Disney drops metaverse division, EU seeks rules for virtual worlds, and other metaverse stories you need to read this month

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum.

Author: Cathy LiHead, Shaping the Future of Media, Entertainment & Sport; Member of the ExCom, World Economic Forum

• his regular round-up brings you a selection of the latest news and updates on the development of the metaverse.
• Top metaverse stories this month: Disney shuts down its metaverse unit; EU seeks feedback on possible metaverse rules; Meta plans to use AI in the metaverse.

1. Disney drops its metaverse division

Walt Disney is shutting down its division for developing metaverse strategies. The closure of the 50-person team – known as the Next Generation Storytelling & Consumer Experiences unit – is part of a wider restructuring that is expected to lead to 7,000 job losses in the next two months.

The metaverse division was “tasked with finding ways to tell interactive stories in new technological formats using Disney’s extensive library of intellectual property”, according to The Wall Street Journal. Disney’s work in the metaverse has included patenting technology to create virtual theme parks.

However, The Wall Street Journal says that companies such as Disney appear to be becoming frustrated by slow growth in metaverse-user numbers.

The metaverse has 520 million active users per month, according to the latest figures from metaverse consulting company Metaversed. This means user numbers have risen by just 25 million this year, compared with an increase of around 43 million in the same period last year.

2. EU seeks input on possible metaverse regulations

The European Commission is seeking feedback on its proposals to develop rules to manage virtual worlds such as the metaverse.

After we reported last month that EU antitrust chief, Margrethe Vestager, had called for more regulatory scrutiny of the metaverse, the Commission has released a “call for evidence” on what legislation around the metaverse should look like.

“There is a risk of having a small number of big players becoming future gatekeepers of virtual worlds, creating market entry barriers and shutting out EU start-ups and SMEs [small and medium-sized enterprises] from this emerging market,” the document says.

“Such a closed ecosystem with the prevalence of proprietary systems can negatively affect the protection of personal information and data, the cybersecurity and the freedom and openness of virtual worlds.”

The Commission says its aims include ensuring that:

• metaverse users have the freedom to choose how and when to use their digital identity, data and assets;
• virtual worlds are safe, sustainable and fair, and that they can be used to improve the sustainable competitiveness of real-world industries;
• the skills needed to develop the required technologies are nurtured, and structures are put in place to ensure foresight of key technology developments.

The Commission is taking feedback until 3 May.

3. News in brief: Top metaverse stories this month

Meta’s new generative AI team will put the technology to use in the metaverse, Chief Technology Officer Andrew Bosworth told Nikkei. “In the future, you might be able to just describe the world you want to create and have the large language model generate that world for you,” he said. “It [will] make things like content creation much more accessible to more people.”

Meta also plans to cut another 10,000 jobs this year, but the firm’s Head of Global Affairs, Nick Clegg, insists Meta will stick with the metaverse. “All the early evidence suggests that something like this will be the heart of the new computing platform,” he said. “But it’s going to take a while.” The company’s metaverse-oriented Reality Labs unit lost $13.7 billion in 2022.

An increasing number of companies are looking to the metaverse as a way to improve customer relationships, according to Harvard Business Review. It says the metaverse can create new ways for customers to discover and explore products, and allow firms to offer increased levels of personalization in customer interactions.

Microsoft sees corporate customers rather than consumers as a way to boost its augmented reality (AR) business, according to Bloomberg. There are potential opportunities for its HoloLens headset to be used in medical education and engineering. And AR systems could have extensive applications in military training.

Platform – Do not Edit

How is the World Economic Forum contributing to the metaverse?

The World Economic Forum explores the potential of the metaverse in several ways, with key focuses on governance and value creation and the development of its own metaverse, the Global Collaboration Village.

Our Defining and Building the Metaverse Initiative seeks to guide the development of a safe, interoperable and economically viable metaverse, by uniting stakeholders from various sectors, including government, academia, business, and civil society.

It does so via two interrelated tracks: metaverse governance and value creation. Both tracks take an ethical, forward-thinking approach and work collaboratively to balance governance with economic and social opportunities.

Explore our Defining and Building the Metaverse Initiative.

The Global Collaboration Village is the first global, purpose-driven metaverse platform. Pioneered by the Forum, and in partnership with Microsoft and Accenture, it seeks to enhance more sustained public-private cooperation and spur action to drive impact at scale.

Inclusive and responsible by design, the Global Collaboration Village is a creative place to imagine alternative futures, explore ideas and systems transparently and safely, and envision what the future of engaging multistakeholder collaboration could be.

Learn more about the Global Collaboration Village

Real estate prices in the metaverse have sunk in the past year, according to data from WeMeta, which monitors land sales for various metaverse platforms. The median sale price for land in Decentraland has dropped by 85%, from $8,923 on 22 April 2022 to $1,279 on 3 April 2023. Prices in The Sandbox are down from $6,203 to $1,461 over the same period, a fall of 76%.

Sony’s sales of its latest VR headset could fall below the firm’s target, Bloomberg reports. The company is likely to sell about 270,000 units of the PSVR2 between its release in February 2022 and the end of March 2023, leaving it 10% below a goal of 300,000. The headset is a key part of Sony’s plans to build a metaverse equipped for more than just video games.

4. More on the metaverse on Agenda

Could the metaverse help predict and produce movie blockbusters? This blog discusses how metaverse rehearsals could be used to spot potential tweaks to a film’s plot and anticipate audience reactions.

Even the latest lightweight virtual reality (VR) headsets can be tiring to use, says Jeremy Bailenson, Founding Director of the Virtual Human Interaction Lab at Stanford University. He says we should focus on using VR only in settings where it can be invaluable, such as in medical and emergency service training situations.

Blockchain-powered decentralized digital ID can provide privacy-enhancing capabilities. This is different to current centralized systems, which are more vulnerable to personal data exploitation and massive data breaches.