Macromegas #42 - Facebook, Roblox: a virtual life better than the real thing?
Facebook, Roblox: a virtual life better than the real thing?
Hello Friends,
And happy Friday!
In case you really did not follow tech news, Facebook & Mark are in the news again about their Metaverse project.
But this time, big announcement. Facebook officially stated it would be spending “billions” annually in the development of its Metaverse.
The headlines are entertaining to say the least:
As you might have noticed in previous issues of this newsletter, I do like sharing about this topic:
Let’s start with a recent essay by the one and only Ben Thompson (Stratechery).
The theses: Roblox, a social gaming platform of which GenZs are particularly fond of, is very well positioned to build its own Metaverse.
Disclaimer: I am an investor both in Facebook and Roblox.
The Roblox Microverse 10min
The Evolution of Video Games
"An average of 36.2 million people from around the world come to Roblox every day to connect with friends. Together they play, learn, communicate, explore, and expand their friendships, all in 3D digital worlds that are entirely user-generated, built by our community of nearly 7 million active developers. We call this emerging category “human co-experience,” which we consider to be the new form of social interaction we envisioned back in 2004. Our platform is powered by user-generated content and draws inspiration from gaming, entertainment, social media, and even toys." - Roblox S-1 Reports
The most obvious difference between Clubhouse and podcasts is how much dramatically easier it is to both create a conversation and to listen to one. This step change is very much inline with the shift from blogging to Twitter, from website publishing to Instagram, or from YouTube to TikTok.
More importantly, that graphic was about creation, not consumption, and in that regard, video games fit quite nicely:
Step 0 — Pre-Internet: The primary way to distribute video games was on consoles, which were controlled by the console makers; computer gaming was more open, but still required significant distribution capabilities. This was the newspaper era of video game publishing.
Step 1 — Democratization: The Internet made it possible to distribute games directly, meaning that anyone could be a publisher; over time the increase in broadband penetration made casual cloud-gaming (originally via Flash and later on Facebook) much more accessible.
Step 2 — Aggregation: Mobile dramatically increased the market for video games by ensuring nearly everyone had a video game device in their pockets. Note that this increased the market in two ways: first, there were more potential players, and two, all potential players had more opportunities to play games. Mobile, though, meant App Stores. This was a boon in that it made it easy to distribute video games in a way that customers were willing to trust and experiment with, and built-in payments unlocked entirely new ways of making money. It also meant that App Stores were the only way to reach customers, and you had to pay 30% for the privilege (these advantages and disadvantages are, of course, the exact same).
Step 3 — Transformation: This step is when the medium in question becomes something fundamentally different because of the Internet. I explained in Clubhouse’s Inevitability:
The Metaverse
"Some refer to our category as the metaverse, a term often used to describe the concept of persistent, shared, 3D virtual spaces in a virtual universe. The idea of a metaverse has been written about by futurists and science fiction authors for over 30 years. With the advent of increasingly powerful consumer computing devices, cloud computing, and high bandwidth internet connections, the concept of the metaverse is materializing." #Roblox #[[S-1 [[Reports]]]]
The Roblox Platform has a number of key characteristics:
Identity: All users have unique identities in the form of avatars that allow them to express themselves as whoever or whatever they want to be. These avatars are portable across experiences.
Friends: Users interact with friends, some of whom they know in the real world and others who they meet on Roblox.
Immersive: The experiences on Roblox are 3D and immersive. As we continue to improve the Roblox Platform, these experiences will become increasingly engaging and indistinguishable from the real world.
Anywhere: Users, developers and creators on Roblox are from all over the world. Further, the Roblox Client operates on iOS, Android, PC, Mac, and Xbox, and supports VR experiences on PC using Oculus Rift, HTC Vive and Valve Index headsets.
Low Friction: It is simple to set up an account on Roblox, and free for users to enjoy experiences on the platform. Users can quickly traverse between and within experiences either on their own or with their friends. It is also easy for developers to build experiences and then publish them to the Roblox Cloud so that they are then accessible to users on the Roblox Client across all platforms.
Variety of Content: Roblox is a vast and expanding universe of developer and creator-built content. As of September 30, 2020, there were over 18 million experiences on Roblox, and in the twelve months ended September 30, 2020, over 12 million of these were experienced by our community. There are also millions of creator-built virtual items with which users can personalize their avatars.
Economy: Roblox has a vibrant economy built on a currency called Robux. Users who choose to purchase Robux can spend the currency on experiences and on items for their avatar. Developers and creators earn Robux by building engaging experiences and compelling items that users want to purchase. Roblox enables developers and creators to convert Robux back into real-world currency.
Safety: Multiple systems are integrated into the Roblox Platform to promote civility and ensure the safety of our users. These systems are designed to enforce real-world laws, and are designed to extend beyond minimum regulatory requirements.
Growth at Roblox has been driven primarily by a significant investment in technology and two mutually reinforcing network effects: content and social.
In short, Roblox isn’t a game at all: it is world in which one of the things you can do is play games, with a persistent identity, persistent set of friends, persistent money, all disconnected from the device that you use to access the world. That is the transformational change.
Now, you’ll be telling me: but who will prefer spending most of their waking hours in a virtual world rather than in real life?
For one, younger generations are already doing so.
Then, we explored why the demand is far from negligible in older generations throughout Macromegas #35 - Aging & Entertainment.
Last, the demand should be highest amongst low-income populations. This is what a16z’s Marc Andreessen is arguing in his brilliantly non-politically-correct personal style.
The Dubrovnik Interviews: Marc Andreessen - Interviewed by a Retard 25min
This is a paraphrase of a concept articulated by Beau Cronin: "Consider the possibility that a visceral defense of the physical, and an accompanying dismissal of the virtual as inferior or escapist, is a result of superuser privileges." A small percent of people live in a real-world environment that is rich, even overflowing, with glorious substance, beautiful settings, plentiful stimulation, and many fascinating people to talk to, and to work with, and to date. These are also *all* of the people who get to ask probing questions like yours. Everyone else, the vast majority of humanity, lacks Reality Privilege -- their online world is, or will be, immeasurably richer and more fulfilling than most of the physical and social environment around them in the quote-unquote real world.
The Reality Privileged, of course, call this conclusion dystopian, and demand that we prioritize improvements in reality over improvements in virtuality. To which I say: reality has had 5,000 years to get good, and is clearly still woefully lacking for most people; I don't think we should wait another 5,000 years to see if it eventually closes the gap. We should build -- and we are building -- online worlds that make life and work and love wonderful for everyone, no matter what level of reality deprivation they find themselves in.
Here's a thought experiment for the counterfactual. Suppose we had all just spent the last 15 months of COVID lockdowns *without* the Internet, without the virtual world. As bad as the lockdowns have been for people's well-being -- and they've been bad -- how much worse would they have been without the Internet? I think the answer is clear: profoundly, terribly worse. (Of course, pandemic lockdowns are not the norm -- for that, we'll have to wait for the climate lockdowns.)
Genuine request: if you are sick and tired of the Metaverse already, simply let me know by answering this email, and I’ll try not to write about it for a week or two.
If you are enjoying this glimpse into what our future will most likely look like, feel free to subscribe if you have been forwarded this email, or forward it to other smart & curious friends.
Thanks for reading, and have a real good weekend,
V