What is the metaverse, and who will build it?

It could be the internet's 3D future, but the metaverse has a long way to go before its potential is realised.
Written by Charles McLellan, Senior Editor
Image: XH4D / Getty Images

The virtual world is increasingly encroaching on the real one, via fully immersive virtual reality (VR) headsets for gaming and a growing number of business use cases, augmented reality (AR) devices that overlay digital information on the real world, and mixed reality (MR) environments, where you can interact with digital objects within your real-world surroundings. 

These technologies and their developing successors, collectively known as extended reality (XR), are coalescing – along with other building blocks such as blockchain, cryptocurrencies and NFTs, artificial intelligence, 3D design, holography, IoT, 5G and 6G, cloud and edge computing – into the concept of the 'metaverse', which can be thought of as the entirety of the resulting immersive internet experience, once all the pieces are connected. 

In many ways, the metaverse is the next, 3D version of the web and is based on many of the same technologies as Web3, with a similar decentralised, user-driven focus.

A glance at Google Trends shows that 'metaverse' is very much the new kid on the block, with a dramatic boost in search interest around the time (Oct 28, 2021) that Facebook renamed itself Meta.

Google Trends: AR, VR & Metaverse
Data: Google Trends / Chart: ZDNET

So, how big is this metaverse going to be, who will its denizens be, and who will build it? 

The metaverse market

Clearly the metaverse doesn't exist yet even if big tech companies are racing to make it happen. That means putting up numbers for revenue, or anything else, is hard. Management consultant firm McKinsey in a recent report, estimated that the metaverse could generate $4-$5 trillion across consumer and enterprise use cases by 2030. 

McKinsey: Metaverse market in 2030
Image: McKinsey

Despite all this optimism, it's important to recognise that we're very much at the start of this journey. According to McKinsey, sectors leading the way on metaverse adoption include energy & resources, high tech, media & entertainment, and automotive, machinery & assembly, while laggards include construction and transport & logistics. 

McKinsey: Metaverse adoption by sector
Image: McKinsey

Meanwhile, in its 2022 Hype Cycle for Emerging Technologies, analyst Gartner identified 'Evolving/expanding immersive experiences' as a key theme, placing metaverse in the early-stage Innovation Trigger phase with a horizon of 'more than 10 years' before maturity (the Plateau of Productivity) is reached. 

Gartner: Hype Cycle for Emerging Technologies 2022
Image: Gartner

What the surveys say

In its Value creation in the metaverse report, McKinsey says it expects the average internet user to spend up to six hours a day in metaverse experiences by 2030, which is a thought-provoking prediction. Clearly a lot of development needs to happen between now and the end of the decade to get the user experience up to this level.

To get an idea of the current state of adoption in two key metaverse components, VR and AR, we can examine a recent survey from Computer Economics (a service of Avasant Research).

Canvassing 212 IT organisations worldwide between November 2021 and February 2022, the Technology Trends 2022 survey asked about tech adoption plans for the period up to H2 2023, as well as ROI (return on investment), TCO (total cost of ownership) and customer satisfaction.

Computer Economics used the responses to characterise the relative maturity and relative risk associated with the 14 technologies covered in the survey. 

Computer Economics: AR/VR maturity & risk-reward
Images: Computer Economics (red highlights by ZDNET)

VR and AR trailed the field on maturity, located in the low investment/low adoption sector (above, left). According to Computer Economics, "Virtual and augmented reality still suffers from form factors being clumsy and often tethered to larger machines. However, the technology is getting easier to use. We expect it to grow as this happens."     

When it comes to risk/reward (above, right), VR and AR are in the low risk/moderate reward sector. "With AR/VR technologies, cost is predictable, but ROI is sometimes difficult to measure or is unclear," the report said. 

The news on customer satisfaction wasn't great either, with just HR/HCM (human resources/human capital management) systems getting a lower rating. 

Computer Economics: AR & VR customer satisfaction
Image: Computer Economics (red highlight by ZDNET)

An April 2022 survey conducted by Agora, which develops APIs for embedding real-time video and voice into applications, canvassed 300 US-based developers for their views on the metaverse. Key findings were:

  • Data privacy and security were the biggest hurdles the metaverse has to overcome (33% of respondents).
  • Gaming and entertainment will benefit the most or experience the greatest positive impact from the metaverse (26% each).
  • More than half (55%) of respondents think the metaverse is likely to replace real-life, in-person social interactions in the next five years.
  • A majority (53%) of respondents believe NFTs will become the biggest metaverse currency in the near term, and 57% think the metaverse will become the most popular place to buy, store and trade cryptocurrency.
  • Cryptocurrency and blockchain technology advancements will be critical to shaping the future of the metaverse, according to 70% of respondents.
  • More than half (55%) of respondents think that Meta (formerly Facebook) will come to 'own' the metaverse, followed by Google (9%), Microsoft (7%), Apple (6%) and Amazon (5%).
Agora survey: metaverse-hurdles
Image: Agora

There's clearly a lot to play for in the VR/AR and metaverse space, although current implementations leave plenty to be desired. That's why many players – including the biggest tech companies on the planet – are getting involved. Let's look at the current situation.

Key metaverse vendors and products 

McKinsey breaks the metaverse into 10 layers that fall into four core categories: Content and experiences; Platforms; Infrastructure and hardware; and Enablers. 

Content and experiences 

  • Content from first parties, developers, creators and users that "enriches the metaverse experiences".

  • Applications tied to specific metaverse use cases, such as collaboration. 

  • Virtual worlds where users can gather, interact and create. 


  • Access and discovery platforms such as search engines and app stores that facilitate distribution and discovery of content. 

  • Creators/3D development platforms for building 3D experiences. 

Infrastructure and hardware  

  • Devices, OSs and accessories that make up the human interface layer. (Today, devices are mostly PCs, laptops, smartphones or head-mounted displays. In the future, the metaverse may be accessed via smart contact lenses or even brain-computer interfaces.) 

  • Infrastructure – the compute, networking and storage resources that power the metaverse.  


  • Security, privacy & governance, including content moderation platforms. 

  • Identity platforms that manage digital identity, avatars and social graphs. 

  • Payments & monetization – platforms and tools to enable the metaverse economy. 

Here are some leading metaverse companies assigned to these layers. It's by no means an exhaustive list, but what's clear is that there are multiple companies jostling for position in various segments, which suggests that we're likely to see significant M&A activity as the market matures.




 Content & experiences


AltspaceVR (Microsoft) • Amazon AR ViewAWS Cloud Quest • DXC Virtual WorldHorizon Workrooms (Meta) • Mesh for Microsoft TeamsMesh App for HololensNth floor (Accenture/Microsoft) • Project Starline (Google) • Roblox Education • Vive Sync (HTC)


Virtual worlds 

DecentralandHorizon Worlds (Meta) • Second Life (Linden Lab) • The Sandbox (Animoca Brands) • Roblox 


Access & discovery 

Amazon AppstoreApple App StoreEpic Games StoreGoogle Play StoreHuawei AppGallerySamsung Galaxy Apps


Creators/3D development platforms 

Adobe • AppleAutodesk • Azure Digital Twins (Microsoft) • MatterportMetaVRse • Nvidia OmniverseRoblox StudioSnapdragon Spaces (Qualcomm)• TiMi Studio Group (Tencent) • Unity (Pro, Plus, Plastic SCM Cloud Edition) • Unreal Engine (Epic Games)

Infrastructure & hardware 

Devices, OS & accessories

AppleEpson (Moverio) • Google (+ Project Starline) • HP (Reverb) • HTC (Vive) • IntelLenovo (ThinkReality) • Magic LeapMeta (Quest) • Microsoft (Hololens) • Pico • QualcommSamsungSony (Playstation VR) • Varjo



Alibaba CloudAmazon Web ServicesGoogle Cloud PlatformMicrosoft AzureNvidia CloudXR • Oracle Cloud


Security, privacy & governance 

Arkose LabsCloudflare• DAO (Decentraland) • Hub SecurityMetaverse Standards Forum • ReasonLabs • Roblox Community Standards



BerbixDocuSign IdentifyEuropean Digital Identity WalletsID.meJumioPiplShufti ProTrulioo 


Payments & monetization 

Animoca BrandsBinanceEthereum (NFTs) • MANA (Decentraland) • OpenSeaRobux (Roblox) • SAND (The Sandbox) • ShopifyTiliaUnity (Ads) 

Which are the leading metaverse companies in 2022? After examining a sample of recent articles on the subject, we found that these were mentioned most often:

Leading metaverse companies
Data & chart: ZDNET

Let's take a look at the top six metaverse companies on the list (with eight or more citations in our sample). 

The canonical metaverse company is the one that renamed itself after the concept – Meta, the Big Tech company formerly known as Facebook. Having spent $10 billion on metaverse development in 2021 and working to a 10-15-year timeline, Meta's current portfolio is built around the Meta Quest 2 VR headset, the Horizon Worlds social VR platform, and Horizon Workrooms, a virtual collaboration space. The company unveiled its next high-end VR headset, Meta Quest Pro, at the Meta Connect 2022 conference on October 11, as well as announcing updates to Horizon Worlds and Horizon Workrooms, plus a series of new partnerships.

With 58.5 million daily active users in over 180 countries (as of September 2022), Roblox is a leading metaverse player that has seen rapid growth during the COVID-19 pandemic. Roblox provides a platform, Roblox Studio, for creating online games (or 'experiences', as the company prefers), of which there are over 30 million, the company says. Roblox users, who mostly fall into younger (under 24) age groups, can make in-game purchases using the Robux currency, while developers can make money via the Developer Exchange. According to Roblox, 2.7 million people earned Robux in June 2022, and over $580 million was paid to developers in the 12 months ending June 30, 2022. 

Microsoft's metaverse strategy encompasses two main spheres. One is 'industrial', using platforms such as Azure Digital Twins to model real-world entities digitally, link them to their physical counterparts via IoT sensor inputs, and then analyse the resulting data flows to extract insights. The other covers the future of work, and is built around Mesh for Microsoft Teams, which includes avatars (currently waist-up only), virtual meetings and drop-in spaces that aim to recreate 'watercooler moments' in virtual form. These metaverse elements can be accessed via headsets such as Microsoft's Hololens, as well as more mundane devices, such as PCs, tablets and smartphones.   

The metaverse is all about high-quality 3D spaces, and Unity is a leading game engine developer with ambitions to branch out beyond gaming to embrace all manner of virtual worlds and applications. In August, for example, Unity announced a partnership with Microsoft to use Azure as its cloud partner for building and operating real-time 3D (RT3D) experiences with the Unity engine. There are multiple Unity products and services for 3D developers, including Unity Pro, Game Server Hosting, Unity Plus, Plastic SCM Cloud Edition and Unity Ads.   

Graphics, AI and high-performance computing is a mix that's tailor-made for the metaverse, and Nvidia is staking its claim in this space with Nvidia Omniverse. A multi-GPU scalable platform for creating virtual worlds based on Pixar's USD (Universal Scene Description) standard and Nvidia's RTX ray-tracing and AI technology, Omniverse offers multiple tools, apps and plugins that creators can use to build virtual worlds. According to the company, in August 2022 around 700 companies around the world were using Omniverse to "enhance architectural and product design, simplify visual effects workflows and build digital twins of factories, cities and the planet".   

A virtual social platform powered by the Ethereum blockchain, Decentraland is built, owned and governed by its user base. It has its own system of virtual property (LAND), its own cryptocurrency (MANA) and its own smart-contract-powered governance system (DAO). You can buy parcels of LAND using MANA, create 3D environments, applications or games, and trade Decentraland assets in the Marketplace. The lack of centralised control implicit in its name sets Decentraland apart from, for example, Second Life.


Even a brief tour of 'the metaverse' as it exists in 2022 reveals a lot of moving parts, including multiple platforms, virtual worlds and applications, plus a developing ecosystem of services covering digital identity, security, privacy and monetisation.

As the concept and its execution matures, it's likely that any metaverse market shake-out will leave the usual Big Tech suspects – Meta, Microsoft, Google, Amazon – in the driving seat. Whether other current contenders, notably Nvidia, will be able to leverage the growing metaverse market to gain a place at the top table remains to be seen. Then of course, there's Apple waiting in the wings.

Also up for grabs is whether 'the metaverse' will remain a collection of separate virtual worlds or evolve into a more open, standards-based and interoperable environment, as envisaged by the Metaverse Standards Forum, which launched in June 2022. Whichever model comes to dominate, it's clear that the future of communication and collaboration will be different: in December 2021, Bill Gates predicted that within two or three years most virtual meetings will move from 2D camera image grids to the metaverse – "a 3D space with digital avatars".

In a separate article, we'll explore what the current experience of an avatar meeting in a virtual 3D space is like.


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