UPDATED! Editorial: How the Crypto Crash—and Meta’s Missteps—Are Souring the General Public on the Metaverse

As somebody who writes about social VR and flatscreen virtual worlds on this blog, with a popular Discord server packed with metaverse fanatics and a front-row seat on pretty much everything that has been happening in this space, let me tell you, the past twelve months have been a wild ride. You can even see it in my blog statistics of the number of visitors and views the RyanSchultz.com blog has attracted over the past year:

See that surge from October through March? In October, Mark Zuckerberg announced in a Connect 2021 keynote that Facebook would rebrand as Meta, and would focus on realizing his vision of the metaverse. This also coincided with a crypto speculation boom, where people and companies were frantically bidding for artificially scarce NFT-based plots of land in various blockchain metaverse platforms.

Together, these events sparked a greater awareness among the general public of the metaverse (as indicated by a corresponding increase in traffic to my blog). However, it would appear that the ongoing crypto crash, combined with Meta’s recent woes and missteps, are causing people to sour on the concept. (And by “people”, I mean the general public, not the metaverse fanatics, content creators and world builders whom I tend to hang out with!)

As an illustration of this, I would like to focus on a recent announcement made by Mark Zuckerberg, about the expansion of their flagship consumer social VR platform, Horizon Worlds, from Canada, the U.S. and the U.K. into two new countries, France and Spain:

The first thing I think of when I look at this picture is: hoo boy, somebody working in Meta’s PR department is gonna get fired! You’re trying to sell people on Horizon Worlds with this unappealing, uninspiring, and frankly ugly image on Twitter?


The response to this on two different subreddit communities on Reddit, r/technology and r/Buttcoin, proves to be quite illuminating. (By the way, r/Buttcoin is the blockchain, crypto, and NFTs snark community, where we cryptoskeptics and critics love to discuss and dissect the latest shenanigans, antics, and scams in that world!)

Here are some of the better comments on the r/technology post, sparked by Paul Tessi’s biting August 17th, 2022 Fortune article, Does Mark Zuckerberg Not Understand How Bad His Metaverse Looks?

It looks like Mark Zuckerberg watched Ready Player One and thought he would be able to recreate that universe with MS Paint.

“Looking forward to seeing people explore and build immersive worlds!” :: “Work in my content mill, peasants.”

The more money they dump into this dumpster fire, the better chance Facebook finally collapses into the abyss. So keep doing it Zuck.

One much-upvoted comment reads as follows:

No one is building a $1500-2500 PC with [a] dedicated GPU to add a Facebook $600 VR headset to attend work meetings in a virtual space that looks like a kids CGI series from 2004 at a mass adoption level, where the majority of the public would use it daily for 8 hours at work then again for another 4-6 hours “for fun” at home, as the Meta dystopian dream suggests.

Meta has already been subsidizing the costs of their currently meh headset, which they just increased the prices of, as they were losing too much money.

For this to work, the hardware has to be good enough for grandma to be able to buy it on a pension, put it on out of the box and it just works, and it does not make her sick to her stomach in 5-20 minutes due to the low frame rates and quality.

That’s the barrier of entry to the space you need to be able to target… if that old guy at your office struggles with getting their mic to work on MS Teams for a video call every day, as the manager he is not going to order $100,000 worth of gear for your department that is hard to setup and use to meet in the metaverse.

This thing is dead on arrival, but Facebook is also dying/dead in it’s current form, so this Hail Mary [pass] is all they have.

In the August 17th Fortune article which spawned these responses, reporter Paul Tassi writes:

The thing is, this happens all the time with Zuckerberg and his metaverse because Horizon Worlds has looked terrible since its inception and has barely gotten any better over the years, where its avatars still look like Miis from 2012 and they still don’t have legs.

Granted, I understand that showing 2D screenshots of VR is difficult, and that VR generally lags behind traditional console and PC gaming in terms of graphics. And yet that doesn’t change the fact that even within VR, Horizon Worlds is one of the worst-looking offerings I have seen, and that Meta has spent something like $10 billion chasing its Horizon, VR-centric version of the metaverse, even embarrassingly changing their company name to reflect that. And…this is the result.


Meanwhile, here are some of the opinions of the cryptosnarkers over on r/Buttcoin:

If I was a Meta stockholder I would be selling the minute I saw that screenshot.

He (and many others) are hoping that nobody remembers Second Life ever existed, let alone that it still does. It has a dedicated audience of somewhere between half to one million users and that’s kinda it. I suspect the future for “the metaverse” is similar.

One r/Buttcoin member posted the following detailed comment:

This is the part I don’t understand. Any “meta” style environment will be incredibly limited in terms of graphics and gameplay due to the need to have a high number of players at once. So who is the target audience?

• Someone looking to play a game is going to go with something like Grand Theft Auto V (and continue to move on to the next biggest thing when they come out).
• The live concerts! aspect of the website seems equally absurd given the graphical limitations and that this would be less entertaining than watching a concert on TV.
• Your casual Farmville-style person isn’t shelling out hundreds of dollars for a VR headset.
• For their “practical” concepts like virtual stores, it seems to invalidate the concept of buying metaverse land as either the system will allow for fast travel style movement (making “premium” land a joke), or not allow for this travelling and completely turn off their customer base for this.

I just don’t see where the interest comes from.

And I chuckled at this wag’s opinion:

Second Life managed to survive because it fostered a community of weirdo people who fetishized the environment. I think the only person who fetishizes Facebook’s metaverse is Zuckerberg.

Absolutely SAVAGE! I live. Somebody else posted this gem to the r/Buttcoin subreddit:


Even worse, the cryptobros are starting to dunk on the metaverse, notably Shark Tank billionaire investor Mark Cuban. According to an August 8th, 2022 report in Fortune:

Mark Cuban, the billionaire Dallas Mavericks owner and avid crypto enthusiast, is not sold on the metaverse.

“The worst part is that people are buying real estate in these places. That’s just the dumbest shit ever,” he told the crypto-themed YouTube channel Altcoin Daily this past weekend.

I’m quite sure that the various blockchain-based metaverses like Voxels (formerly known as Cryptovoxels), Decentraland, Somnium Space, and The Sandbox, all of whom have seen the value and the trading volume of their NFT-based real estate decline during this crypto winter, were not expecting the ridicule and disdain of crypto influencers themselves! After all, the crypto crowd are main target audience of these platforms, not your average non-crypto user. You know things are getting weird when the cryptobros start to turn on each other!


So, what does all this mean? Well, it looks as though the concept of the metaverse, at least among the general public, is going to sustain some reputational damage, at least in the short term (12 to 24 months). Perhaps it was inevitable that there would be such a swing from irrational metaverse exuberance to equally irrational metaverse distaste, even disgust.

I am reminded of the Gartner technology consulting group’s well-known Hype Cycle, where we appear to be rapidly moving from the peak of inflated expectations, to the trough of disillusionment:

The five steps of the Gartner Hype Cycle (source: Wikipedia)

Also, this “trough of disillusionment” means that it’s going to be harder to sell consumers and businesses on the metaverse. This will apply both to behemoth corporations like Meta, Apple, and Alphabet (the parent company of Google), as well as to much smaller metaverse-building companies. As I have said before, not all platforms currently being worked on will survive this rough period.

It is possible, perhaps even likely, that only a handful will achieve dominance in this ever-evolving market, leaving the other firms to fight over the leftover scraps. Of course, some companies will be savvy enough to focus on a profitable niche market, such as the surgical training platform FundamentalVR, which recently received another venture capital infusion of US$20 million.

So, as Bette Davis once memorably said in the movie All About Eve: “Fasten your seatbelts…it’s going to be a bumpy night!”

UPDATE August 19th, 2022: As further evidence of the antipathy towards Mark Zuckerberg’s latest announcement, Zack Zwiezen wrote this scathing report for Kotaku, titled Mark Zuckerberg’s Soulless Metaverse Avatar Has Me Worried About Our Digital Future:

Earlier this week, the alien-wearing-a-human-skin-suit known to us as Mark Zuckerberg posted a VR selfie from inside his company’s metaverse project, Horizon Worlds. The selfie showed off the Eiffel Tower and was meant to announce that his metaverse is expanding to more countries. Instead, however, people immediately began dunking on the terrible picture, the ugly avatar, and how it all looked like it fell out of a 2005 edutainment game

And that brings us to 2022, where Zuckerberg’s avatar is a legless knock-off of a Nintendo Mii with some really weird buttons and the eyes of a corpse. And this isn’t just how Zuckerberg looks, this is the way all avatars appear in Horizon Worlds. I’ve played enough Horizon Worlds to tell you that the missing legs quickly cease to matter. But the lack of style and the cold, dead aesthetic never goes away.

Sure, part of the reason these avatars and worlds look simple and ugly compared to modern video games comes down to the limited VR hardware in Quest 2 and Facebook’s desire to make VR content that can run on as many devices as possible.

On the other hand, I can find Nintendo DS and Sony PS Vita games with better, nicer-looking art and models than what we’ve been shown so far in Facebook’s metaverse. I also don’t think you can blame the people making this stuff, as I assume they are more than capable of doing better and more vibrant things. But more and more, it seems that isn’t what Meta and Zucklehead want. Instead, they are focused on making a product that can be consumed by the masses and which lacks any defining characteristics in an attempt to get more people to dive in.

This is the exact opposite approach we see in more community-driven VR metaverses like VR Chat, which looks better and feels warmer and more inviting. In comparison, Horizon Worlds looks like an animated video I’d walk by in some fancy hospital while I look for the bathroom.

And if this bland and ugly metaverse is the future Mark Zuckerberg wants and is investing billions of dollars into, I’m worried that it could end up winning out over other, better alternatives simply because he has the money and resources to squash or buy up competitors. Well, if it does win out, at least I’ll be able to skip it and not buy a new VR headset.

Yee-OUCH!!!

Also, as further evidence of the distress in the entire cryptosphere, Bloomberg reports that ad spending by the crypto firms has absolutely cratered:

Spending by major crypto firms, including the trading platforms Crypto.com, Coinbase Global Inc. and FTX, fell to $36,000 in July in the US, according to ISpot. That’s the lowest monthly total since January 2021 and is down from a high of $84.5 million in February, when the industry flooded the airwaves around the Super Bowl.

Again, Yeee-OUCH!!! And it looks like things are not going to get better anytime soon, as inflation roars and recession looms. People have more important things to worry about (like keeping food on the table and a roof over their heads) than buying virtual real estate on the blockchain!

In December 2021, Republic Realm spent approximately US$4.3 million worth of land in The Sandbox, setting a record for the most expensive land sale in the metaverse (more about Republic Realm here). It would appear to be highly unlikely that Republic Realm, or any of the other investors who bought NFT-based plots of virtual land at the height of the boom market, are going to be able to earn a profit anytime soon.

Has the bottom fallen out of the NFT-based metaverse market? And what does this mean for the concept of the metaverse in general? Stay tuned!

I Was Interviewed by a Business Reporter for The Globe and Mail for an Article About the Metaverse

On March 10th, 2022, I was contacted by Joe Castaldo, a business reporter for The Globe and Mail (which bills itself as “Canada’s National Newspaper”). He was writing up a story about businesses entering the metaverse, and the current metaverse hype cycle, and he asked me if I would be willing to be interviewed.

After checking in with my union representatives at the university, who gave me the all-clear to go ahead, I was interviewed for an hour via telephone. The Globe and Mail had given Joe a Meta Quest 2 wireless VR headset, so a couple of weeks later, I gave him a guided tour of two popular social VR platforms, VRChat and AltspaceVR.

Well, Joe’s article was published in The Globe and Mail today, titled Is the metaverse the future of the internet? A Globe journalist steps inside to find out (if you should hit a paywall, here is an archived version).

I’m not going to reproduce the entire newspaper article here; I was mentioned in the final few paragraphs:

For Ryan Schultz, the widespread interest in the metaverse is a little weird. “My obscure, niche hobby has suddenly gone mainstream,” he told me. A reference librarian with the University of Manitoba, he spends a few hours every week strapped into a headset or exploring desktop-based worlds, and has been blogging about it for years.

Mr. Schultz finds the speculative nature of the digital land rush in some worlds off-putting. “People are investing in this basically as a flex and as a boast to their friends that they can afford these artificially limited items,” he said. Businesses with virtual office space, meanwhile, are likely spending money on a “really fancy three-dimensional brochure.”

He’s seen much of it before. Corporations flocked to Second Life when it took off in the 2000s. Coca-Cola installed soft drink machines, Toyota set up a car dealership, American Apparel built a clothing store, and IBM established an island for employee recruitment and training.

It wasn’t long before the corporate enthusiasm died. “Nobody came to visit these locations, because the people who were already in Second Life didn’t care,” Mr. Schultz said.

He understands the appeal of virtual worlds, though. When he first discovered Second Life, he spent hours there each day. Away from the computer, he has jokingly called himself an “overweight, divorced, gay librarian with diabetes.” At 58, he feels his body growing older, and he’s struggled with depression so bad he’s taken leaves from work. “I kinda suck at this whole reality business,” he wrote on his blog.

In Second Life, Mr. Schultz loved building avatars – angels, supermodels and a Na’vi from, well, Avatar. There was solace in becoming someone else. During the pandemic, he’s met his social needs through virtual reality, and a mental-health app became a lifeline. “I can put on my headset, join a group, and use cognitive behavioural therapy techniques to work through issues and problems, and it’s extremely powerful,” he said. “You feel like you’re really present.”

For those of us who are not already immersed, such moments are likely a long way off. I searched high and low for meaning and connection in the metaverse, but mostly found empty branding experiences, a speculative frenzy around digital assets, and people who were just as curious as I was to find out what this was all about, and were still searching for answers.

But given the relentless enthusiasm of those trying to turn the metaverse into some kind of reality, there will be plenty of chances to try again, for better or worse.

I think that Joe did a good job of describing the metaverse in a way that newspaper readers could easily understand, and there are a couple of videos included in the digital version of the article which made me laugh at certain points, as Joe and his producer Patrick Dell navigated Decentraland and Horizon Worlds!

I also appreciated that the online article linked out to my ever-popular list of social VR platforms and virtual worlds. I’m not really expecting a spike in traffic to my blog (I didn’t get one when I was interviewed by a writer for New Yorker magazine in 2019), but it was an interesting experience, nonetheless.

(By the way, I do receive more and more requests to be interviewed lately, because of my blog. I turn most of them down, but I said yes to this one, because The Globe and Mail is a major Canadian newspaper, and one which I read often.)

The Globe and Mail newspaper interviewed me for an article on the metaverse

P.S. The mental health app mentioned in the quote above is called Help Club; here’s the blogpost which I wrote about this self-help social VR app for mental health.

After News Reports of Sexual Harassment, Meta Implements a Four-Foot Personal Boundary for Avatars in Horizon Worlds and Horizon Venues

Unfortunately, sexual harassment online is pervasive, happening in such disparate venues as social media, chat rooms, Discord servers, and role-playing games. Virtual worlds and social VR are no exception. Again, this is not a new problem; I have been writing about trolling, griefing and harassment in the metaverse, and how companies are responding to it, since May of 2018 on this blog.

There have been several recent news reports about women who reported being groped or otherwise harassed in Meta’s social VR platforms Horizon Worlds and Horizon Venues. For example, the U.K.’s Daily Mail had this report about a women who was assaulted after logging into Horizon Venues:

Nina Jane Patel watched and listened in horror through a virtual-reality headset as her avatar – a moving, talking, computer-generated version of herself – was groped aggressively in a sustained attack by three realistic male characters.

On a visit this month, the mother-of-four entered the ‘lobby’ – a virtual space serving as an entry point. But within seconds she was pursued by the men’s avatars, who groped her, subjected her to a stream of sexual innuendo and took screen shots of the attack for several minutes as she tried to flee.

Alex Heath of The Verge reported on December 9th, 2021:

Earlier this month, a beta tester posted in the official Horizon group on Facebook about how her avatar was groped by a stranger. “Sexual harassment is no joke on the regular internet, but being in VR adds another layer that makes the event more intense,” she wrote. “Not only was I groped last night, but there were other people there who supported this behavior which made me feel isolated in the Plaza.”

[Vivek] Sharma [Meta’s VP of Horizon] calls the incident “absolutely unfortunate” and says that after Meta reviewed the incident, the company determined that the beta tester didn’t utilize the safety features built into Horizon Worlds, including the ability to block someone from interacting with you. (When you’re in Horizon, a rolling buffer of what you see is saved locally on your Oculus headset and then sent to Meta for human review if an incident is reported.) “That’s good feedback still for us because I want to make [the blocking feature] trivially easy and findable,” he says.

This event was widely reported by a variety of news sources, ranging from the New York Post to the MIT Technology Review. Victor Tangermann wrote in a Dec. 16th, 2021 Futurism article titled Sexual Assault Is Already Happening in the Metaverse:

Rather than ensuring Horizon Worlds doesn’t foster a culture of strangers groping each other in VR, Meta is hoping to make the problem go away by making adjustments to its tools. The company says users can turn on a feature called “Safe Zone,” which creates an impenetrable bubble around the user when they want more space.

But personal space is likely to be a galling problem for social VR applications.

“I think people should keep in mind that sexual harassment has never had to be a physical thing,” Jesse Fox, an associate professor at Ohio State University, told MIT Technology Review. “It can be verbal, and yes, it can be a virtual experience as well.”

Bloomberg columnist Parmy Olson also wasn’t exactly impressed by Meta’s VR experience, either. Once in the VR lobby of Horizon Venues — Meta’s VR events platform that is serving as Horizon Worlds’ precursor — she was being surrounded by a “group of male avatars” who started taking pictures of her.

“One by one, they began handing the photos to me,” Olson writes. “The experience was awkward and I felt a bit like a specimen.”

Meta may have thought they would have avoided these kind of problems by deliberately designing their avatars to have no body below the waist. No genitals, no problem, right? WRONG. It’s not what the avatars look like that’s the issue here; it’s how the people using the avatars behave towards each other.

Note also Parmy Olson’s incident in the previous quote: in her case, the group of male avatars were using Horizon Worlds’ built-in camera feature to make her feel uncomfortable. Harassment can take many forms, and may involve the abuse of features which the developers never dreamed would be so misused.

On February 4th, 2022, no doubt in response to these and other news reports and the negative publicity they generated, Meta announced a Personal Boundary feature:

Today, we’re announcing Personal Boundary for Horizon Worlds and Horizon Venues. Personal Boundary prevents avatars from coming within a set distance of each other, creating more personal space for people and making it easier to avoid unwanted interactions. Personal Boundary will begin rolling out today everywhere inside of Horizon Worlds and Horizon Venues, and will by default make it feel like there is an almost 4-foot distance between your avatar and others.

This Personal Boundary feature is hard-coded, at least for now; you cannot turn it off or adjust the distance. According to the press release:

We are intentionally rolling out Personal Boundary as always on, by default, because we think this will help to set behavioral norms—and that’s important for a relatively new medium like VR. In the future, we’ll explore the possibility of adding in new controls and UI changes, like letting people customize the size of their Personal Boundary.

Note that because Personal Boundary is the default experience, you’ll need to extend your arms to be able to high-five or fist bump other people’s avatars in Horizon Worlds or in Horizon Venues.

Adi Robinson of The Verge clarifies that “it gives everyone a two-foot radius of virtual personal space, creating the equivalent of four virtual feet between avatars”, adding:

Meta spokesperson Kristina Milian confirmed that users can’t choose to disable their personal boundaries since the system is intended to establish standard norms for how people interact in VR. However, future changes could let people customize the size of the radius.

If someone tries to walk or teleport within your personal space, their forward motion will stop. However, Milian says that you can still move past another avatar, so users can’t do things like use their bubbles to block entrances or trap people in virtual space

Contrast Meta’s approach with other platforms such as Sansar, which gives the user control over whether or not they want to set up personal space between themselves and other avatars, allowing them to set up one distance for people on their friends list (or to turn it off completely, and set another for non-friends and strangers (see the Comfort Zone settings in the image below):

And, of course, VRChat has an elaborate, six-level Trust and Safety system, where you can make adjustments to mute/hide avatars, among other settings.

A few thoughts about all this. Because Meta is such a large, well-known company, it was perhaps inevitable that such reports would be considered newsworthy—even though sexual harassment has been around for decades in virtual worlds, dating back to Active Worlds, founded over a quarter-century ago!

Also, the immersive nature of virtual reality can make such harassment feel more invasive. Jessica Outlaw has researched and written at length about women’s experience of harassment in virtual reality (here and here).

Finally, like all the metaverse platforms which came before it, Meta is learning and making adjustments to its social VR platforms over time. This is common and is to be expected. For example, Second Life has had a long history of discovering and addressing problems which arose during its 18+ years of existence. Some fixes are good; others cause their own problems, and require further tinkering.

I personally believe that the best solution to the continuing problem of sexual harassment in the metaverse requires a deft mix of social and community rules and expectations with software solutions such as the Personal Boundary feature, and muting/blocking avatars. There is no easy fix; we learn as we go.

Editorial: Meta’s Horizon Social VR Strategy Is Currently a Bit of a Mess

As many of you already know, I responded to last October’s announcement by Meta (then still called Facebook) that owners of Oculus VR hardware would have to set up accounts on the Facebook social network, by personally boycotting all Meta products and services—including the Horizon Venues, Horizon Worlds, and Horizon Workrooms social VR platforms. (Here’s the blogpost where I announced my decision.)

Since that announcement (full text here), I have replaced my trusty Oculus Rift tethered VR headset, which up until that point I had been perfectly happy with, with a Valve Index (which I love to use and I consider an upgrade in every single way from the Rift). I also did a factory reset on my Oculus Quest 1, sending it to my sister-in-law in Alberta, who might use it in her work with developmentally-challenged adults (she has no qualms about having a Facebook account, and it’s going to a good cause). I had already deleted my Facebook account previously, and I followed by deleting my Oculus account as well and removing the Oculus app from my iPhone. Yes, I burned my bridges, and I voted with my feet and my wallet!

While it might be considered a bold, gutsy, and even audacious move to boycott what is likely to become one of the significant players in social VR, in a blog specifically about social VR, I am still quite comfortable with my decision four months later. As I wrote on my popular and comprehensive list of metaverse platforms:

I am DONE with Meta, and I refuse to come back unless the company reverses its decision to force its VR headset users to have accounts on the toxic Facebook social network.

Of course, that doesn’t mean that I won’t write about Meta and its social VR strategy; it’s just that I won’t be writing about it from a first-person perspective! (And I have a whole network of metaverse enthusiasts, who are not personally boycotting Meta hardware and software, to keep me reliably informed as to what’s going on in-world.)

From my onlooker, outsider perspective, Meta’s social VR strategy seems to be a bit muddled at the moment, with no less than three different social VR apps as part of their current metaverse offerings. And I’m not the only one who has noticed. Tech pundit Ben Lang tweeted yesterday:

Idea: We’re one of the biggest social network companies in the world, let’s make a social VR platform that everyone can enjoy!

Execution:

As a recent Road to VR article written by Ben, titled Meta Plans to Fuse Its ‘Horizon’ Apps & Make Them More Accessible… Eventually states:

Although all three share a common umbrella name, and even share the same avatars, they’re really entirely different applications. You might be sitting right next to your colleague in Workrooms and invite them to watch a show with you in Venues after the meeting, but there’s no seamless way for both of you to actually go from A to B without quitting your current app, launching a new one, and then eventually find each other on the other side. Not to mention dealing with an entirely different interface and features between the two.

In an interview with Digiday, Meta’s VP of Horizon, Vivek Sharma, hinted that the company hopes to eventually bring these experiences together in a more seamless way.

“Eventually, Sharma plans to stitch [the three Horizon applications] together to create a cohesive virtual world,” writes Alexander Lee. “Though he didn’t offer specifics about the timeline for this union or what the overarching platform would be called.”

“You can imagine us building out an entire ecosystem where creators can earn a living, where communities can form and do interesting stuff together,” Sharma told Digiday. “So it’s not just a place for games; it’s not just a place for people to build creative stuff; it’s all of the above.”

At present, Horizon is scattered in more ways than not being able to navigate seamlessly between apps. Accessibility is also an issue… you’ll need an Oculus Quest 2 headset if you want to be able to access all three. If you have the original Oculus Quest you can only use Worlds and Venues. If you have an Oculus Rift you can only use Worlds. And if you have a non-Oculus headset well, you’re out of luck.

Ben Lang raises an important point: everything that Meta is currently doing is constrained to run on Meta’s VR hardware. In fact, I’m not even sure how Meta plans to make Horizon Venues, Horizon Worlds, and Horizon Workrooms available to headsets like my beloved Valve Index. It will be interesting to see how—or even if—Meta tackles this issue.

If they don’t support other brands of virtual reality headsets, the utility of the Horizon line of social VR platforms is going to be limited, particularly as new competitors enter the market (like Apple, who is widely anticipated to launch a VR/AR headset sometime this year or next year).