Metaverse Building Blocks Will be Commercially Deployed Earlier than Full Environments

As with all other applications, metaverses and metaverse-similar use cases  will require connectivity, data centers and cloud computing providers in the value chain. 

From a digital infrastructure perspective, internet of things, blockchain, edge computing, cloud computing, artificial intelligence and networks are part of the metaverse value chain. 

That means connectivity providers might play parts of roles in IoT, blockchain, edge computing or cloud, while obviously functioning most directly as connectivity providers. Data centers and computing-as-a-service suppliers will have a wider range of roles in edge computing and hosting, 

source: Sketch Bubble 

Of course, it is often difficult to define what we are talking about when we discuss “metaverse.” 

Most attempted definitions for metaverse include the idea of virtual worlds where real people interact in real time. 

Beyond virtual worlds, metaverse technologies typically include use of avatars, three-dimensional representation; bots; virtual reality; cryptocurrency, blockchain; non-fungible tokens; social networks; mobile and other devices. 

But some of those technologies also will be used to support more-realistic experiences that are “less than” full immersion in virtual worlds such as gaming. Digital twins and conferencing provide examples. It is at least conceivable that such uses might initially be more important than full metaverse worlds. 

Value chains and layers are related concepts, in that regard. Since layers are fundamental to modern computing and software, it will come as no surprise that “metaverse” also might be defined in layers. 

source: Innovius 

In principle, it is possible to use many supporting capabilities for all sorts of apps that are not intended to be full virtual worlds. And since it is easier to introduce radically-new technology in a confined manner, rather than as a wholesale “rip and replace” operation, we are likely to see many building block technologies supporting higher degrees of realism before we see successful metaverses in commercial use.

Why Most Firms Applying New Technology Do Not See Outperformance

If business, nature and life have a standard distribution, then the percentage of firms able to turn artificial intelligence into measurable financial results should also be a standard distribution. 

source: Accenture 

Lots of firms, organizations and individuals make a living giving advice about how to boost performance of all sorts. But performance in any competitive arena is a standard distribution. In any market or endeavor, nearly 70 percent of actors will cluster around a median point. You would expect about 15 percent to notably outperform, while 15 percent significantly underperform. 

source: Cate Bakos 

The point is that even if all firms applied artificial intelligence, distributed computing, private neworks, internet of things or any other innovation you can think of, most would still perform at about the same levels as most peers. 

Up to 15 percent will outperform. But those firms were likely already the top performers. They are likely to be the firms already prepared to take advantage of new technologies. 

That is not to deny the value of advice about improving performance. It is to point out that, even with available to all, new technology will result in differential results. Underachievers rarely, if ever, become overachievers because of a single applied technology. 

` `1 -*/*++Perhaps some “average” entities can elevate their performance and become high achievers. More will simply keep pace with their peers and a few might actually underperform after embracing a particular innovation. 

Silver bullets rarely exist, or work. 

Diversify or Not? Sometimes it Works; Sometimes Not

Analysts and advisors often disagree sharply about what telcos ought to do about their “growth” initiatives. Some favor “sticking to core connectivity” while others emphasize “diversifying beyond connectivity.” Service providers have tried both approaches, sometimes alternating between them, as competitive opportunities and threats come and go. 

Some service providers are fortunate to operate in markets with high profit margins. In such markets the advice to “stick to connectivity” can make sense. Others have fewer chances to grow if they stick to connectivity. In those cases diversification makes sense. 

But almost every service provider explores some growth oportunities outside the core connectivity business. How to do so remains the challenge. Growth initiatives are risky, expensive and often do not move the revenue needle very much. That applies as much to edge computing as to internet of things or private networks, for example.     

Back in 2011, KT said it hoped to generate as much as 45 percent of its revenues from non-telecom sources by about 2015. It did not reach that goal, but all the South Korean mobile operators have significant non-telecom revenues, in the 25-percent range. 

source: Korea Herald 

But KT is still investing to diversify its revenue, as are rivals  SKT and U+.

At one point, AT&T earned as much as 40 percent of total revenues from non-telco sources, before reversing course and shedding its content operations to reduce debt. 

source: GSMA 

But most connectivity providers seem interested in growing non-connectivity revenues in some way. 

source: Twimbit 

As always, strategies that work for some service providers in some markets will not work for all service providers in all markets. Still, long term, if revenue growth in core connectivity services remains anemic (flat to negative growth) it is hard to see how most service providers will survive, much less prosper, without getting into new businesses of some kind.

Why Web 3.0 is Likely to Fail in Some Ways, Succeed in Others

The whole point of Web 3.0 is a change in the architecture of the World Wide Web, where decentralization of applications is founded on user control and ownership of their data. The extent to which decentralization succeeds is based in part on the actions advertising ecosystem participants take, since the whole “centralization” of the present web is driven by the revenues made possible by centralization and scale. 

source: TBD 

Also unclear is why any businesses that profit from “centralized” architectures will voluntarily give all that up. “They will be forced to do” is the retort. Value destruction, to be sure, has been part of most internet disintermediation of the past. 

One possible outcome is that value simply is destroyed at many points of the ecosystem, reducing the value of investing. Recall that past hopes for “decentralized value creation” often have failed. Some entities have made a business out of user-generated content, to be sure. But relatively few have done so. 

About the only participants that will prosper from Web 3.0 are the venture capitalists funding startups in the space. 

Some of us would argue that decentralization in the form of disintermediation is likely to happen, but without the more-futuristic advantages of “users owning their own data.” Blockchain will be foundational. But that is likely to fuel disintermediation of value chains, not a complete change of web business architecture.  

10-Gbps Home Broadband is Coming Within 3 Years

Faster home broadband is about as inevitable as Moore’s Law would predict. Having reached the point where top speeds of 1 Gbps are the current standard, we are heading to 10 Gbps over the next half decade or so. 

Which is one reason we are going to be hearing more about 20 Gbps internet access, and why firms such as AT&T already sell commercial service at 2 Gbps and 5 Gbps in lead markets. 

 

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source: Wik Consult 

Though the demand increase will mostly make sense for multi-user households, the historic increase in top of market speeds is quite linear. That does not mean most users will buy the top-rated tier of service. The general rule is that most consumers will buy the mid-tier level of service. 

source: Commscope 

source: Wik Consult 

source: Fiber Broadband Association. 

60% of Home Broadband Non-Buyers Don't Want It

The latest data from the U.S. National Telecommunications and Information Administration continues to show why the “digital divide,” measured as use of broadband internet access, has not closed faster. 

Nationally, 81 percent of respondents report using the internet. About 71 percent say they use the internet on their smartphones. About 49 percent say they connect their laptops, while 28 percent report connecting desktop computers. 

About 76 percent say they use the internet at home. As recently as 1998, 76 percent of respondents said they did not use the internet at home. About four percent claim the internet is not available where they live. 

Most users report using both mobile and fixed networks. Some 74 percent of respondents have a mobile data plan and 71 say they buy fixed network broadband. 

“When respondents were asked why they don’t use the Internet at home, nearly 60 percent said the main reason is that they don't need it or not interested,” says George Ford, Phoenix Center for Advanced Legal and Economic Public Policy Studies chief economist. 

That finding has been consistent since at least 2015, NTIA data shows. At the same time, “cost” has declined as a reason for not buying broadband access services. Some 18 percent of “non-using” respondents said using the internet was “too expensive.” 

source: Phoenix Center 

Half of U.S. Home Broadband Customers Buy Service at 200 Mbps to 400 Mbps

About half of U.S. internet access customers buy services running between 200 Mbps and 400 Mbps. That is a shift. Until recently, about half of the customers purchased services running between 100 Mbps and 200 Mbps. 

Roughly 70 percent of fixed network broadband customers purchase service at speeds of 200 Mbps or higher. Customers who buy gigabit or faster service have reached 13 percent, while customers of services operating between 500 Mbps and 900 Mbps are six percent of total. 

source: Openvault