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How much would you pay for decorations for a non-existing living room? What about a suit that you’ll never get to put on? If these questions sound nonsensical, that’s because they are — and yet, soon enough, some of us may face them head-on, according to Andrew Bosworth, Meta’s CTO.
In his interview for BBC Click, Bosworth enthusiastically informed the hosts that for him, the most exciting part of Meta’s metaverse is its “economy.” The virtual space will give rise to services like virtual interior design or avatar styling, he shared. For those of us who don’t mind an occasional evening in playing video games, this might have struck a familiar chord. For those who don’t — welcome to existence, free-to-play edition, proudly brought to you by Meta.
You probably won’t like it here. But let’s not get ahead of ourselves.
Into the nonspace of the mind
The metaverse, as we’re being told, is a shared virtual experience where regular Internet users get to explore both the real and virtual worlds as their avatars or digital representations. This should ring a familiar bell to any gamer, as that’s exactly what any MMO is about. You create your elven warrior, superhero, or Jedi knight, and delve into a virtual world built for your entertainment. Close enough.
So far, so good.
Now, from the business perspective, the gaming industry is increasingly relying on making you pay not for the game itself, but for how much your Jedi can style on the enemies while slashing them left and right. Instead of (or along with) selling the game, companies sell in-game cosmetics that change the way characters, weapons, and everything else looks without any functional changes to the gameplay. Fortnite, which depends on cosmetics sales as the main revenue source, raked in $9 billion in its first two years. League of Legends, another major free-to-play title, has consistently brought its publisher almost $2 billion a year between 2015 and 2020, spiking at $2.1 billion in 2017.
Note that for either of these games, the respective player base counts in millions. Facebook, for its part, had just under 3 billion users in 2021. If the company were to get them into that sweet digital cosmetics market, the revenues it would be raking in, either through direct sales or a cut from what third-party designers and modders are putting on offer.
For now, billions of log-ins into Meta’s metaverse look even less real than the metaverse itself, as that’s still something we are yet to see and experience. And yet, we’ve seen all the oh-so-exciting metaverse office meetings, we heard of Meta looking into bringing religious worship on its platform, and we’ll see it or its rivals reach out into more aspects of our lives soon enough. It’s not just all the juicy data they can seize, even though that is very much a legitimate concern voiced by a plethora of critics. Think of how many occasions for showing off your bling can move online — and someone’s gotta deliver that bling, right?
Would it dethrone ads as the core driver of Meta’s business? Not in the coming decade. But assuming the company succeeds in bringing more businesses and users on board with the idea of a 3D Internet, these cosmetics will surely find their buyers. This has some interesting — and potentially grim — implications, especially seeing how Meta’s ads make such perfect use of behavioral data.
A vicious circle
Companies adopting the free-to-play monetization techniques in their titles naturally have an incentive to max out the users’ shopping sprees. To this end, they can deploy a whole array of design decisions, from annoying pop-ups with links to in-game shops to more sophisticated tools. The latter use behavioral data and psychological tricks to goad the users into spending more.
Some of the latest patents coming from leading industry names, such as Activision, put machine learning at the service of the company’s bottom line. Tweaking the matchmaking system to prompt new players to spend more? Check. Clustering players in groups to target them with tailored messaging, offerings, and prices? Check. These and other techniques live and breathe behavioral data. As such, they do raise red flags in terms of data exploitation, especially if you consider who tends to fall for them the hardest.
Free-to-play games make a solid chunk of their revenues off a very small subset of their player base, the so-called “whales,” as high-paying players are known in the industry. It may be debatable just how crucial high-payers are for a given free-to-play-title in today’s market, and their proportion is exceedingly small. Their scarcity could only be showcasing the problem, though, as free-to-play tricks work best on the most vulnerable targets, from compulsive spenders to children. These are the mechanisms behind the stories of kids spending thousands on in-game purchases.
The underhanded monetization tricks in gaming have given rise to much controversy. Gamers are quite aware of their encroaching on their hobby and are no strangers to calling the industry out, be it loot boxes or other pesky cash-grab attempts. One would think such awareness and outcries could work as a built-in immune system for users and help the industry develop a set of healthier practices.
For its part, Meta set off dozens of red flags with its own data practices. But as a giant that it has become, it powers on, even if bleeding users and money. Its own prowess with behavioral data is well-known, too. So why would the company let a handy tool like that rest as it brings the digital cosmetics economy into the parts of our lives that have so far been offline? That would just be a waste. Life is the biggest free-to-play out there, after all, and it would be a shame to miss out on such a massive player base.
Meta’s metaverse is hypothetically off-limits for children, and yet they’re already exploring its digital confines. Thousands of unsuspecting normies, blissfully unaware of the sophisticated whale hunt weaved into the very fabric of the new reality, may be joining in soon, should Meta’s power-play begin to bring its fruits. Would this exodus into a thin-air economy be as dystopian as some of the other ways that the metaverse can turn into a digital hellscape? Probably not. But it’s just a little something to be aware of next time you’re shopping for a nice cozy sofa for a living room that’s not really there.
Denis Khoronenko is the content editor at ReBlonde.