“Phygital convergence” refers to the blending of physical (phy-) and digital (-gital) experiences to create an ecosystem where users can move seamlessly between online and offline worlds. This term and concept represent a new frontier in retail, technology, and other sectors, where businesses are looking to offer an enhanced user experience that integrates the best of both worlds.

As we step into stores equipped with Augmented Reality (AR) mirrors that suggest outfits based on personal preferences or scroll through apps that allow us to visualize how furniture would look in our homes before purchasing, we actively participate in a phygital ecosystem. These innovations are more than mere technological advancements; they represent a paradigm shift in how we interact with the world around us, merging the tactile satisfaction of the physical with the limitless possibilities of the digital.

Yet, the concept of phygital convergence extends beyond consumer experiences, permeating industries such as healthcare, where telemedicine combines in-person consultations with digital follow-ups, or education, where physical classrooms are enriched with virtual reality expeditions to distant lands and historical epochs. This convergence promises a harmonized existence where the digital complements the physical, offering enriched, personalized, and immersive experiences that were unthinkable just a few decades ago.

But as we forge ahead in this brave new phygital world, it is incumbent upon us to navigate the complexities and challenges that arise from this convergence. From safeguarding privacy and fostering security to ensuring equitable access and understanding the ethical implications, the phygital frontier is rich with opportunities and laden with challenges.

The Digital Experience

In the evolving landscape of phygital convergence, the digital experience stands as a pillar of innovation, crafting realities that intertwine the virtual and the real in seamless harmony. Today, the digital realm is no longer confined to screens; it extends into our physical environment, offering enriched experiences that leverage data, artificial intelligence, and immersive technologies to redefine our perception of reality.

Personalization at its Peak

One of the notable trends in the digital experience is the heightened level of personalization that new technologies afford. Businesses can tailor experiences to individual preferences, leveraging data analytics and AI to understand consumer behaviors and preferences deeply. Imagine walking into a store where AR glasses instantly highlight products based on your purchasing history and preferences or a virtual shopping assistant who understands your style and budget, guiding you through a curated selection of items.

Immersive Environments

Immersive technologies such as virtual reality (VR) and augmented reality (AR) have transformed the digital experience, transporting users to meticulously crafted virtual environments or enhancing the physical world with digital overlays. In the educational sector, students can take virtual field trips to historic sites or scientific laboratories, providing a level of engagement and immersion that traditional methods cannot match.

Seamless Integrations

Phygital convergence is marked by seamless integrations that fuse the physical and digital worlds naturally and intuitively. Smart homes are a testament to this, where digital interfaces allow for seamless control over physical appliances, creating an integrated ecosystem that responds dynamically to the inhabitant’s preferences and habits.

Accessibility and Inclusivity

The digital experience in the phygital world is also characterized by a commitment to accessibility and inclusivity. Assistive technologies can now be integrated more naturally into physical environments, facilitating experiences that are inclusive and accessible to all. For instance, apps that leverage AR to assist individuals with visual impairments navigate their surroundings or educational platforms that adapt to different learning styles to cater to a broader spectrum of students.

The Challenge of Ethical Considerations

As we forge ahead, we cannot ignore the ethical dilemmas that the digital experience poses. Issues of privacy, consent, and data security stand at the forefront. The potential for deepfakes and other manipulative technologies raises concerns about authenticity and trust in the digital space. It is a continuous endeavor to foster environments that are secure and respectful of individual rights.

The Physical Experience

The physical experience in the age of phygital convergence is a rich tapestry of sensory engagements, interactive spaces, and genuine interactions woven with threads of well-being. As we advance further into this integrated era, it remains crucial to cherish and preserve the essence of our tangible realities while harmoniously merging them with digital enhancements. It’s a delicate balance of honoring our innate human connection to the physical world while embracing the boundless possibilities that digital integrations offer.

Sensory Engagement

The physical experience is rooted in sensory perception. Touch, taste, sight, sound, and smell are the gateways to our connection with the external environment. Innovative businesses and designers are finding ways to enhance these sensory engagements. Think of smart textiles in fashion that change texture based on external stimuli or restaurants that use scent diffusion to enhance the taste and ambiance of their culinary creations.

Interactive Environments

Physical spaces are being reimagined to be more dynamic and interactive. From retail stores with interactive displays that respond to a shopper’s touch or motion to urban spaces equipped with smart benches that provide wireless charging, the line between static and dynamic is blurring.

Enhancing Real-world Interactions

While digital interactions can be replicated and scaled, real-world interactions possess a unique, unrepeatable charm. Events, workshops, and live performances are being augmented with digital elements to provide a richer experience. For instance, concerts might incorporate AR elements visible through smartphones, adding a layer of immersion to the live performance.

Health and Well-being

The physical realm also intersects with our well-being. Gyms and wellness centers now incorporate wearables and other digital tools to provide users with real-time feedback on their workouts. Similarly, urban spaces are designed considering not just functionality but also how they contribute to their inhabitants’ mental and physical well-being.

The Challenge of Authenticity

With the surge of digital integrations in physical spaces, there’s a risk of diluting authentic physical experiences. While a museum might benefit from AR integrations, it’s crucial to ensure that digital enhancements don’t overshadow the actual artifacts. Striking a balance between the authentic and the enhanced becomes essential.

The Convergence

As we steer into the modern era, we are witnessing an unprecedented amalgamation of the physical and digital worlds, forging a rich tapestry of experiences that are both immersive and grounded in reality. The phenomenon of convergence is not just a technological trend but a societal shift, promising to redefine how we interact with our surroundings, with each other, and even with ourselves. Let us delve deeper into the intricate landscape of convergence.

Technology Harmonization

The marriage of technologies from diverse domains has been instrumental in steering the wave of convergence. We witness this in the seamless interplay between hardware and software in modern gadgets, where Artificial Intelligence, the Internet of Things (IoT), Augmented Reality (AR), and Virtual Reality (VR) come together to create enriched experiences that are both tactile and virtual.

Business Innovations

Convergence has fostered innovation in business models and strategies. Companies are harnessing the power of data and analytics, coupled with physical touchpoints, to offer personalized products and services. Retail spaces are evolving into experience centers where consumers can interact digitally with physical products, erasing the boundaries between online and offline shopping.

Education Transformation

The education sector stands revolutionized with a blended learning approach, harmonizing physical classrooms with digital tools and platforms. This hybrid model facilitates a richer learning experience, incorporating virtual labs, digital libraries, and interactive online sessions, bridging geographical gaps and fostering a global learning community.

Healthcare Revolution

Healthcare is undergoing a radical transformation, with telemedicine bridging the gap between doctors and patients, bringing medical consultations to the comfort of one’s home through digital mediums. Furthermore, wearable tech monitors health metrics in real-time, allowing for a comprehensive approach to health management that is both physical and digital.

Urban Planning and Infrastructure

Convergence has permeated the realm of urban planning, birthing smart cities that are an integration of physical infrastructure with digital networks, enhancing efficiency and sustainability. From intelligent traffic management systems to digital public services, the cities of tomorrow promise a convergence of physical space with digital intelligence.

Socio-Cultural Shift

Beyond the technological and commercial spheres, convergence has facilitated a shift in socio-cultural dynamics. Digital platforms have cultivated communities that transcend physical boundaries, fostering connections and dialogues that are reshaping societal norms and perspectives, blending the physical with the virtual in the social fabric.

The Philosophical Angle

Lastly, convergence brings forth a philosophical dialogue, instigating a contemplation on the nature of reality in a phygital world. It presents a future where the lines between the real and the virtual are blurred, invoking questions on identity, existence, and the essence of being in a converging world.

The Benefits and Challenges of Phygital Convergence

As we march steadily towards a future orchestrated through the lens of phygital convergence – a seamless blending of the physical and digital worlds – we find ourselves amidst a vortex of opportunities and impediments. This harmonization of realms promises to foster innovation and reshape experiences while presenting new challenges to navigate. Let’s dissect the multi-faceted impacts of phygital convergence:

Benefits

• Enhanced User Experience – Phygital convergence allows for an enriched user experience by bringing together the tangible and intangible, offering an immersive, interactive, and personalized engagement with products, services, and information.
• Operational Efficiency – Companies can leverage data analytics from digital platforms to streamline operations in the physical space, achieving heightened efficiency and effectiveness in business processes and decision-making.
• Innovation and New Opportunities – The phygital landscape is fertile ground for innovation, birthing unprecedented products, services, and business models while opening doors to fresh market opportunities and niches.
• Access and Inclusion – By merging digital functionalities with physical infrastructures, we can extend services and opportunities to remote and underprivileged areas, fostering inclusivity and equal access.
• Sustainability – Smart systems and IoT devices within a phygital ecosystem can enable more sustainable practices through intelligent resource management and energy-efficient solutions, promoting a greener future.

Challenges

• Security Concerns – The proliferation of digital elements in the physical sphere elevates the risk of cyber threats, including data breaches and hacking, demanding fortified security measures.
• Complexity and Integration Issues – Merging digital technology with physical components can lead to complex systems, raising concerns over integration issues, interoperability, and the potential for technical glitches.
• Digital Divide – While phygital convergence aims to foster inclusivity, it can also exacerbate the digital divide, isolating individuals and communities lacking digital literacy or technology access.
• Privacy Invasion – The integration of digital technology into everyday life, coupled with data analytics, presents the peril o
• Over-Dependence on Technology – A phygital world risks breeding an over-dependence on technology, potentially stifling human innovation and creativity while fostering a society detached from real, tactile experiences

Final Thoughts

As we traverse the phygital frontier, it is imperative to navigate with a discerning eye, seizing the myriad opportunities while safeguarding against potential pitfalls. The phygital convergence presents a dynamic tapestry of benefits, offering a canvas of innovation, efficiency, and inclusivity. However, it demands cautious optimization to mitigate security, privacy, and the digital divide challenges.

Phygital convergence is not merely a technological advancement; it is the harbinger of a new age of interconnectedness, where the boundaries between the real and the virtual are not just blurred but harmoniously intertwined, fostering a space of creativity, innovation and boundless potential.

Yet, it necessitates a delicate balance, a harmony of progression and preservation. In our relentless pursuit of innovation, we must cherish and uphold the irreplaceable value of tangible, real-world experiences and the rich texture they add to our human narrative.

As we forge forward, let us do so with a spirit of collaboration and conscious innovation, seeking not just to build but to enrich, not just to innovate, but to elevate, carving a path that leads to a future that is not just technologically advanced but humanely enriched.

We’re starting to see metaverse real estate companies and developers coming out of the meta-woodwork, but everyone seems to have that lingering question in the back of their mind: Is this a good investment? And how much will it be worth ten years from now?

Before we get to those questions, let’s learn a little more about this buying opportunity.

Where is the Property?

Since there’s no single, unifying metaverse yet, there are multiple parallel virtual worlds, each with their own NFT parcels of land under development and ready for sale. The Sandbox and Decentraland are the primary two at this time. In these spaces and others, investment firms are buying up chunks of property and parceling it out for residential or commercial development. Transactions, of course, are made using the preferred cryptocurrency of that platform.

The real estate markets in these worlds function pretty much the same as in the physical world. Space can be owner-occupied or leased. Owners can improve their parcel with structures and features. We have zoning (and presumably neighborhood associations), along with retailer covenants and restrictions.

Metaverse real estate is currently a rich person’s game, but increasingly developers will democratize the movement and cater to average folks by offering micro-parcels because they need shoppers and concertgoers to hang out in this world.

The Economics

Here’s where things get sticky though. As one metaverse expert points out, the issue of scarcity doesn’t exist when it comes to land on the metaverse. Virtual worlds can be unlimited in size, Louis B. Rosenberg explains, since the world can be expanded and have multiple layers – that means potentially multiple buildings on the same plot of land with different owners.

As any Econ 101 student knows, price is set by supply and demand, so how can a metaverse property price be established when supply is unlimited?

How is Meta Land Valued?

In spite of those shaky economics, metaverse parcel purchases totaled roughly $500 million in 2021, and some say that amount will double in 2022. I think it will triple at least, given that new platforms keep popping up and celebrities are helping fuel the craze.

Supply and demand aside, it’s commonly accepted that real estate value – including the land and structural improvements – is a function of location, size, and utility/usability.

The first two seem applicable in the metaverse, although old habits are hard to break when it comes to location. Living next to a celebrity or a high-rent shopping district will strictly be for bragging rights since getting to the shopping center from any location in the metaverse takes the same amount of time.

And while it’s tempting to say that utility won’t be an important pricing factor since we won’t actually be visiting it in person, our avatars will be plodding around in virtual homes and hosting virtual dinner parties. And our avatars will want to shop at only the trendiest virtual shopping areas and attend shows at breathtaking virtual venues.

Thus, property values in the metaverse will reflect all three of those pricing elements, plus one additional one. Just like in the physical world, and maybe even more so in the metaverse, re-salability will be critical. Property turnover will likely be faster and more frequent in the metaverse since deeds are recorded in the blockchain as NFTs and quite easy to transfer.

So, while we will see metaverse real estate agents, we probably won’t see title companies.

The BIG RISK

Market fluctuations in the metaverse are to be expected, just as with cryptocurrencies and nearly any other asset. But the biggest risk with metaverse real estate is that the specific platform you’ve invested in fails completely.

After all, I see us eventually zeroing on one capital-M Metaverse. Right now, though, there are many, and even if we settle on two or three, that still means more will go by the wayside than will survive. These platforms will go blank along with all the property and assets.

Even in the worst real estate cycles in the physical world, it’s hard to imagine a parcel of property that loses all of its value forever. The equivalent situation would be if a beachfront property sunk into the permanent ocean bed or if the Earth were destroyed along with all possible investors.

Who’s Going to Buy?

I can see four types of people who will buy a parcel of property in the metaverse, whether for residential or commercial development.

Advocates

These are the true believers in the metaverse who are ready to build their personal space or their company because it’s where they want to be, and it’s where they believe most everyone else will be too. They live through their avatars and want them to be comfortable and successful.

Marketers

These brand owners want to market and sell their NFTs and other virtual goods or services. They also see the opportunity to strategically place their ads on the sides of buildings and popup billboards.

Hobbyists

Just like gaming is an addictive element of the metaverse, so too will be real estate investing. Buying, swapping, improving, bragging, one-upping … to these metaverse real estate enthusiasts, it’s a game of its own kind.

Speculators

I divide this group into three subgroups. The first is the cynical devotees of the “greater fool theory,” which holds that an investor is willing to pay “X” for an item as long as they’re convinced they’ll be able to sell it for “X+1” to the next person. Second, speculators also include less nefarious long-term investors looking for an alternative bull market option. Finally, other speculators are “fix and flippers” who are skilled at purchasing properties, furbishing them inside and out, and then reselling them to advocates, marketers, and hobbyists who aren’t quite as adept in this space and want a move-in ready property.

Final Word

I’m a futurist, not an investment coach. So please don’t take investment advice from me. Period.

Having said that, and again speaking as a futurist, we’re nearing a tipping point. I think there’s a very good chance the metaverse will be around for a long time and that over time, it will mimic nearly all the good and bad elements of our physical world.

That’s true for real estate in the metaverse too. There will be fluctuations and even bubbles. Ten years from now, any investor’s property might be worth 0 or else 100X what they bought it for. You might be the former, you might be the latter.

New metaverse platforms will emerge and many more will die away, along with all of their meta mansions, shopping centers, and convention centers. But the metaverse real estate market overall will consolidate and survive over time and property owners can too if they can avoid all those nasty pitfalls along the way.

While it’s already possible to run a virtual reality (VR) cooking school in the metaverse, one that demonstrates a three-dimensional Julia Child approach to preparing food, there are several emerging technologies that will add entirely new sensory experiences. These cutting-edge advances will not only redefine our online experience but will also pave the way for everything from virtual wine tasting, to online Costco food samples, to virtual chili cookoffs.

People in the future metaverse will indeed be able to taste, smell, touch, chew, and experience food and beverages. And the best part will be zero calories from the virtual food.

But will our avatars be okay drinking alcohol or using cannabis without their desired side effects? Most probably won’t, as evidenced by the current market share for non-alcoholic beverages. However, we’ll likely develop VR technology that will simulate those sensations as well – like relaxation and reduced inhibitions to name just two.

After all, the purpose and value of the metaverse is to recreate and duplicate as many aspects of physical life as possible. To do that, we’ll need to be able to experience the metaverse with every one of our five primary senses in the same way we engage with everything we come across in the physical world.

In fact, the metaverse cooking school may be one of the more ambitious tests of this parallel world, given that fine cuisine relies on two of the most discerning and individualized senses: taste and smell. These two exceptionally sensitive senses often work together. While I’m told it’s a myth that you can’t taste food while you plug your nose, just consider the health condition called anosmia, the simultaneous loss of taste and smell that’s one of the better-known symptoms of COVID.

How Do We Experience the Metaverse?

As we plan for the cooking school, though, it’s important to understand both the difference and the linkage between VR and the metaverse. Both are progressing side by side and it’s no wonder we equate the experiences.

Does gaming on your VR Oculus headset place you in the metaverse? It’s a matter of semantics. Some would call this “a metaverse,” others call it a pretty neat alternate sensory experience. Both can be right.

In my studies and analyses, I tend to focus on “the Web 3 metaverse,” the single, under-development, unifying, parallel-life, alternate universe that extends beyond any single gaming environment to replicate and create new and better human institutions, businesses, and experiences. It’s substantially more than a game.

But whether you’re gaming, setting up a cooking school, or buying virtual real estate (and be sure to see my blog next week on the latter), for the time being, these will require specialized VR sensory equipment to engage in the experience.

Progress in VR Sensory Experiences

In the earliest manifestations of VR, the tools accounted for two of the five major senses – sight and sound. The experience in both is getting better all the time with each breakthrough.

Next came haptic suits and gloves to virtually mimic touch, skin, and body sensations. In other words, you’ll feel getting punched or having a zombie tap you on the shoulder. That’s three of the five basic human senses down … and two to go.

Smell and Taste – The Last Major VR Sensory Frontier

Understandably, recreating the senses of taste and smell in VR and ultimately the metaverse has been trickier. But we’re seeing breakthroughs in that regard as well and we’ll be in the metaverse cooking school before you know it!

Of the two, recreating the sense of smell might be easier. New technology has been introduced that will not only offer that olfactory sensation but also integrate it with VR sight and haptic touch experiences as well. You’ll see a virtual orange on the tree, pluck it off, and smell it. So far so good, but not good enough.

Taste is probably the trickiest sense to capture virtually. We’re seeing some breakthroughs here, too, though. In one manifestation, there’s the emergence of gadgets that trick the taste receptors on your tongue to convince you that a real chunk of algae tastes like a virtual medium-rare piece of filet or a bite of pound cake. Here’s a report on what this dining experience is like.

Other promising VR tasting technologies are exploring ways to electronically simulate jaw muscle activity to reproduce the sense of chewing. Clearly, there’s a way to go yet in the taste department, including the ability to remember the taste of an orange so you can anticipate the experience and trigger saliva glands. Equally important will be the ability to imagine and virtually predict sensory taste outcomes – how the egg would taste with a dash of salt, for example.

Once we’re able to use our virtual sense of taste in this way, we’ll be ready to have a true experience in cooking school that goes beyond mixing ingredients according to a formula.

Final Thoughts on VR and the Metaverse

With those five virtual senses in hand, so to speak, we’ll count on creative geniuses to artificially create some additional virtual reality sensory experiences, for example, hunger, balance, pain sensation, temperature sensitivity, and more.

And finally, to completely experience the metaverse with all of our senses, will we need to suit up with helmets, haptic suits, taste-bud stimulators, and the like? Yes, until someone finds a way to hardwire our brains with all of this capability so we can simply switch it on and off and make the trip unencumbered.

A few years ago, I wrote a column titled, “How Much are the VR Broadcasting Rights Worth for NFL Football?” I described how in the near future we would safely attach several cameras around players’ football helmets, and through virtual reality (VR), viewers could immerse themselves into the action those players experience in conjunction with visual perspectives from around the stadium. With some haptic feedback suits, they would also be able to “feel” the action on the field.

In fact, NFL teams are now using helmet cams in practices and warmups but not during a regular season game. The NFL also occasionally arranges for the camera hat vantage point of officiating team members – especially the back and field judges who face the action from the defensive side of the ball and the umpire who watches the play from the quarterback’s perspective.

However, it’s just a matter of time until we have player helmet-cams being used in regular and post-season NFL game broadcasts. Over the last few decades, the NFL game viewing experience has steadily improved with instant replay, color programming, mics spread across the stadium, multiple camera views, and real-time stats. Soon you will be able to add many other user-enhancing VR features to this list.

The Limits of VR

Much of the fun of watching football games, or other sporting events, concerts, etc. – whether on television or in person – is the social aspect of the experience.

Traditional VR technology tends to isolate the viewer from people in the rest of the viewing location.

Sure, viewers and their friends can all wear the same devices and possibly watch the action from the same perspectives. They can talk to each other out of the sides of their mouth as they view the Hail Mary pass or game-saving tackle (“Oh man, did you SEE that!), but everyone remains locked into their own view and their own micro experiences.

Yes, these VR NFL fans are still in the real world, and yes, they’re looking at vastly new perspectives of the real world.

Another World Altogether

In contrast, how about groups of friends meeting at the stadium – in the metaverse – where they’re able to not only watch the game but engage with each other, exchange high-fives and razz the fans of the opposing team sitting behind them?

This kind of emerging experience takes VR to a new level. There’s a big difference between interacting in a single-viewer experience (traditional VR) and viewing it virtually as a group in the metaverse – with all the benefits of the point-of-view technology that allows for a much more immersive viewing experience of the event itself.

Basketball First

Meta, formerly known as Facebook, is already working with the NBA to broadcast NBA games for fans in the metaverse. Based on reported experiences of some users, the technology is in its infancy, but it demonstrates the promise of creating the kind of real-time, personalized, interpersonal experience of being at a game in the best possible seats and among the best possible company.

Future Implications

As this technology advances and finds its way into the NFL experience, we may see a decline in in-person attendance at average in-season games. Team owners who plan ahead, though, won’t be financially affected as they find unusual new ways to monetize the meta-viewing experience.

Competitive teams will still sell lots of actual, in-person $300+ tickets to die-hard fans, along with beers, nachos, and jerseys. But tens of thousands more fans will pay $50 for a meta-virtual second deck seat and proportionately more for seats closer to the field. At halftime, they might buy an official NFL-licensed NFT team jersey. These viewers may see ads during some of the breaks in the action, except for those viewers who bought premium skybox tickets or hold season tickets.

New Angles

And when it comes to camera angles, there will be very few limits. Every player, coach, and official will have a helmet/hat cam with an audio microphone, capturing pretty much everything except play-calling in the huddle. Technology will be available to immediately scrub the audio to preserve G-ratings upon request.

We’ll need to get used to player helmet camera views. A few years back when the World Football League was experimenting with helmet cams, after a particularly hard hit, a quarterback’s helmet was knocked off his head, falling to the ground, creating the visual impression for many that the player had been decapitated!

Beyond helmets, though, cameras will also be at both points of the football. Quarterbacks who don’t throw spirals could make this a pretty troubling viewpoint, although gyroscope technology will limit that effect somewhat.

Drones have been used by NFL teams in many ways – except for recording game action. Among the future metaverse football viewing options will be quiet drone cams programmed to follow plays from either the offensive or defensive perspective, key players, or even sideline activity.

“In-Person” vs Viewing Events

Metaverse inhabitants/avatars will have the option of experiencing an NFL game at the metaverse stadium or remotely at their meta-home or in another meta-viewing venue. Fans at the virtual stadium will likely key in on just a few game views to keep their experience more manageable and realistic.

Metaverse viewing parties will be a different story, though, as the presentation mixes these views in accordance with the wishes of the attendees. They’ll be able to watch a play live from the quarterback’s perspective and then the replay from the football cam as the ball soars to the receiver downfield and then from the back judge’s view as they call pass interference. Hosts will hire producers to adeptly switch back and forth among these views as details of the plays evolve both during and after the play.

We’ll see retired players hosting viewing parties in the metaverse, offering running commentary and answering questions. Yes, quite a bit like ESPN’s breakthrough Monday Night Football ManningCast!

Groups will rent out venues in the metaverse to watch the big game as a for-profit venture, to entertain clients, or raise funds for charity.

Adapting the Game to the Metaverse

To prevent all of the unique views and vantage points in a game from being wasted on metaverse fans, and much to the chagrin of NFL purists, the NFL will likely increase the time between plays from 40 to 60 seconds to allow for multiple vantage point replays. Official overseers “in New York” will also take advantage of these perspectives.

Other rule changes and practices will invariably be adopted to optimize the experience for metaverse viewers.

The Expanding Sports Metaverse

This combination of metaverse in-person/avatar viewing and the more expansive metaverse viewing party experiences can and will be replicated in most other sports. Faster-paced, less predictable sports will probably make the best use of it.

But even aficionados of the more gentile, predictable sports like horse racing and golf will want to be there in-person or in-avatar to see first-hand the event’s nuances, like saddling up and club selection as the action unfolds.

Four years ago, I analyzed the benefits, downsides, and challenges related to creating a citizenship rating system that would document a person’s value to society. And we further discussed the topic in a recent podcast interview with Shermon Cruz, Chair of the Association of Professional Futurists.

The idea was that since most human beings tend to be motivated by personalized, objective rankings (FICO scores for example), a universal system that “rewards” us for doing the right thing and “penalizes” us for doing harmful things could make the world a more positive place.

One of the challenges we identified at that time was that there wasn’t a reliable way to capture and account for every personal activity in order to assign it a positive or negative point value. Another limitation was that most governing bodies focused on penalizing people for bad or criminal behavior, but they didn’t have a way to incentivize people for good behavior.

The DAO Solution

Today’s DAOs (Decentralized Autonomous Organizations) provide a model for how we can overcome both of these challenges and accurately quantify a person’s positive citizenship value, so they can be rewarded … or negative citizenship value so they have an incentive to improve.

Much like Santa Claus, DAOs will be able to record if a person has been naughty or nice within that group. And the groups themselves will take the place of traditional governing bodies in many respects, since they replace geography-based communities with metaverse-oriented tribes.

DAO Communities and Governance

Today’s blockchain-enabled DAOs are formed around aspects of social life, community service, hobbies, gaming, investing, entertainment, art, and other areas of shared interests, including ownership of land in the metaverse. Increasingly, we’ll be relating to peers within our chosen DAOs and less with neighbors in the physical world.

Here’s where things get relevant to our topic. Typically, engaging in a DAO requires an upfront entry fee to buy governance tokens that give the user a vote regarding actions taken by the DAO. DAO members often can earn additional governance tokens for actions they take that provide value to their DAO community – participating in meetings, joining and engaging in workgroups, contributing content, and so on. These governance token rewards are tangible incentives for taking positive actions.

Presumably, a DAO could also be structured and maintained to levy fines for users who damage or undermine the venture.

Since a participant’s activities in these DAOs are recorded on the blockchain, there’s really no reason why user activities can’t be recorded in terms of reward or penalty points. For better or worse, our activity in these niches of the metaverse cannot be hidden or slide under the radar.

One Big DAO Metaverse

As the metaverse continues to replicate more and more areas of our physical world, we’ll see DAOs and pieces of the metaverse merge and link to encompass an even greater slice of this alternate life. Games are already seamlessly linking to cryptocurrency finances, for example.

Ultimately, there will be one system and one login to a comprehensive metaverse. And at that point, it will be very easy to assign participants a comprehensive citizenship score or valuation that reflects their contribution or harm within that new world.

DAO Citizenship

This kind of global metaverse will attract a wide range of people – from those who are mildly interested to those deeply involved in every nuance of a virtual world’s DAO.

Early on, some may poke around in it for 20 minutes a day. Others may be involved 10 hours a day. And many will lose themselves in that comprehensive DAO completely, right from the start. If a person wants to remain relevant, though it will be increasingly important that they engage in the metaverse – just as being off the IT grid today can make a person seemingly non-existent.

Our engagement in this metaverse will be monitored, and our true selves will become apparent. As with the physical world, we’ll see all types of personalities: hard workers, observers, innovators, leaders, followers, specialists, givers, takers, criminals, saboteurs, and anarchists.

Our personality types will be recorded and transparent, modified automatically over time as new activities are recorded. On a more immediate basis, our deeds will be rewarded or punished using a point system linked to cryptocurrency. The best metaverse citizens may even be able to make a decent living by being very, very good as resources are shifted to them and away from the penalized participants.

Criteria for Gamifying Citizenship

The standards for an ideal measurement of a person’s contributions to society require that the system it’s based on reflects current realities is objective and is all-knowing. A metaverse-based system meets those criteria.

As I noted in my 2018 column, citizenship algorithms should be adjusted over time, continually redefining what constitutes good and bad behavior based on current needs and situations. Similarly, the relative value of rewards and penalties should be regularly tweaked based on measured supply and demand. The metaverse, with its nearly infinite access to information, can accomplish all this and more.

With regard to the need for objective observation and the transparency of personal actions, blockchain technology will be the “Big Brain” behind the metaverse making all that possible. It will record participants’ activities and interactions and meter out the rankings and the rewards related to that activity.

Citizens of What?

One last thought on the future of citizenship. Blockchain, cryptocurrencies, and the Internet itself transcend government-set boundaries. Increasingly each of us will be “living” in one or more DAOs and then ultimately within a comprehensive metaverse.

Our actions in the metaverse will ultimately be as important in evaluating us as a person as anything we do in the physical world today. And the evaluations will be ruthless and not subject to manipulation or coercion, providing a strong incentive to do the right thing among our global peers.

That said, for those who cannot live up to the rigorous demands of an unforgiving rules-based system, we will likely see underground movements and even gorilla groups forming to fight back against the “tyranny of the DAO.”

No, there is no such thing as a perfect system.

The metaverse is the collective assortment of byte-based alternatives to features of the physical, atomized world. The metaverse is in our future with or without our permission. We’ve taken too many steps in that direction already to stop it.

And as we noted just a few weeks ago, while many people think of the metaverse as some version of the dystopian movie, Ready Player One, the bulk of the metaverse will have far more utilitarian value.

To understand where all of this is headed, it’s instructive to look back and put in context the significant steps we’ve already taken down the virtual metaverse road.

History and future are one continuum with no beginning or endpoints. At any given time, we can see how today’s breakthroughs and future trends are building on top of the framework of previous discoveries. Whether we knew it at the time, the historical steps I’ll lay out below were critical in the formation and future of the metaverse. It’s very clear in hindsight.

So, let’s look back 40 years or so to get a fresh perspective on this metaverse trajectory. I selected 1991 as a beginning point, the advent of the internet. But we could just as easily establish a similar timeline that leads up to that important breakthrough, too.

Why are these milestones considered elemental to the emergence of the metaverse? Each one adds an element of structure, capability, and, yes, reality within that virtual, parallel world – a metaverse many would consider safer and more democratic than our physical universe.

Brief History of the Metaverse

1991 – Birth of the Internet

On the 6th of August 1991, Tim Berners-Lee posted the very first public invitation for collaboration on the WorldWideWeb. This is the date the Internet was born.

1992 – Snow Crash

The very next year, science fiction writer Neal Stephenson coined the term “metaverse” in his 1992 novel Snow Crash, where humans, as avatars, interact with each other and software agents, in a three-dimensional virtual space that uses the metaphor of the real world.

1993 – Proof of Work

The term and concept were introduced in the context of computer security as a way to prevent email spamming. Later, proof work became one of the primary techniques for verifying and legitimizing transactions on a blockchain, specifically – cyber currency mining based on computer power.

1998 – B-Money

Computer engineer Wei Dei revealed his concept for b-money, a decentralized, distributed cryptocurrency. It never came to pass but some of the concepts are very similar to those in Bitcoin, which emerged years later. One element was the use of Proof of Stake, an alternative mining algorithm that relies on the developer’s current holdings of the cryptocurrency rather than raw computing power.

2002 – Digital Twins

The concept and model of the digital twin – the digital counterpart of a physical object – was publicly introduced in 2002 by Michael Grieves, then of the University of Michigan, at a Society of Manufacturing Engineers conference. Grieves proposed the digital twin as the conceptual model underlying product lifecycle management.

2003 – Second Life

Second Life is the online virtual world, developed by Philip Rosedale and his team at Linden Lab in 2003. It was very much a precursor to the Metaverse worlds being developed today. One of the biggest problems Second Life users faced was low bandwidths and high “res” times making it a less-than-optimal experience. But even today, Second Life has an active user base of a million people, each spending over four hours a day in this virtual world.

2006 – Roblox

This online platform was introduced that allowed users to create and play games developed by other users. During the 2020 pandemic, it became a significant source of interaction for young people, and it became the third-highest-grossing game that year.

2009 – Bitcoin

On the 3rd of January in 2009, the bitcoin network came into existence with its mysterious founder, Satoshi Nakamoto, mining the genesis block of bitcoin (block number 0), which yielded a reward of 50 bitcoins. This was the day Bitcoin was born.

2009 – Blockchain

Along with the invention of Bitcoin, Satoshi Nakamoto also invented blockchain to serve as the public transaction ledger for Bitcoin. Even though others have claimed to have invented the concept of blockchain earlier, the same day that Bitcoin was launched is the same day that a usable form of Blockchain was born.

2010 – Play-to-Earn Technology

Gacha games had grown popular in Japan by the early 2010s, based on the capsule toy vending machine concept, with the earliest known system being in MapleStory. Players would earn currency that they could use to participate in a random draw from a set of items based on pre-determined rarities, often with the goal to collect all of a one set of items to gain a powerful in-game reward.

2011 – Ready Player One

This novel by Ernest Cline introduced many young people to the concept of a virtual reality world. The Steven Spielberg adaptation in 2018 made the idea even more vivid and the interest more widespread.

2012 – NFTs

An NFT or “Nifty” is a Non-Fungible Token, representing a unique item instead of fungible tokens, which are mutually interchangeable, such as cryptocurrencies like Bitcoin. The concept of NFTs has been with us since December 2012 with the creation of “Colored Coins,” in which additional information is incorporated onto a bitcoin so that it is no longer fungible but unique. This, interestingly enough, was a project spearheaded by a young Vitalik Buterin as he worked on improvements for the Bitcoin blockchain.

2014 – Vitalik Buterin

The Thiel Fellowship – In 1999, Peter Thiel’s company Confinity merged with Elon Musk’s company X.com to form PayPal. Three years later, eBay bought PayPal for $1.5 billion, making both Musk and Thiel very wealthy. In 2010, Peter Thiel announced the formation of the Thiel Fellowship, offering $100,000 grants for students under the age of 22 to leave school and pursue other work. In 2014, one of the recipients of this grant was 20-year-old Vitalik Buterin, the co-creator of Ethereum.

2015 – Ethereum

In July of 2015, Vitalik Buterin and Gavin Wood launched the Ethereum Network, along with the ethereum blockchain.

2015 – Decentraland

The first iteration of this virtual reality platform was introduced in 2015. It allocated “land” via a proof of work algorithm. The 2021 boom in NFTs has led to sales of some of the game’s real estate plots for more than $100,000.

2015 – Smart Contracts

Smart contracts were first proposed in the early 1990s by Nick Szabo, who coined the term to refer to “a set of promises, specified in digital form, including protocols within which the parties perform on these promises.” Since the 2015 launch of the Ethereum blockchain, the term “smart contract” has been more specifically applied toward the notion of general-purpose computation that takes place on a blockchain or distributed ledger.

2016 – Pokémon GO

Pokémon Go was the first game to overlay a virtual world onto the real world. It uses mobile devices with GPS to locate, capture, train, and battle virtual creatures, called Pokémon, which appear as if they are in the player’s real-world location.

2016 – The DAO – Decentralized Autonomous Organizations

The company named The DAO was launched through a crowdfunded token sale in May 2016, setting the record for the largest crowdfunding campaign in history at that time. It was meant to be an alternative venture capital fund, created on Ethereum’s blockchain, that would serve as a decentralized funding model. In June 2016, users exploited a vulnerability in The DAO code which enabled them to siphon off one-third of DAO’s funds into a subsidiary account. This led to the death of The DAO as a company. But the concept of decentralized autonomous organizations (DAOs) lives on, yet substantially improved by lessons learned from The DAO experience. Moving forward, each DAO will serve as an essential ingredient for future metaverse companies that are governed collectively by participants in the organization, with rules and financial transactions recorded on the blockchain. DAOs, for example, have been formed around joint ownership of NFTs.

2017 – Fortnite

This multiplayer video game was a huge success upon its release, and it introduced many people to the look and feel of the metaverse and cryptocurrency. Fortnite user base totals 350 million.

2018 – Dai Stablecoin

The Dai Stablecoin was introduced to add a new element to the volatile crypto universe. In contrast to cryptocurrencies that aren’t anchored to any fiat currency or are only anchored to other cryptocurrencies, the centralized Dai Stablecoin was pegged to the U.S. dollar, making it far less volatile and more reliable cryptocurrency for decentralized finance (DeFi). Today, blockchain-based banking services are available on a number of similar platforms for cryptocurrency borrowing, lending, and investing. For now, they’re largely unregulated by our traditional institutions, and users seem just fine with that, for the most part.

2018 – Decentralized Exchanges (DEX)

Cyber currency exchanges took a major PR hit when Bancor lost $13.5 million to hackers. Although their legal/regulatory foundation remains a little uncertain, DEXes continue to serve as a way for people to sell and trade their cyber currency assets person-to-person based on smart contracts, rather than through a centralized exchange.

2018 – Axie Infinity

The popular NFT virtual reality game, Axie Infinity, based on a mythical world of animal husbandry, was introduced this year. By mid-2021 it had the highest combined value of NFTs of all play-to-earn game platforms.

2020 – COVID

When COVID exploded on the scene in 2020, people around the world found themselves being quarantined with few options to dedicate their time and energy to. For this reason, the metaverse quickly became the go-to place for a growing number of young people, gamers, and those wanting to make money in the online world. In our polarized world, the metaverse has taken on a tone of rebelling against current institutions – the more ingrained they are more they’re at risk. This is pushing people to the underground economies and worlds of the metaverse, setting up a “perfect storm” for Metaverse growth.

2020 – Decentralized Apps (Dapps)

The value of the tokens on the six major blockchain platforms surpassed $2 billion. The movement to cut out the middleman continues, as open-source, transparent applications continue to emerge to enable gaming, DEXes, DeFi, and other acronymized uses. While many people refer to dapps as an emerging trend, the first dapp was actually the Bitcoin app more than a decade ago.

2020 – First Concert in the Metaverse

In April 2020, Travis Scott and Marshmello performed in the video game, Fortnite to just under 30 million people.

2020 – Solana

Also in April, the Solana blockchain dapp was introduced. In contrast to Ethereum, this dapp’s cryptocurrency, called a SOL, is mined based on the alternate proof of stake (POS) algorithm. Further, issues related to block ownership were clarified and simplified in Solana, with a new consensus tool known as “proof of history” that inserts timestamps into its blockchain.

2020 – Alien Worlds

This wildly popular dapp was created with a multi-metaverse interplanetary scenario that had NFT characters interacting in a decentralized autonomous organization to mine tokens and perform other tasks. By 2021 Alien Worlds had more than 2.5 million users, but its significance goes beyond that – the game has been built around critical lessons for teaching people about the principles of cryptocurrency and crypto-mining.

To the Future

The evolution of various kinds of enabling technology and new features in the metaverse over the last few years has been incredible. But not as amazing as it will be beyond 2021.

In fact, in the future, there will be few if any aspects of society – including government, business, churches, entertainment, dating, politics, and even war – that will remain unchanged with the evolving Metaverse. It will have an especially profound effect on the way we educate ourselves and our children in the years ahead.

If you’ve been zoning out or raising your eyebrows when you hear references to the “metaverse,” it’s time to pay attention. It’s here. Well, at least pieces of it. As we speak, worlds are being created in cyberspace. They’re also being created or augmented literally before our eyes in the “real” world.

What’s the Metaverse?

How do we perceive the world? Through our senses, including our eyes. But that’s this world, this planet Earth, complete with people and objects made of atoms. We see the Earth-based world with our eyes. Now take a massive leap. What if there was another place, other than our atom-based world, say a byte-based world we could experience using augmented senses?

That’s a step into the metaverse. And there are many locations to choose from once you’re there.

At its most radical, one spot in the metaverse may look like a completely new cyberworld. Think The Matrix or the novel Ready Player One. The latest iteration of those may be the games Alien Worlds, Axie Infinity, or The Sandbox in which players navigate multi-planet worlds and experience all the drama and conflict across those planets that you can imagine.

A less extreme manifestation of the metaverse would be a scenario where the augmented reality is superimposed onto the real, atom-based world. Participants would share this augmented environment, meaning everyone with the correct virtual reality tools would see and experience the same augmented reality while they navigated the real world together. Pokemon GO is leading people’s thinking in this direction.

Challenges

Experts point out that technology has a long way to go before we can truly achieve a metaverse state of things with no limits or barriers. For example, there are the challenging issues of the internet infrastructure, the feasibility of having large numbers of participants interacting with each other in real-time, language barriers, and latency issues.

Some experts feel that constraints like these and others will limit the metaverse to the gaming world, where it already has a foothold and an avid clientele. Others question whether the average person will sign on, given that they’re already mistrustful of high-tech business models that simply mine and sell user data.

More Than a Game

Time will tell if the metaverse creators will overcome these hurdles. Will the experiences become a normal part of our lives, rather than just a game-driven diversion? I don’t think we’ll see one, single parallel universe/metaverse that everybody is a part of, in spite of the science fiction scenarios that are so intriguing.

Rather, we’ll be applying metaverse principles and technology on a more achievable scale that will improve our lives in a number of areas. After all, the metaverse at its highest and most noble level is a space where people can interact in real-time in a created or enhanced environment.

Yes, I think there’s a market for that!

Is it a COVID Thing?

There’s no doubt that people’s interest in metaverse technology was accelerated by the pandemic. We didn’t hear of too many hardcore gamers complaining about isolation or a lack of human interaction. No, it was those of us who relied on real-world encounters for stimulation and sustenance who felt the isolation the worst.

Unfortunately, pandemics (COVID variants and others) will be on our mind and in the news for the foreseeable future. This is bound to drive even more interest in offering technology that enables us to live interactive lives in “safer” environments.

Coming Soon to the Metaverse Around You!

If there’s one thing we should have learned in the last 50 years, it’s to never underestimate and casually dismiss fads – especially technology-based fads. This is another one of those times.

One obvious metaverse application will be in entertainment. Instead of listening to a concert in person or even online, we’ll enjoy a shared experience as our avatars are elbow-to-elbow with our friends and all the other attendees that bought their ticket and showed up in this metaverse concert venue.

What about office work? Thanks to the metaverse, office work-from-home will be a thing of the past. No, we won’t necessarily be back in the physical office; we’ll be working and meeting in a metaverse-enabled shared space, elbow-to-elbow this time with our co-workers or potential clients.

What about Grandpa?

As with any breakthrough technologies and sea change concepts (e.g., internet and cryptocurrency), as metaverse applications like these become mainstream, some people may be left behind. That may be thanks to their own stubbornness, but in most other cases it will be due to an inability to learn to navigate or to even fathom such a drastic leap from the norm.

The challenge for metaverse developers and the industries that will offer services using the technology is to get past this hesitancy by making the applications as user-friendly as possible. Remember teaching your parents, grandparents, or great-grandparents how to: get on the internet, download an app, or send an email? And more recently how to navigate a Zoom call? With a little instruction and logical interfaces, most everyone will quickly master them.

If designers do their job well, before we know it, the vast majority of us will be in the metaverse – not necessarily gaming 20 hours a day, but occasionally and regularly interacting in virtual spaces “face-to-face” in real time.

In fact, experiencing certain aspects of our lives within the metaverse will be far easier than gaming in the metaverse. It will be natural communication, friendly discussions, business meetings, topical interactions, and so much more.

Can you imagine a future without social media? It’s probably just as hard for us to do that as it would have been for people 25 years ago to imagine a technology that would allow us to easily share information with the world.

Modern social media began in 2003 with the business-centric site LinkedIn, followed the next year by “thefacebook.com.” We’ve come a long way since then. As of 2019, there were 3.5 billion active social media users, representing 45% of the world’s population, who are online for an average of three hours a day.

What’s behind the screen?

These days, though, we’re seeing a perilous side of social media. More than ever, it’s being used to influence, rather than inform or entertain. We’re all too willing, though, to share information about ourselves – and not just by posting, but by offering up the behavioral information that can be gleaned from our engagement with various platforms. Screen time. Hover time. Friends. Likes. Clicks. Shares. Purchases. This data is a gold mine to advertisers so they can more cleverly personalize their online pitches right back at us – on social media. You can learn more about all of this in the fascinating film, The
Social Dilemma.

But enough with history and current events. What about the future of social media sites and platforms? Given that social media has become so institutionalized in our lives, it’s not going away. It’s also become a critical element of advertising. That’s why today’s Mad Men won’t let social media go away either, nor will the organizations that want to sell, sell, sell.

Predictions for the future of social media

First, new sites with new features will keep emerging. When one becomes mainstream, others will come along to fill an edgy niche. When one begins to aggressively supervise the posted content, others will emerge in the fringes.

Since many of these companies have decided to become the arbiter of acceptable content on their platform, they’ve opened themselves up to thousands of potential lawsuits by those who have been offended, in every language, every religion, every nationality, every cause, in the world. This is what I refer to as the “death by a thousand paper cuts” scenario.

Keep in mind, the speed with which a company can scale up, is also the speed with which it can be dismantled…. maybe even faster.

Second, more and more sites will form around people with shared interests, values, and lifestyles. And yes, politics. They’ll increasingly serve as homes and clubs, rather than the broad-topic, world-wide forums we’ve gotten used to. Thus, social media will divide, isolate, and compartmentalize us as a society even more. Social media becomes just the opposite, anti-social media.

Related to that, is the prediction that there will be increasing pressure for people to dominate a social media site, just like they would a club. In a way, sites will increasingly serve as a jumping off point for personal fame and fortune. They’ll be formed for that exact purpose. An online resume won’t be enough to land your next job. You’ll need an entire media channel to explain who you are.

That leads to the following major trend that perfectly captures the future linkage between social media and advertising, taking it out into the open for all to see.

The social media advertising connection takes over

The biggest developments in social media will be driven by changes in advertising in combination with artificial intelligence-powered virtual reality (VR). The two were made for each other, as described in this fascinating article from an advertising industry insider.

In a nutshell, he describes how ten years from now we’ll be experiencing social media through virtual reality, such as augmented reality glasses. The lines between real life and social media will blur. And within that experience, we’ll be more inundated than ever with advertising-related intrusions.

We’ve all opened a website and within seconds seen a photo avatar customer service representative with a dialog box. She says something along the lines of, “Welcome, are you looking to purchase one of our products today? Let me know if you have any questions.” Put that experience on steroids in the not-to-distant future.

The new friend scenario

You’re walking through the city.

The President of Future Motor Company pops into your field of VR eyeglass vision and says, “Hi Winston, we noticed that you’re coming up on our Auto City car lot on 12th Street. Now I know you bought your last car from Funday Motor America three years ago. But you’ve paid it off, and we see that you’ve been looking at EV options online. Our lot on 12th just got a shipment of seven plug-in hybrids this morning, including two SUV models similar to yours. Why don’t you come in for a quick test drive? Melissa’s at the first desk and she has all your information.”

Other types of social media-driven, pseudo-visual interactions will be less intrusive and more pleasant. But they’ll be equally life changing. Within your social media platform, you’ll have the opportunity to create or find an intriguing social media avatar – a hologram – to be a social media VR friend. Someone with whom you can slip on the VR glasses and share a hug, a cup of tea, or a glass of wine.

Will big brother advertisers continue to eavesdrop on these types of conversations? Or will the entire industry be replaced by something we haven’t seen yet? I give it 8-10 years.

1994 was the first year that television broadcast rights for NFL football exceeded $1 billion. While currently earning between $5-$6 billion per year, the NFL currently has its eyes set on a much larger number in the years ahead, upwards of $25 billion.

Broadcast rights include an exclusive piece of content through which a broadcast company, in this case, CBS, Fox, NBC, and ESPN, have the right to air all the events leading up to the game, the game itself, and any post-game events significant enough to attract an audience.

The television rights to broadcast NFL games are the most lucrative and expensive rights of any American sport.

The value of these rights is based on a broadcaster’s ability to sell ads and make a profit. In most cases, the profit potential has to be several multiples of what they cost. So if the rights to an event cost $10 million and the cost of producing the broadcast with producers, hosts, commentators, reporters, camera crews, engineers, and studio analysts amounts to another $10 million, the television station may need to see potential ad sales of over $100 million to make it all worthwhile.

Over time television companies have become very sophisticated in their ability to predict audience size and generate ad sales.

As a result, professional sports have grown into a massive industry with player contracts, licensing agreements, and stadium deals all in the crosshairs, as owner groups have been quick to mine every possible revenue stream to their advantage.

That’s why the latest innovations in virtual reality are particularly interesting because they open the doors to entirely new revenue streams that currently don’t exist.

The key difference is that broadcasting rights for VR will have far less to do with ad sales and far more to do with the overall value of the experience.

The Ultimate Form of Story Telling

Athletic competition is only interesting if athletes and teams are relatively evenly paired, and if either team has the potential to win or lose their next competition.

Teams that always win tend to be far less interesting over time, and those with constant losing streaks are the least interesting of all.

In this context, sporting competitions have become the ultimate form of storytelling. Each contest is a test of the human spirit, with good guys and bad guys pairing off, amidst the great drama, as people test their limits to overcome adversity, in their struggle to achieve victory. And all of this is unfolding in real-time, veiled in the mystery of an unknown outcome.

For this reason, sports have become critical of fresh content in a world where relevance is gauged by timeliness and hyper-awareness is all part of the group experience.

The value of these broadcasts degrades exponentially faster than virtually any other form of content because once it’s over, and the scores announced, few people have an interest in watching it all over again.

As a result, sporting events take center stage as viewers plan their days. Most media companies view sports as an anchor event around which all other programming is scheduled.

When will the experience be good enough?

As with any new technology, users have had to put up with bad prototypes and beta-quality equipment for several years, knowing something better will be coming soon. The public is now poised for the next generation of VR gear, sensing that every iteration moving forward will be substantially better than anything in the past.

But with football broadcasts being one of the thousands of potential applications, even the upgraded gear may not be ready for prime time.

As I see it, the ultimate football broadcast will involve a few key players on each team wearing tiny helmet-cams so viewers can experience the game the same way a player does.

This assumes video cameras that are tiny enough and durable enough to survive the rigors of full contact, and batteries and transmission modules unobtrusive to those wearing them.

It also assumes viewers and advertisers will be paying a premium for this kind of experience.

Once that’s proven, an even later generation VR will add haptic-sensation devices that allow wearers to feel the impact of getting hit on the field and, to some degree, the struggles each player feels as he plays the game.

The sale of VR gear will have to reach hundreds of millions of users before there are sufficient markets for teams and broadcasters to make the investment. Once that happens, the league will have to zero in on the right price point viewers are willing to pay a premium for that kind of viewing experience.

That could range from $50-$100 per game, or more, depending on the market. Since advertising on VR is still in its infancy, it’s unknown how much of it can be offset with sponsors.

Regardless of how good the broadcast is, virtually no one will want to spend 3-4 hours straight watching a game on VR. It will be an intermittent experience, with long interludes to enjoy a beer and some food and to talk with friends. Most likely it will be one VR set per party to share the experience.

Under optimal conditions with marked improvement in each new generation of gear, and sales of VR gear going through the roof, we are still at best five years away from any serious revenues being made from VR broadcasts of the NFL.

Final Thoughts

The first live sporting event to be broadcast on VR will be NASCAR. Fox Sports has teamed up with NextVR to bring the 58th running of the Daytona 500 to Samsung Gear VR users.

Done as a promotional event, NextVR will have 360-degree cameras positioned at the starting line, in the pit row, and in the garage. And Fox will live stream a directed broadcast of the race complete with graphics and commentary to guide virtual reality users around the track.

With Samsung underwriting the costs of this experiment, this will be a good test case to determine the overall value of the experience. Yet it is far from having cameras mounted on every driver’s helmet and having an immersive “feeling-the-heat-of-battle” experience.

We will see a number of these experiments play out over the coming years with tech companies hoping to drive sales and sports teams looking to set the stage for a more engaged audience and measurable broadcast rights somewhere down the road.

VR has the potential to make or break sports in the future. Both engagement and entertainment levels will change, as will the audience experience. It will also dispel some of the mystery behind the magic. That will be unfortunate for some but a boom for others.

It will also mean that physical sports will have to compete with virtual sports on the consumer attention index. Since video games are far more VR-ready than anything in the physical world, the real competition here may be for the mindshare of consumers in an overly distracted marketplace.