The metaverse doesn’t exist. The term is a framework for discussions around Web 3, NFTs, decentralized virtual spaces, and the gaming landscape. Despite the fact that it does not yet exist, there has been a huge amount of money invested into the metaverse, from people purchasing virtual real estate adjacent to celebrities to building out festivals within platforms like Roblox. Despite its hypothetical state, it’s already lucrative.
There’s an early mover advantage for news and magazine publishers to launch on new platforms. While only 8% of news publishers currently say they intend to invest in metaverse products, the need to discover younger audiences and to discover new revenue sources is a powerful lure. But as we saw with the overreliance on platforms in the era of Web 2.0 — and the terrible consequences that wrought — there is enormous danger for publishers when it comes to building strategies around platforms they don’t own.
So how can publishers take advantage of the potential of the metaverse without making the same mistakes around platform over-reliance? More importantly, to what extent can media companies help define the metaverse, and take a leading role in its development?
The lure of new platforms
The appeal for news publishers is obvious. We know from recent forays into NFTs that they are hungry for new sources of digital revenue, particularly those that do not just replicate non-digital revenue strategies online. Much of the early pitch to brands of the metaverse is around selling persistent virtual products, which are being marketed as a new form of social status for particularly younger consumers.
Andrew Kiguel is CEO and co-founder of Tokens.com, which builds and sells services and real estate within the metaverse. He says, “The metaverse is the next iteration not just of gaming, but of social media. Right now, the status symbol on Facebook or Instagram is posting a picture of the restaurant or whichever resort you’re at. What’s going to be the status symbol soon in the metaverse [is] you walk around with your NFT Gucci bag or your Nike running shoes.”
The bigger draw, however, is that of creating touchpoints for new audiences. We’ve seen newspapers experiment with virtual reality spaces before, from The Wall Street Journal’s 2016 foray into VR real estate to the virtual town halls run ahead of the 2016 elections. Persistent and long-lasting communities are being built in those unreal spaces, based in no small part on lessons learned from social media and gaming. Friends lists, followers and gaming clans have formed the basis of how we will keep track of and communicate with friends and co-workers in the metaverse space.
That’s an opportunity for the news publishers who are making access to a community a big part of their offering. Start-ups like Tortoise make its community “Think-Ins” part and parcel of its marketing. And legacy titles, including The Telegraph, organize exclusive events for subscribers. The ability to open those events up to audiences who wouldn’t otherwise be able to attend is a big opportunity. We’ve already seen them experiment with these in Twitter Spaces and other remote meeting tools during the pandemic.
In addition, we’ve already seen early examples of news outlets within metaverse platforms. The Second Life Enquirer, for example, maintains a newsroom on Second Life. And other titles and magazines create their own communities from audiences already on metaverse platforms.
Decentralizing the threat
So, if the benefits for entering the metaverse space early are obvious, how do we go about building those spaces without becoming over reliant on the platforms? One of the criticisms already being levied about platforms like Roblox is that its publisher, Roblox Corporation, controls both a portion of any sale and the data of its users. That’s not tenable for media companies in 2022, who are only just rediscovering the value of their first-party data.
Instead, the media industry could look to spaces like Decentraland, which aim to build upon the promise of Web 3 by taking the power away from any one platform or owner. That, in theory, would allow them to control not just the look and feel of their own virtual environment, but also the sale and revenue options of any virtual products (or subscriptions!) sold in those spaces. As Matthew Lines writes, news is inherently linked to crypto payments already:
“Real world cryptocurrency analytics companies like Messari and Coincheckup are starting to display ‘news’ sections. These amalgamate different articles which address a specific metaverse platform and its associated crypto token. In a similar vein, websites like NFT Plazas also display an individual ‘news’ page, showcasing all the latest stories occurring in specific metaverse platforms like Decentraland.”
Dream or reality?
It’s a utopian idea, one that potentially extends a newspaper or magazines’ community far beyond geographic bounds. It also allows them to monetize audiences directly through crypto payments.
However, there are huge questions around the extent to which these decentralized platforms actually are immune to the bottleneck of control that plagued Web 2 for publishers. Between the countless current rug-pulls, crypto scams, lack of interoperability and the funnelling of funds to a handful of big players, the promise of that decentralization is under threat already.
That utopian ideal also relies on companies like Meta – whose relationship with media companies is already fraught – not seizing control of the metaverse through the scale of its investment alone. By inserting itself into the conversation as forcefully as it has, it raises the possibility that it will also try to control payments and data on its metaverse platforms as well.
Years of uncertainty
While virtual real estate is relatively cheap (and potentially comparable to the purchase of Manhattan according to Time), it is still an outlay for publishers already stretched to cover existing platforms. The BBC was recently criticized for ignoring TikTok, despite the fact that it admitted to lacking resources to do so effectively. If even the BBC can’t spread itself across the biggest social networks, can we expect most publishers to invest in an untested space like the metaverse?
Building offices in the metaverse is a nice stunt for marketing companies. But without the surety of return on investment and a lack of time to maintain it, many newspapers and magazines are adopting a wait-and-see attitude to the metaverse.
There may be huge opportunities for community development and creating audience touchpoints, but the revenue model is currently unclear. And it is likely to remain so for years. As tech giants struggle to control it, the metaverse might never even live up to its initial promise.
It is incumbent on newspapers, broadcasters and magazine companies to ensure that any forays they make into the metaverse are shored up by solid revenue and data strategies. Otherwise, it’s just a gimmick, and one that risks the industry repeating its platform-dependency from web2.0.