Editorial: My Social VR/Virtual World Predictions for 2021

Photo by Hulki Okan Tabak on Unsplash

Every year, for the past couple of years, I have traditionally drawn up and published a list of predictions on where I see social VR and virtual worlds going over the next twelve months. As someone who keeps an eagle eye on the comings and goings of the various companies that are building the ever-evolving metaverse, I’m pretty well placed to be able to make some educated guesses.

However, you should be aware that my track record as a prognosticator is truly lamentable; more often than not, I have been proven dead wrong. For example, I rather sarcastically predicted that Cryptovoxels would fail, hard, and it has done nothing but flourish (something which I am happy to see and report on here on the RyanSchultz.com blog). So, what do I know?

Therefore, please take the following three predictions with a grain of salt.

Second Life will continue to be successful and profitable—but it will face increasing competition from newer platforms such as VRChat, and it will no longer be the most popular virtual world

My first prediction is a no-brainer. In my predictions for 2019, I wrote that Second Life would “continue to coast along, baffling the mainstream news media and the general public with its vitality and longevity”, and that still holds true. Linden Lab sold the money-losing Sansar social VR platform to Wookey, and the remaining, profitable company was successfully acquired by the Waterfield investment group.

As of yet, there have been no major changes announced by the new owners; it would appear that Waterfield is content with the way that Linden Lab is running the virtual world of Second Life and the Tilia payment processing business (which has also been picked up by a few non-SL clients). However, Linden Lab’s CEO, Ebbe Altberg, might decide that this year is now a good time for him to step down (although I would personally hate to see him go, as he has been one of the better CEOs in Linden Lab’s sometimes rocky history).

However, I will agree with a prediction made by Wagner James Au of the long-running blog New World Notes, who in his list of predictions stated:

Both VRChat and Rec Room will finally surpass Second Life in peak concurrency numbers.

In fact, we have already seen days and times when the total number of users in both VRChat and Rec Room surpasses that of Second Life. I predict that 2021 will finally be the year that a newer platform will pass the venerable Second Life to become the most popular metaverse.

I am busy exploring VRChat most evenings, wearing my Valve Index VR headset and using my Knuckles controllers, and greatly enjoying the enhanced audiovisual experience it gives me. (I get a big kick of out being able to wiggle my avatar’s fingers!) VRChat now gives me serious vibes of what Second Life was like in its heyday, circa 2006 and 2007: a place which you might not always like, but a place you could not afford to ignore! A place where you are never quite sure what is going to happen.

And it would appear that other popular social VR platforms, such as Rec Room, are also reaping the benefits of the network effect: the more people who join a platform, the better the value it provides. This same network effect helped drive Facebook into becoming the dominant force in social media, and it turned Fortnite into a cultural juggernaut, so it is not something to be lightly dismissed.

The coronavirus pandemic will continue to provide opportunities for social VR and virtual world companies, particularly for remote workteams, conferences, and education

The testing, approval, manufacture, and delivery of COVID-19 vaccines will continue to be slower than originally anticipated, and virus mutations may blunt the effectiveness of some vaccines, and require some to be reformulated in response. All of this means that we are not going to be returning to “normal” anytime very soon.

This situation provides a window of opportunity for metaverse-building companies to sell their products and services to corporations, conferences, and educational institutions. I expect that we will see more announcements this year of conferences taking place with a social VR/virtual world component, for example.

While games and recreation will still form the largest part of the virtual reality consumer market, we can also expect to see more practical applications of VR in areas such as pain reduction, physical rehabilitation, and mental heath support.

And we can expect that more and more corporations will be looking at downsizing expensive downtown real estate and shifting permanently to remote workteams, which will fuel the what I like to call the “YARTVRA” (Yet Another Remote Teamwork Virtual Reality App) market.

Facebook is going to have a very bad year, despite the commercial success of the Oculus Quest 2

The Quest 2 is not a toy. It’s a virus disguised as a toy.

—Cix Liv, The Voices of VR Podcast with Kent Bye (source)

Speaking of Facebook, I predict that the corporate behemoth is going to have a rocky year. On December 3rd, 2020, Bloomberg News published an article on their website, titled Facebook Accused of Squeezing Rival Startups in Virtual Reality (original article, archived link), which paints a rather damning picture of Facebook’s ruthless corporate tactics in dealing with (and stealing business ideas from) much smaller companies.

Frankly, Facebook faces major hurdles in public relations and public perception, a problem that is only growing worse as the company becomes more powerful and more profitable, and seeks to enter and dominate new markets. Many people (myself included among them) simply don’t trust Facebook anymore, and aren’t willing to have their personal data shared among the many companies under the Facebook umbrella, strip-mined for profit, and sold to the highest bidder.

To give one example, recent changes to WhatsApp privacy policies, forcing users to share information with Facebook, have led to many people abandoning the messaging platform. Add to this the recently-announced U.S. federal government investigation into Facebook’s possible illegal monopolization of the social networking market, and the fuss kicked up in the virtual reality community by Facebook requiring Oculus VR device users to sign up for Facebook accounts, and it seems pretty clear that Mark Zuckerberg will be called upon to testify before even more government panels this year. (And you might not know this, but the next time that Mark or Facebook COO Sheryl Sandberg set foot on Canadian soil, they can be compelled to appear before a Canadian parliamentary committee with jurisdiction over tech issues, as a direct result of refusing to show up for hearings in 2019, which were attended by representatives of countries all over the world.)

So, these are my three predictions for 2021 (and I reserve the right to add more as they come to me). What do you think will happen this year? Feel free to leave a comment on this blogpost, or join the free-wheeling discussion on the RyanSchultz.com Discord channel, and share your predictions with the 460-plus members there! We’d love to have you become a part of our cross-worlds community!

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