In the fifth episode of Meta Minutes, our host Rene Schulte talks about the seven rules of Metaverse and the importance of inter-operability, with our expert guest, Tony Parisi.

Transcript

Rene - Hi! Welcome to Meta Minutes, your bite-sized pieces of the Metaverse. My name is Rene from Valorem Reply and today we're going to talk about the seven rules of the metaverse and of course the importance of interoperability. And for this i'm honored to have a special expert guest today, no one else than Tony Parisi. Hi Tony and welcome to the show. How are you today?

Tony - Hi Rene. Thanks for having me. I'm doing well, thanks. I'm coming in here from my home in San Francisco.

Rene - Awesome! Well can you tell us a little bit about your background and about yourself as it relates to the metaverse.

Tony - I have been working on the metaverse since the early 1990s, almost 30 years now and I would say almost continuously with a few small breaks. I came up in software engineering, i'm a trained professional software person and I moved out to silicon valley to pursue my dreams and on the internet from Boston area where I was originally working in software in the early 1990s. And I met this fellow named Mark Pesci and we started working on a project to do 3D graphics in real time on the internet in the early 1990s, a project called VRML that launched around 1994 that stands for virtual reality modeling language and this was a first attempt to deliver 3D graphics into a web browser have that content be integrated with other webcontent so you could click around and that might launch web pages and all these kind of really wonderful ideas that were as it turns out a couple of decades too early to implement in any way with efficiency and with scale the way we can do now and i'm sure we'll get to that as as we keep talking but after that experience. So VRML became an early internet standard and a lot of companies and individuals, academics practitioners worked in the area for the better part of the 90s and then it kind of all stalled commercially because other things were going on like the rise of the commercial internet for example and then after that social media but during all of these periods I kept working on real-time 3D graphics, like I said, almost uninterrupted for over 20 years and various capacities. Most recently, I worked at Unity technologies for nearly six years, overseeing our company's expansion beyond the game industry. A lot of people were using unity's real-time 3D game engine tech to build VR and AR with the new hardware like oculus and hololens and magic leap and vive that was comingout in, you know, 2014, 2015, 2016. So I joined unity in 2016 to help us figure out how to create products and have lines of business beyond the game industry because even though the technology heavily overlapped with game tech, the business, the workflows, you know, how you actually create content, it's all very different. Say you were in automotive industry or in film and entertainment or advertising and I helped us figure out how to get into all those industries and most recently Unity, before I left, was focused on advertising and e-commerce with mobile 3D on your phone, augmented Reality being able to turn the phone's camera on and try on products you know, sunglasses on your face, furniture in your house, these kind of things. Butt hen I left to pursue my original dream of creating the open metaverse and you know, we can talk about that a little bit but that's what led me here today. I'm also a musician and an artist and so i'm very keen on helping creators succeed in this world which is Unity's mission which I was you know happy to help with for several years. But now you know, the metaverse is bigger than any one company. So I broke free. It turned out only for a couple of months and I ended up taking a new job and I guess, we'll talk about that in a minute. But it was a very special set of circumstances, so where i'm at now is what can I do to help people in the industry understand what the metaverse is? Where can I make contributions on product and technology? And then, of course, how can I help us all evangelize this beautiful future together, which is real-time 3D computing to help everyone in all walks of life, all the use cases, any platform you know not tied to a VR headset, all these kind of things. So that's where i'm at today Rene, and i'm delighted to be here to be able to share my story with you.

Rene - Awesome. Thanks for sharing your story and I can tell you and i'm showing my age now. I used VRML in the university, like we did some projects with it. It was amazing. First time we had 3D in the browser like look, I mean everyone was like flash, what is this? This was fantastic. You were always, say so ahead of times right with VRML back then. But anyhow, let's talk about, let's talk about your great article that you recently wrote but recently it was still already a few months ago, but you wrote this article called seven rules of the metaverse, which is really great and I think it's also in a reference to the seven layers of the metaverse model that Jon Radoff released, we actually interviewed Jon a few episodes ago. But anyhow, let's talk about your seven rules because your post gained a lot of momentum for a good reason and many are referencing it these days. So can you just briefly explain basically your seven rules for the audience?

Tony - Yeah we'll do and i will give you a little context and interestingly it was not at all connected to those seven layers that's a complete coincidence. I think the number seven is resonant for a lot of people and it turned out it was a number I wanted to work with but I will give you some background in context. So as we're all pretty probably aware now, last summer Mark Zuckerberg said the word metaverse, the company Facebook rebranded to Meta and the company was all in on building this future of the metaverse and that sparked so much excitement and attention in the industry that just a few months later everyone was saying metaverse the word is just almost starting to lose its meaning. It's being said so much as you know and a lot of people started emerging with their thoughts about what it might be purported experts on what this is, you know, marketing consultants, technology experts, venture capitalists, all saying this is what the metaverse is and of course I was standing by here watching a lot of this with some amount of amusement and occasionally frustration as people were saying all kinds of things that were, I would consider to be not well informed. Possibly not just naive technically and not really having a sense of some of the history that's gone into this because if you look back at the history of the development of technology of the metaverse, it predates my involvement as well. I mean it goes back to really the initial original augmented and virtual reality hardware that go way back to the late 1960s. So we're talking about over 50 years of development of technologies and then through waves of trying to commercialize VR my work in VRML, everything that went on in second life and those kind of virtual world systems that happened all now 20 years ago. Second life was founded amazingly bringing us up to today with these what I would call prototype metaverse worlds these large-scale game worlds like Roblox, Fortnite, of course, minecraft, highly successful everything going on and another group of technologies people are calling the metaverse web3 with people, you know, showing off NFTs and doing all this stuff and saying that's the metaverse and I just started saying timeout and I actually started this by just sending a series of tweets. I just sent tweets and I just started with rule number one and I'll get to that in a minute and then over the course of maybe a week I sent out all these seven tweets and then people started picking them up and retweeting them sometimes even stealing them and just throwing them in slide decks until somebody would call them on it on twitter and I decided maybe I should actually write what I'm talking about and put some thought into it more than just firing off these you know pronouncements from the ether, if you will, and so I got a bit thoughtful about it and I really did a lot of soul-searching and recollection of my journey through this and why I was doing this for so long, what motivated me, you know, what really motivated me as a pursuit of an open metaverse that anybody can participate in 3D graphics for the good of every one and built together in a collaborative way much like the internet or the worldwide web and anything that was too far off from that. I thought, well, okay we're not gonna... that's not gonna be successful. I believe that what I described in the seven rules that i'm about to explain to you describes something that is the inevitable state. I'm not gonna tell you what it looks like graphically, i'm not gonna tell you who's gonna be successful in this commercially. That is all open and up for grabs but what I can tell you is, if we're going to have a global 3D communication structurem, it's going to look more or less like these seven roles I put out there. It's going to have these characteristics. So very quickly, i'll go through them Rene. Rule number one - there is only one metaverse, this is one that was really getting to me as people are using metaverse in the plural. They're saying so-and-so is building a metaverse, look at all these metaverses out there that makes no sense. Just simply going back to the original definition of the word which came from this wonderful science fiction novel called snow crash written by a brilliant author named Neal Stephenson, who, now is my colleague at my new startup and i'll get to that later. And you know he described a future internet that had a virtual reality and 3D interface to it that was, it was all inter-connected but it was the internet so you know there's only one of those. I mean if you don't take into account the national restrictions, say in some countries where they lock down their internet, it's all built on one global communications infrastructure and it's mostly open and interoperable and so I thought, it was important to call that out because I think words matter and you know, talking about these things in the plural means we're already building into our thinking. Fragmentation experiences will work in one platform and not another content that I make once but I can't share it with everybody. Consumers, citizens, users, participants, having to have multiple ways to access it and log into multiple systems and all that just sounds wrong. I mean it's not the way the internet works in general. Yes we have social media accounts and all that but the internet's basically free and open. I give you a url and you can access that experience. It needs to work that way with the metaverse. Rule number two - The metaverse is for everyone and what I mean by that, is it sounds sociological and political and it partly is, but I mean it here more as a statement of product technology ethnography to say that it needs to accommodate any kind of use case. This isn't just, you know, you should not have to be a gamer. You should not even have to be necessarily a consumer. Maybe you're using this kind of technology to do something for corporate use, training and so that needs to be thought of for all use cases and designed that way. Rule number three - Maybe my favorite, nobody controls the metaverse. It is not going to be supplied by one company no matter how great, how powerful that technology is. No matter how wonderful and inexpensive that headset might be, no matter how free that search utility might be, free and I put in quotation marks, here no one company will control it. Even if one company tries, it will not succeed. It simply will not reach the scale required to hit all these use cases and to be able to solve all problems for all people and honestly in the wake of what we now call web 2, I don't think people are going to put up with it and ultimately regulating authorities and governments probably won't put up with it. As we've seen with the recent things that happen with GDPR and advertising and other movements like that governments move slow but they finally get on the case and I just think consumers are fed up so not to mention what's going to happen with creators who are up in arms by creating content and not seeing the fruits of their labors. They don't make the money on it, the platforms get all the money. Nobody controls the metaverse. Rule number four - The metaverse is open. I mean this is to me just obvious because I come from a world of open standards and technology. We would not be having this conversation if there wasn't for open standards. The standards that support the internet and open communication. The standards for video codecs, so we can see each other audio and so on, the lights in my house that are illuminating me right now, the power, these all are not fun things to build but they have to be built so that we can all share and collaborate and so the metaverse won't be any different. It'll be built on open standards that are, you know, eventually hardened by committees and written into hard specs but start with open collaborative projects and open source code. Rule number five - The metaverse is hardware independent. This one is key. I think, a lot of people were starting to freak out by the concept of a metaverse because they thought we were all going to be wearing a VR headset 20 hours a day and trapped in the matrix. That's not going to happen. I mean that's a great device but how you know how much a day, how many minutes a day do you wear yours, Rene. Half an hour, 20 minutes an hour. You're playing games, there's some great use cases or you're doing some corporate training where you want to shut out the whole world and work on a new piece of equipment or learn a procedure or learn a language maybe in an immersive way. There's so many use cases for it but we're not going to be in there all day and there's so many other form factors. There's augmented reality in terms of our phone, there's mixed reality headsets, there are flat screens like the ones we're on right now. The metaverse needs to reach all constituents that way and it also needs to be accessible with people for people with disabilities and so the idea that one piece of hardware is going to be our entry point, this just makes no sense and it artificially limits use cases. Rule number six - The metaverse is a network. The metaverse is not a program. It's not an application. It's not even the, let's say the future browser we might access it through. It's a bunch of computers talking to each other exchanging information that's what the internet is too. What we then perceive on top of that are the you know skins the interfaces, the browsers or the apps that connect up to that network. But at its heart, the metaverse is computers exchanging information. It's just like the web but this information will be predominantly spatial. It will be 3D organized, it will be avatars, it will be spaces, it will be physical. You know digital twins of physical objects and so that's what it is in its essence. And if you think about it that way and start building that way you'll build component pieces that work together. And then finally rule number seven which is comprehensive and comprises all the rest of the six rules and could be the one rule but it would require so much explanation, I had to write seven. It's really just the internet. The metaverse is the internet. It's the internet with a spatial interface. it's the internet in real time. It's the internet with real-time 3D objects, people, places and it's probably a decentralized one as well as we're seeing. I mentioned web3 earlier. Those movements are underfoot and they're not going anywhere. So this will be operated by lots of participants, again potentially and hopefully not controlled by too few players and then we'll all have a loving level playing field where we can all participate, create and share together. Obviously some of this sounds utopian the way i'm saying it but these are aspirational in the sense that we should try to make these true as much as possible. But I also do believe to the every fiber of my being that this is the way it's going to have to be if the metaverse will reach global scale and provide the greatest amount of utility for the most people.

Rene - Yeah. Awesome explanation and I fully agree with what you have said especially that it needs to be open and it's basically the new internet and that's also the broader understanding which a lot of folks like you were alluding to don't realize, some just use the metaverse term on this more narrow understanding. This is just beyond all right like this is the stuff we have been calling XR, Mixed all of this. Oh this is just the metaverse now but it's not like the vision really like you were saying, right and i'm fully agreeing but, of course, there's still a long way to realize that fantastic vision in particular the open inter-operability might become really challenging especially with you were mentioning a little bit with the current large tech players and we all know from the history like with web 2, you have basically these platforms and these platforms also like to build these kind of walled gardens and keep people basically on their platforms for various reasons of course but how do you think we can overcome this. Like, so that we just have one metaverse which can be a multiverse under the hood but with open interop between those. So in the end from the user experience perspective it looks like one, single, homogeneous metaverse. So, what do you think is the way to get there?

Tony - Well first of all I would say that even the companies who are the larger players in web one or web 2 understand that this ultimately needs to be open and are talking about it that way. I mean maybe some of them are just paying a lip service as we would say and they're not going to really follow through but any company that's significant in this space is already embracing the idea that it needs to be open I think there's a general agreement that everything needs to be that way in orderto achieve the scale that's possible and so we're at a good starting point where I think most of the industry players are approaching it from an open collaboration stand point and that is the folks that you would think of may be as the walled garden types from web 2. So including meta and these kind of companies the game engine companies have historically not been that fast on the uptake with open standards. They haven't had a lot of motivation because game dev is mostly like make a package title distribute it but when they start looking at other industries and epic and Unity both in particular power lots of other industries like the automotive, film industry, advertising. Those industries needless vendor lock-in, they have different distribution needs. There's a lot of different factors in play that make it so that the customers require things to be more open and interoperable and then finally again I mentioned this before about creators, I think at this point creators are demanding it. They're tired of creating a piece of content that will only work in one system and in particular in 3D. I wrote a blog post about this about, you know, being able to build content to last many 3D creators have been burned by creating something for one engine, let's say shockwave 3D. We'll take that as an example from over a decade ago and then the products just discontinued and they literally have lost all their work. Maybe they made their money. They were doing a project for a higher but that doesn't mean they don't still want to show it in their portfolio or possibly reuse it in other contexts where they're able to do that per their contract and they have to redo their work and that is just absurd, right? I mean if nobody makes webpages thinking the web page is going to just break tomorrow, I mean, you need to maintain them. It may break in 10 years but it's not going to break in six months when somebody decides, you know a single vendor, to discontinue a product, right? So there are a lot of forces in play plus again the need to get paid that I think are, you know, on the part of creators that I think are going to drive openness for a while. I think we're going to see probably a green field of the next three or four years where there is lots of open spirit and open collaboration that will drive this across. Even the biggest players of the industry and then, of course, as the stakes start getting higher and as things become more evident and to, you know, where things are going, where the real money is, we'll probably see lots of attempts to consolidate and take control of various aspects of it. But we don't even know what those aspects will be because we don't know what the big modalities are going to be in the metaverse. Is it, you know, what's the next uber for the metaverse? So the next google or the next YouTube? We don't know these large players and even the mif you follow the web3 logic and how venture capitalists are funding web3 and all that. They don't believe it's in maintaining control over the platform as much as it is providing a set of open service layers that really scale up where you don't need to make more than a few percent on a transaction but there's lots of them, right? You don't need to have necessarily monopoly or duopoly market domination to have a really wildly successful business with these blockchains and everything. So it's going to be really interesting. So I think what could hinder or slow this down is resolve energy. These problems are tough to solve Rene. They're not fun. Oh you know, it's hard enough to make a 3D engine. Now i'm going to make one, where my content will work with somebody else's and maybe my competitors. It's counter-intuitive for a lot of people's motivations but then you just need to line up the motivations. I think people need to understand, where's the real value? Where's the business? What world are we trying to build together and start from there. So i'm hopeful but yeah, I think there's going to be, you know, those kindof challenges and just kind of keeping it together and we're doing hard work that is required for interoperability.

Rene - Yep and also like you said, there also needs to be some kind of responsibility that we ,as developers, also need to think about, right? Because we are also working on this and also the openness like you mentioned, right, we we have to think about, like, on the products we work and what we're building, that we're building it also, in a responsible way. Because we're not just living on an island right? We live on this beautiful planet as well and the metaverse is just an addition to it and should not be replacing this beautiful planet, right? So we gotta keep those in mind. So, a lot of brands are also entering the metaverse and some of them are offering virtual assets like digital fashion, sneakers, and what not. Often times in the form of NFT. So basically these non-fungible token that are connected to the blockchain that basically is connected to your wallet. So everyone knows that you own this. But where do you see the metaverse potential for brands but also for small integrators you mentioned, because they can now directly monetize their work right? But is there also a risk associated, for example, that only certain big players with a lot of stake will basically control the whole ecosystem?

Tony - Yeah, so when it comes to brands the early experiments are interesting. We're seeing really exciting content being made in environments like Fortnite and Roblox, for example. But those are not inexpensive projects. So you know it tends to be luxury brands who are spending the time and effort and money there and the creator tools are not really open and easy and you're also making content that's essentially to reach a specific audience inside that game, right? And so it might work for a marketing campaign might, you know, a specific campaign to reach a certain kind of audience for a certain period of time. But it may not be the right brand content to invest in on your own website or for NFTs. So there's a lot of different factors here and and i'm scratching my head a little bit on some of the brand activations I have seen so far. I wonder aloud and i've said this before, i've asked even the folks at Epic about this. Why would Ferrari want to be in Fortnite? The average player age is 18 to 24. Those people aren't buying Ferraris. What's going on with that? Is it simply experiment? Was it just for the press release? Was it just you know for the learnings and so I don't know how long we'll see those kind of brand activations? Or you know Ralph Lauren and Roblox. I'm not getting that one either. I understand why Nike wants to be in Roblox. Eight-year-olds buy nike shoes right? So i'm a little mystified by some of it. I think some of it's simply experimentation. Wanting to be out there first as a brand. But over time brands will need to make investments that are much more inline with the with the ROI, the return on investment, makes more sense. That the investment's not as high that at the cost of creating contents more like normal ad creative and the return starts to be, I can run this on multiple platforms to multiple audiences when you make, you know. A video advertisement you don't make it expecting it to only run on one platform, right? For example, so when it comes to the smaller indie creatives this is all a game about, you know, are there going to be inexpensive or free tools for them to use? Are there going to be these ROI places where if they're doing project-based creative for customers, you know, they can actually be paid to do that and paid well, or if they're doing their own independent content creation, do they have a way to reach audiences? And this one i'm particularly passionate about Rene. Especially, when it comes to music, I mentioned i'm a musician, I was thinking about launching some of my own projects and so a year ago I started looking at what's going on with NFTs and music and that's very interesting because independent musicians who've had areally rough time in particular during the pandemic, are turning to NFTs now as a way to have a deeper connection with their fans and make money and they're making more money than they could ever make on the streamers. You make three thousand dollars US and a million streams on spotify, you make less than that on a million streams on Apple music. But one NFT drop can make you tens of thousands of dollars of US money by reaching one or two thousand fans. You don't need to reach millions of people to succeed. You need to find your fans. This is a very hopeful development in the evolution of the creator economy. And you know, now these platforms enable this stuff at scale in a way they didn't before. So i'm really hopeful and again in particular musicians between the file sharing stuff that happen with napster and then the streaming services and then the pandemic, they've really just had a seriously difficult time just making a living. So i'm watching that space very closely to see how that goes. And I think you can make the case also for independent filmmakers, writers, anybody who's a content creator and has had to go through publishing and distribution networks and systems of the past that we are at a turning point where they're going to have better tools for doing all that and reaching their audiences and forming a relationship with them and then when their audiences get the NFTs, they're not just being patrons in the sense that, hey I was going to give my money to Violeta because I love her music and I love her voice and here's my 100 I bought an NFT or whatever more than I pan a record because i'm, you know, i'm leaning in and learning about this stuff, But I now have benefits which are that I can go to any of her concerts anytime I want with that NFT. So there's some utility in these NFTs now, where they're unlocking consumer value as well. So this is the exciting thing because those are code they're not just the bitmaps or the sound files. It's actual code in a smart contract that confers certain benefits and you know scan the QR code, let the person into the concert and all of these things were able to be done in previous iterations with earlier technology but never with these combinations and at the scale through these common mechanisms of, say you know, ethereum blockchain NFT and other ones coming on new blockchains.

Rene - I love what you said. Especially the example you gave with that NFT. You got lifetime console access kind of a thing. So this is a kind of nice status like better than an airline kind of a status. I love this and like you said, if you have creative people that you know come up with these kind of innovative ideas also to monetize their confidence on. This is great because they can reach the whole audience worldwide without borders and this is also what i'm really excited about. The NFT and the web free aspect of the whole decentralized protocols. It could be blockchain, it doesn't have to be, I know you guys are building like a layer on top and to solve all the issues that come with certain blockchain protocols. So yeah, exciting! All right, well, we are already at the end of the show. We could talk for many more hours. It's so insightful, and thankyou so much, Tony for joining us today and sharing your insights. Very much appreciated.

Tony - Well thanks for having me Rene. It was a real pleasure and i'll see you in the metaverse, i guess.

Rene - Yes! Well and thanks everyone for joining us for Meta Minutes, your bite-sized pieces of the metaverse. Watch our blog, follow our social media channels, subscribe to YouTube if you want, and of course visit the website to watch all the previous episodes and to learn about Meta Minutes. Well, take care, see you soon in the metaverse.