At this year’s Ignite conference, Microsoft officially announced that it will explore the meta-universe and revealed two new initiatives.
Original title: “Microsoft’s Metaverse Layout”
Written by: Chenglin Pua
On November 2, 2021, Microsoft’s annual technology event Ignite 2021 will open online. The conference introduced the innovative technologies, application fields and industry scenarios developed by Microsoft in the fields of metaverse, artificial intelligence, cloud computing and big data, hybrid office, digital transformation and digital security.
Microsoft Ignite 2021
Among them, it is worth noting that Microsoft officially announced its entry into the meta universe. Microsoft CEO Satya Nadella said at the Ignite online conference that Microsoft will explore meta-universe technology and join this digital world with a series of other big-name brands and enterprises. This is after Facebook (now renamed Meta) announced that it will transform into a meta-universe company in the next 5-10 years, yet another technology giant has entered the meta-universe field.
Nadella shared: “With the integration of the digital world and the physical world, we are creating a new meta-universe. In a sense, the meta-universe enables us to embed calculations in the real world and embed the real world in In computing, it brings a real sense of presence to any digital space. The most important thing is that we can bring our humanity to us and choose how we want to experience the world and who we want to interact with.”
Frank X. Shaw, vice president of corporate communications at Microsoft, also wrote in an article on the official website that Microsoft will provide power to Metaverse. Frank believes that in the past 18 months, digital technology has been at the forefront of every industry and is now more necessary than ever. The meta universe is a “persistent digital world, which is connected to many aspects of the physical world, including people, places, and things.” Microsoft now powers Metaverse, similar to the way Microsoft talked about the Internet and websites in the 1990s.
Frank wrote: “Meta Universe will be a shared experience that supports across the real world and the digital world. As companies accelerate digital transformation, Meta Universe can help people meet in a digital environment. Using virtual avatars/avatars will make meetings more comfortable. And promote creative collaboration from all over the world.”
Microsoft’s meta-universe development plan
Microsoft plans to develop Metaverse through two new initiatives.
The first initiative is called “Dynamics 365 Connected Spaces”, which provides a new perspective to help managers deeply understand how customers move and interact in retail stores, employees in factory floors, and other spaces, as well as how to optimize in a mixed working environment Health and safety management. People can interact in any space such as retail stores, factory floors, etc. through artificial intelligence-driven models and observation data.
The second initiative is called “Mesh for Microsoft Teams”, which will add a mixed reality function called Mesh to Microsoft’s existing Team function (online meeting), allowing people from different locations to join through the productivity tool Teams Collaborate, hold meetings, send information, process shared documents, etc., and share a holographic experience. This function also allows people to use personalized 3D avatars to experience an immersive space.
The beta version of the first plan will be launched in early December, while the second product will be launched in the first half of 2022.
The first product allows users to visit virtually reproduced real stores and scenes. In an interview with Bloomberg, Nadella said that they have used this product to visit the new crown ward of the hospital, the Toyota car factory, and the International Space Station.
The second product is mainly for ordinary users. The virtual experience collaboration platform Mesh is directly implanted into the existing product Microsoft Teams to improve the user’s sense of virtual experience. Microsoft said that this is only part of it. The ultimate goal of the second initiative is to combine the company’s mixed reality and HoloLens with conference and video calling capabilities, so anyone can participate.
Hardware layout
In an interview with Bloomberg TV, Nadella stated that the company’s video game device Xbox (Microsoft game device, similar to Sony’s PS5) will focus on integrating Metaverse into games on their devices in the future.
In fact, in addition to gaming equipment, Microsoft has also specially developed AR/VR related equipment, called HoloLens. Now it has been iterated to the second generation. HoloLens, is a pair of mixed reality smart glasses developed and manufactured by Microsoft.
HoloLens initially shipped on March 30, 2016, for developers in the United States and Canada, and was priced at $3,000 at the time. Since then, companies such as Samsung and Asus have also successively proposed to Microsoft to cooperate with Microsoft to produce related peripheral mixed reality products around HoloLens. On October 12, 2016, Microsoft announced that HoloLens is available for purchase worldwide.
HoloLens 2 was released on February 24, 2019 at the Mobile World Congress (MWC) in Barcelona, Spain, with a pre-sale price of US$3,500.
Microsoft HoloLens device
However, compared with virtual reality related products on the market, the disadvantage of Microsoft HoloLens lies in the high price. For example, Meta’s latest Oculus Quest 2 launched in 2020 is priced at only $299, which is less than one-tenth of Microsoft’s HoloLens. And the resolution of Oculus Quest 2 is 1832×1920 per pair of glasses (roughly equivalent to 4K high quality). It can be said that Oculus Quest 2 of Meta Company has a great advantage in terms of cost performance. Oculus Quest 2 has also been rated as the most worthy virtual reality device for foreign authoritative evaluation websites.
Microsoft needs to improve the cost-effectiveness of its products so that it can occupy a place in the virtual reality product market. In addition, it is rumored that Apple is also actively researching virtual reality equipment, which is expected to be launched in 2022. Apple, which is good at combining soft and hard, will enter this field in the future and is bound to be a formidable opponent.
Market share of virtual reality equipment, source: Counterpoint’s global virtual reality equipment report
Improve social experience
Microsoft Teams will launch a new 3D avatar/avatar to promote the development of the meta-universe environment. Users do not need to wear a VR headset to use them. These avatars can represent the user in 2D and 3D meetings. If they don’t want to open the webcam, they can choose the animated version of the virtual avatar/avatar.
Jared Spataro, vice president of Microsoft Teams, said: “Nowadays, people face a dilemma when participating in digital conferences. They have to choose whether to turn on the camera or turn off the camera. Turning on the camera means you are standing in the front and in the middle, and people will see you. Every move. Turning off the camera means that you will hardly make any social actions, and it’s hard to give people the feeling of being fully engaged in the meeting.”
This also leads us to wonder if the colleague who turned off the video and kept it mute actually participated in the meeting. Microsoft’s Human Factors Lab has simulated these situations, and they found that this situation makes people feel physically and mentally exhausted and stressed. They also found that when you have an avatar or profile picture, 70% of meeting participants feel that that person is present. Kipman said: “Choose Microsoft’s 3D avatar, you will be able to project your own body language, and map your movements through a webcam or other means. It does not necessarily need to open the camera to cause stress.”
These avatars or avatars can mimic facial expressions. Kipman said: “You need to be able to present yourself in a real way, which includes frowning and expressing anger. Because as a business and emotional construct, it is important that the avatar represents you in the most authentic way possible.”
Microsoft will use artificial intelligence (AI) to listen to the user’s voice, and then animate the user’s avatar/avatar. If you switch to a more immersive 3D meeting scene, these animations will also include the hand that raises your avatar when the user clicks on the raise hand option, or make animated emojis around your avatar. Immersive space is where Microsoft thinks this Mesh integration is most useful, especially in the construction of meta-universe.
Participation of avatars and avatars
Microsoft said that Teams is expected to start using these avatars or avatars in the first half of 2022. Microsoft’s goal is that by the first half of next year, users will be able to enter the immersive virtual space. The meta-universe vision previously announced by Meta has certain similarities with the platform that Microsoft demonstrated. Users can create their own 3D brand space on these two platforms, and people’s avatars are both cute and cartoon.
In addition to the addition of 3D avatars, Microsoft has also added support for translation and transcription. Users can meet with colleagues from all over the world in the virtual Teams space, reducing language barriers. Users can also share Microsoft Office files in the virtual space, allowing users to generate value in the virtual space.
It can be seen that Microsoft is actively improving the experience of Metaverse. Today’s sense of experience is a shortcoming of the meta-universe, and improving the sense of experience of the meta-universe can help increase people’s willingness to participate in the meta-universe. Microsoft believes that presence, talking with people, eye contact, and reaction will all be crucial in social interaction; and improving the sense of social interaction can add many advantages to Microsoft’s meta-universe.
The infinite possibilities of the meta universe
Microsoft believes that Metaverse is “the pinnacle of intelligent cloud and intelligent edge.” Its essence lies in building a digital world that is permanently and steadily connected to the real world. Metaverse will enable elements such as people, objects, and fields in the physical world. Share experience with the digital world. For example, in the process of accelerating the digital transformation of enterprises, Metaverse allows people to meet in a digital environment, using digital avatars and more creative collaboration methods, allowing people to communicate with each other more freely from all corners of the world.
The definition of meta-universe and the content it contains vary from stakeholder to stakeholder, but it is undeniable that the competition is becoming more and more fierce because of its infinite possibilities. In fact, a few days after Facebook changed its name to Meta, Microsoft promoted the establishment of a meta-universe within Teams.
The CEO of “All in” Meta Universe’s Meta company, Zuckerberg, once answered a question about Meta Universe’s revenue opportunities during the 2021 second quarter earnings conference call. He said: “I think digital products and creators will be very powerful. People will express themselves through their avatars, digital clothing, digital products, and the applications they own, bringing them from one place to another. Business will It is an important part of Metaverse. You will be able to sell physical and digital products at the same time.”
The liquidity of Meta Universe lies in the construction of a trading market, from which a certain percentage of commissions are drawn. Humans can experience what the real world can do in the mature meta-universe; they cannot experience the real world, and they can also realize or experience in the meta-universe. According to this logic, the economy of a mature meta-universe will be greater than the economy of the real world. This gives unlimited imagination.
A growing market
On November 1, 2021, Microsoft announced its latest quarterly financial report. The financial report shows that in the three months ending September 30, 2021, Microsoft’s revenue reached US$45.32 billion, a year-on-year increase of 22%; net profit was US$20.51 billion, a year-on-year increase of 48%. Among them, game business revenue increased by US$501 million over the same period last year, an increase of approximately 16%.
Driven by the new generation console Xbox Series X/S, Microsoft’s Xbox hardware revenue increased by 166% year-on-year. The revenue growth rate of Xbox-related content and services has been relatively slow, with an increase of only about 2% over the same period last year. Microsoft stated in its financial report that this was mainly due to “strong performance last year” and the growth of Xbox Game Pass subscription services and first-party games was offset to some extent by the decline in revenue from third-party games.
Last year, driven by the epidemic, the “home economy” game industry experienced a round of growth. In the previous Microsoft financial report, the number of Xbox Game Pass subscribers increased by 37% in the year ending June 30, 2021, but it failed to meet the target (48%) previously set by Microsoft. Although it did not meet Microsoft’s expectations, it also shows the rapid growth of the gaming industry.
Microsoft’s growing gaming business
The meta universe has both social and gaming attributes. The game market is still a fast-growing big cake. A Newzoo report on the gaming industry pointed out that by 2022, consumer spending on games will grow to 196 billion U.S. dollars, with a compound annual growth rate of +9.0% from 2018 to 2022.
The rapid growth of the game market, source: Newzoo report
Meta Universe is able to integrate games and social interactions, which also makes the giants extremely optimistic about the future of Meta Universe and begin to lay out the huge market that will be generated in the future. The Bloomberg industry research report predicts that Metaverse will reach a market size of US$800 billion in 2024, and PricewaterhouseCoopers predicts that the market size of Metaverse will reach US$1.5 trillion in 2030. The huge industry potential has prompted Microsoft to want to eat this big cake.
