Africa News Bulletin

Can Africa enter the metaverse?

As much of the world stayed indoors during the pandemic, there was still somewhere to get dressed up, buy land, and take trips to distant locations. But instead of walking into a shop, meeting an agent or getting on a plane, all this could be done from the comfort of a home. Through the portal of a virtual reality (VR) headset, users can enter the metaverse, a virtual universe made up of different worlds that could have a trillion dollar real world economic impact.

Analysts are predicting the metaverse could be the next incarnation of the internet, with extended reality (XR) technologies like VR and augmented reality (AR) – which merges the digital and physical world – providing an immersive consumer experience.

Tech giants focus on the metaverse
For its sceptics, the metaverse is a vague concept that muddles our understanding of existing technologies, or a bluff that’s as likely to become reality as the science-fiction novel Snow Crash, which coined the term. A future defined by participation in the digital realm seems even more out of reach in sub-Saharan Africa, where, despite vast improvements, just 28% of the population was connected to the internet by the end of 2020, according to GSMA.

Yet the tech giants are taking the metaverse very seriously. Facebook rebranded itself to Meta last Octo­ber, to reflect its ambitions in the metaverse, and announced 10,000 hires in a new $10bn metaverse division tasked with creating XR hardware, software and content.

In January, Apple’s share price jumped 8% on the same day that CEO Tim Cook announced his firm was investing in the concept. Brands, banks and musicians are all planning their futures in the metaverse, and JPMorgan Chase predicts the concept could eventually realise $1 trillion in yearly revenues.

“The metaverse will take time to develop as its boundaries have not yet been clearly defined,” says Rupantar Guha, project manager for thematic research at GlobalData. “But if the big tech companies succeed, the metaverse will represent a new iteration of the internet, where users will flip through virtual worlds instead of apps and tabs on internet browsers.”

Experts believe the concept will emerge over time as new hardware technologies come to market to enhance the virtual realm, including improvements to graphics, sensors and visual aids. Metaverse users create parallel digital identities through avatars, and can socialise, work, game and shop using crypto­currencies.

African companies move forward
While much of that may seem a pipe dream in Africa, some firms on the continent are already alive to the possibilities that the metaverse can provide. Nigeria’s Thrill Digital, founded by Delz Erinle and artist Niyi Okeowo, uses AR and VR, crypto and gaming, to create a fashion metaverse.

The firm won a $40,000 grant from Epic Games, a US video game and software developer investing in metaverse development, to start Astra, a play-to-earn crypto game where players try to amass as many tokens as they can within an allotted time to win real-life luxury fashion items.

“The metaverse is built for our virtual selves, the person we’ve crafted on Instagram, or the voice we’ve built on Twitter, and so the next step is to have a 3D representation of this self, and to build services around that,” says Erinle.

It’s a rudimentary outline for now, but Thrill Digital’s team of African developers are building a metaverse made up of digital “cities,” where partnered brands can sell digital fashion to buyers wishing to adorn an avatar, or physical items to be shipped around the world.

“In the metaverse it will be like a blank slate, people can be whoever they want to be,” says Okeowo. “Your avatar can be ultra-realistic and lifelike or you can change your hair every day, if that allows you to accept yourself to the fullest.”

Morgan Stanley estimates the virtual fashion market alone could be worth more than $55bn by 2030. Digital couture garments are costing in excess of thousands of dollars as non-fungible tokens (NFTs) provide proof of digital ownership. Nike premiered Nikeland on gaming platform Roblox to reach 47.3m daily active users worldwide, and Gucci recently sold a virtual handbag on Roblox for $4,115.

Digital real estate booms
The decentralised metaverse will be built on Web 3.0 blockchain technology – a kind of successor to the mobile internet – with financial assets in the form of NFTs generating the cryptocurrency needed to build a digital economy.

Crypto has propelled a virtual real estate boom, as buyers snap up parcels of digital “land”. In December, Barbados used cryptocurrency to buy “land” in Decentraland – one of the leading metaverses – to build a new embassy, and Gucci recently paid $2.43m for a plot of virtual real estate to build a virtual store selling digital clothing.

The value of digital real estate is determined by its scarcity and location within each platform: Decentraland, for example, contains 90,000 parcels of land. When all the parcels of land sell out, brands, businesses and virtual event organisers will have to lease the land from the owners. Buyers get a digital receipt of the property with an NFT, and can arrange a mortgage, before contacting a real world architect to design a building.

The architects then send their designs to a 3D modeller to work with coders. Sales of real estate in the metaverse topped $500m in 2021, and it’s expected to double this year, according to MetaMetric Solutions, a consultancy firm. Whether that is rooted in speculation or genuine economic potential remains to be seen, but some African companies are talking up the sector.

In Africarare, Africa’s first metaverse, artist Norman Catherine has developed a collection of 3D avatars for consumers to wear. The firm has a plan to build the virtual realm of Ubuntuland, which will contain villages, art galleries and wildlife parks. Land is to be rented or sold for business meetings, art exhibitions, and other events, and the realm will be further developed in collaboration with architects, coders and software developers, says the firm.

“We make special events and campaigns for brands, including a walk-in virtual art gallery for a bank that you can enter with a headset. It’s going to be a way for either a global brand or an African company to own a virtual piece of Africa using these worlds. It will shift the whole concept of work,” says Mic Mann, CEO of Africarare.

Opportunities for African brands
The metaverse could also provide a significant opportunity for African brands to advertise themselves. Captive metaverse audiences present a massive opportunity for brands, marketers and advertisers, says Jason Velliquette, executive vice president of digital marketing consultancy R3.

“We need to think about the metaverse as a continuous evolution and journey. And so marketers and brands need to make decisions about how they’re going to participate with this evolution. Amazon already has this opportunity with some products where I can take an AR version of a couch, and see how it fits in my living room. And what about being able to sit in a Tesla and see the entire dashboard and learn the different controls?”

In the future, as customers walk through virtual worlds, brands will be able to buy billboard placements, and over time, the metaverse could provide new mediums for storytelling. African brands could invest in sophisticated 360-degree videos for specific ad campaigns, and create full-scale experiences that allow users to interact with a product and influencers.

One of the greatest attractions of the metaverse for early adopters is its decentralised nature, as users take advantage of blockchain technology to enjoy user-owned experiences.

The personal information that brands collect could be enormous. Advertisers currently gather information from clicks and time on sites, but in the future they may be able to learn how much time a consumer spends reading a label, or whether they picked up and touched a particular product, while being able to read biometric data like facial expressions and eye movements from headset wearers.

That raises the question of metaverse regulation to ensure safety, privacy and standards.

“We expect self-regulatory actions in the emerging metaverse platforms over the next couple of years, but regulators will eventually police these platforms as more countries adopt GDPR-like privacy systems to protect user data from being misused for profits,” says GlobalData’s Guha.

Future possibilities for the metaverse in Africa
But for most African users, getting lost in in a virtual shopping mall or having their biometric data swiped by a company is far down the list of concerns. For all but the most digitally savvy and economically active, accessing this new world anytime soon is unforeseeable.

Internet bandwidth speeds lag behind most of the rest of the world, and data prices are high. Only half of Africa’s population has access to 4G mobile internet networks, and sub-Saharan Africa ranks as the most expensive region for mobile data.

Yet as Africa’s population becomes the largest workforce in the world by 2035, big tech firms insist that the metaverse will gradually open up economic opportunities in Africa, pointing to its relevance to the evolving post-pandemic world of work.

Derya Matras, Meta’s vice president for Africa, the Middle East and Turkey, says that work in physical offices by software developers, architects, crypto accountants, artists, gamers, storytellers, educators, marketers and project managers will increasingly start to migrate into the metaverse.

“We know there is huge talent here on the continent, and nowhere is it more exciting to witness than in the creative and tech space, with local solutions being created for global problems and challenges,” she says. “We see technology giving people new opportunities every day to become entrepreneurs and content creators, and I believe the metaverse has a big role to play here.”

Meta has deployed its two-year $50m XR Programs and Research fund to build the metaverse, which includes funding for its “Future Africa: Telling Stories, Building Worlds” programme. The programme will see the company partner with Africa No Filter, Electric South and Imisi3D to support creators amplifying African voices and pushing the boundaries of digital storytelling.

By using immersive technology such as 360 video, VR, AR and mixed reality, creators can receive funding of up to $30,000 and mentoring from Meta to grow their skills.

“The future of social technology is changing, and so are we. It won’t happen overnight, but over time, the metaverse will unlock new opportunities for people and communities globally and across Africa,” says Matras.

Problems of affordability
Another major challenge is the affordability of technology for consumers.

Original story on African Business

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