalized on the shift to digital channels induced by the pandemic to further blur the lines between the virtual and physical worlds.

Roblox, for example, has seen accelerated adoption among brands across sectors including fashion and beauty, entertainment, sports and retail, in an effort to connect with a large, diverse and engaged user base through immersive experiences.

In May 2021, the gaming company teamed up with Gucci to recreate the Gucci Garden in Florence virtually. Players were able to shed their avatars transforming into mannequins, allowing visitors to try on different Gucci virtual items which they could then purchase.

Another example is Roblox’s partnership with Nike, which focused on building Nikeland, a virtual space that includes fields, arenas, and courts for game play and product showrooms.

Virtual events and parties have also been held on Roblox, allowing for artists and labels such as Sony and Lil Nas X to connect with fans.

In addition to gaming platforms, communication apps and media platforms also appear to have a head start in the metaverse race, having capitalized on the large-scaled adoption of their social media channels, and early investments in data center infrastructure as well as VR/AR technology.

In 2014, Meta Platforms acquired Oculus for US$2.4 billion as its first foray into VR products. Since then, other acquisitions have followed suit, including Downpour Interactive, Ready at Dawn, Sanzaru Games, Beat Games, BigBox VR, and most recently, Within, the developer of Supernatural, a VR fitness app that can be used with Oculus Quest headsets, and ImagineOptix, a specialist in optical technologies that can be used in VR/AR devices.

Meta Platforms is planning to release a new VR headset called Project Cambria later this year. The device will be a high-end product and will be packed with the latest advanced technologies, including improved social presence, color Passthrough and pancake optics, the firm said in a blog post.

In addition, Meta Platforms is working on its first full-fledged AR glasses, an initiative that’s been code-named Project Nazare.