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The metaverse has taken a backseat in the past few years as shinier technologies like artificial intelligence (AI) have taken over the headlines. However, the sector continues to grow, and according to one report, it will be a $1.2 trillion market by 2033.
According to the report by Brainy Insights, a Pune, India-based market research company, the metaverse market was worth $62.22 billion in 2023. The report credited the COVID-19 pandemic with fuelling the growth of the technology through the rise of remote working and interactive distance learning.
The post-COVID period witnessed accelerated growth for the metaverse as some of the biggest companies battled to dominate the new frontier. Meta (NASDAQ: META) was the biggest entrant, with Mark Zuckerberg announcing a pivot from a purely social media model to focus on the new tech, complete with a name change.
Zuckerberg predicted that the metaverse would reach a billion people over the next decade, host hundreds of billions in digital commerce, and give jobs to millions of content creators. Microsoft (NASDAQ: MSFT) Founder Bill Gates was just as optimistic, predicting in 2021 that over the next three years, “most virtual meetings will move from 2D camera image grids to the metaverse, a 3D space with digital avatars.”
Meanwhile, Omniscape CEO and Co-Founder Robert Rice believes that the metaverse is well positioned to mature in the next six months.
“[Metaverse] is not just [about] VR, it’s not just AR. We’re like the only industry that can encompass every other industry [like AI and blockchain],” Rice told CoinGeek Weekly Livestream. “So now that AI is kind of percolating down, it’s still hot, but now metaverse is kind of coming back… Again, when you have these huge hype things, people just throw money at whatever with no real substance to it; it goes away. But people who are actually building stuff are keeping their heads out of the craziness; we almost always survive, and now it’s our time to hit the hockey stick.”
The Brainy Insights report found North America dominates the sector and will lead in the forecasted period. The region is home to key market players, boasts a more robust infrastructure, and has the most favorable regulatory conditions.
In the metaverse industry, the software segment is the largest, with a 35% market share in 2023. Augmented reality is the dominant technology ahead of virtual and mixed realities.
Gaming has continued to dominate the metaverse and is unlikely to be dislodged over the next decade, the report found. Even before the blockchain-powered metaverse blew up globally, gamers were already engaging in immersive digital worlds through VR headsets, making the transition easier for them.
Media and entertainment are the next largest sectors for the metaverse, with a 20.11% market share in 2023.
While high development costs remain a challenge, the report predicts that the expansion of the metaverse beyond entertainment offers massive room for growth. The technology is now being used in education, healthcare, remote work, tourism, aerospace, and more.
The use of the metaverse in more critical sectors comes with the risk of cyber attacks, which could hinder the technology’s growth, the report acknowledged.
Watch Metaverse is going to change the world as we know it: Dereck Hoogenkamp
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