Small toy figures are seen in front of Facebook’s new rebrand logo Meta in this illustration taken on October 28, 2021.
Given Ruvic | Reuters
In June 2018, Oculus CEO Jason Rubin sent an email to Facebook board member Marc Andreessen with the subject line “The Metaverse.”
“We believe that the right way to break through consumers’ indifference to VR is to deliver what they expect and want from the medium: METAVERSE,” reads the first slide of a 50-page document outlining a strategy for building a virtual world.
The three-year-old document, which CNBC has obtained, laid the foundation for the futuristic ambitions of Meta, the company that until now was called Facebook. CEO Mark Zuckerberg’s hour – long demo on Thursday, which culminated in the announcement of the new company name, was designed to portray a very different world than the one we currently inhabit at a time when Facebook is facing an uninterrupted shower of negative headlines. . to the addictive nature of its social media products.
Zuckerberg told viewers that the company sees the meta-verse, which will take five to 10 years to become mainstream, as the next frontier in technology – the place where people will live, work and play. His presentation came a few days after the company in its earnings report announced that Reality Labs hardware division will become its own financial reporting segment starting in the fourth quarter.
The paper sent to Andreessen in 2018 now resembles the first draft of the story. It imagined users floating through a digital universe of virtual ads, filled with virtual goods that people buy. There would be virtual people that they marry while spending as little time as possible in the real world, or “meatverse”. Rubin used the term “shock and awe” 12 times to describe the desired experience.
Andreessen Horowitz partner Marc Andreessen
Justin Sullivan | Getty pictures
Andreessen was a critical recipient, not just because he has been on Facebook’s board since 2008, but also because of his influence in this specific area. Through his company, Andreessen was an early baker of Oculus and also put money into Roblox, the gaming platform for kids that focuses on building his own metaverse.
The document was also sent to Andrew “Boz” Bosworth, head of Facebook’s hardware division, who was promoted to chief technology officer in July (starting next year) and to Hugo Barra, the company’s vice president of virtual reality. The person who shared the document with CNBC was not authorized to talk about it, but Rubin confirmed its validity in an interview Friday.
“The meta-verse is ours to lose,” reads one of the first paragraph headlines in Rubin’s paper. He went on to say that Facebook began to think of the concept of metaverse as a way to appeal to ordinary consumers because VR was not widely popular.
Facebook bought Oculus for $ 2 billion in 2014, and by June 2018, the company’s VR headset had amassed 250,000 monthly active players, according to the document. But despite hundreds of millions of dollars being invested in content for “early adopters and pioneers,” Rubin wrote that the devices had not caught on to non-hardcore gamers, and “the average consumer is waiting for the day when VR is’ fully baked ‘.’ “
“We believe that ‘fully baked’ means the meta-verse,” Rubin wrote. “Only such a massive launch will be able to get the attention of VR doubters and VR-maybe-tomorrow audiences.”
Rubin, whose title at Meta is now vice president of metaverse content, told CNBC that his paper was read quite widely, but it was not the only one that got attention.
“A lot of people had visions of the meta-verse at the time, and there were different documents floating around with different opinions,” Rubin said Friday. “I would like to have mine out there. That’s how we create things here on Facebook. There are a lot of ideas, a lot of people, and they boil down a little bit. I want to think some of it was useful.”
‘We must act first’
Rubin predicted in the newspaper that the project could potentially be built in four years and that Facebook could handle it alone. But he now realizes that it will take more time and that Meta will have to partner with a wide range of companies instead of owning and controlling the entire system.
“It’s a different way we’ve developed our mindset,” said Rubin, a former leader in the video game industry. “We have to work with others, we have to build it in many steps because it’s going to take a long time.”
As he wrote the document, Rubin indicated that he was not sure how much time Facebook would have. He just knew it was important to “go for the kill” and surpass the competition
“The first metaverse to gain real traction is likely to be the last,” Rubin wrote. “We have to act first and go big, otherwise we risk becoming one of the wannabes.”
Facebook had the potential to effectively shut competitors like Google, Apple, Sony, HTC and Valve out of the VR market, he wrote, adding that Sony was focused on the PlayStation 5, HTC was unhappy with its potential hardware partners, and Facebook was investing more. than Valve, the maker of Steam.
“Google and Apple do not really exist in VR in any real way yet,” the document states. “Daydream is a joke,” Rubin wrote, referring to a VR platform that Google ended up stopping a year later.
He was also not keen on collaborating at the time. There was no point in working closely with other potential rivals, because Facebook should be where all users go for their virtual experiences, the document states.
“Let’s not build Metaverset with the plan to help other platforms accumulate and retain consumers,” Rubin wrote. “Let’s build Metaverse to prevent them from being in the VR industry at all in a meaningful way.”
Rubin stressed Friday that the company has moved away from that approach and that the plan is for the meta-verse to be interoperable and open, not “limiting for one company.”
Priya gets married
In one section, Rubin outlines a scenario with a fictional user named Priya visiting the meta-verse. Priya enters a virtual city equipped with a bowling alley, shops, theaters and a Facebook pavilion, described as “the largest building, almost ecclesiastical in its dominance of the square.”
Priya can interact with others and use the metaverse currency to pay for her avatar’s new hairstyle. Priya eventually meets another user who looks like a green and warty troll. They end up getting married.
“The only thing she spends as much time on as she spends in Metaverse is working, eating, socializing and sleeping in IRL ‘MEATverse,'” Rubin wrote. “Her entertainment time is being used more and more virtually. This is helped by Netflix, Facebook, Instagram and other Metaverse integrations.”
A decade into this hypothetical scenario, Rubin says the company’s metaverse will reach 100 million hardware units sold, with 50% Oculus-branded or licensed and the rest coming from other hardware manufacturers.
Facebook CEO Mark Zuckerberg is seen fencing in “Metaverset” with an Olympic gold medalist during a livestreamed virtual and augmented reality conference to announce the branding of Facebook as Meta, in this screenshot taken from a video released on October 28, 2021.
Facebook | via Reuters
Within two decades, time spent in the meta-verse could measure up to “TV in the 90s and Facebook in recent years.” And most importantly for Facebook, “net revenue after developer payouts is billions a year,” he wrote. It would come from the sale of virtual real estate, hats, weapons and status symbols.
Revenue would also come from ads the market Facebook knows best. Rubin imagines Coca-Cola paying for the best location of a pavilion, Ford paying for their virtual cars to be used, or Procter & Gamble promoting its brands on digital billboards. Gucci could open a virtual store, and Comcast (owner of CNBC parent company NBCUniversal) would pay for “a giant sign that says ‘Comcast: Get Better MetaSpeed!'”
“If Metaverse is where people spend time, then that’s where the real economy will be,” Rubin wrote. “It’s our goal to bring Metaverse to this stage. All cards do not appear to be a Facebook product.”
Given the deep level of immersion, Rubin estimated that 100 million metaverse users could lead to more revenue than a real universe with a billion users.
“I might check Facebook several times a day, but I want to LIVE in Metaverset, work in Metaverset and potentially prefer my time in Metaverset to my everyday life,” the document says.
To be successful, Rubin writes, the metaverse must be scary. That is, it must be so ambitious, so brave, so filled with thousands of hours of gameplay, so life-changing that Facebook engineers are afraid of what they are up against.
“If delivery of the Metaverse we set out to build does not scare the hell out of us, then it’s not Metaverse we need to build, it’s not what customers want, and it’s therefore pointless,” he wrote. “Everything else is a miniverse.”
Building all that and reaching the necessary universe of customers, Rubin wrote, would require more than just internal resources. He suggested that Facebook would need a game studio with a team of more than 100 people that could create a massive multiplayer online game.
“One thing is clear: There is no team inside Facebook with the cohesion and experience of posting great, technically challenging, awe-inspiring games / interactive products that are capable of producing the city,” Rubin wrote, referring to the digital world. , the company intended to build. “For these reasons, we will have to make an acquisition.”
He named as potential targets Insomniac Games and Gearbox Software. Other studios like Blizzard and Rockstar were too big and too profitable for an acquisition and too committed to their own universe.
Rubin ended up recommending Ready at Dawn, the studio behind “Lone Echo”. Facebook entered into the agreement in June 2020.
Sets the stage
In addition to the technological results of the metaverse, the launch of the product would be critical and should “create shock and awe,” Rubin wrote.
Zuckerberg should avoid going up on stage for a conference with a slide behind it that says “Welcome to the Metaverse,” if the company is not ready to face the moment.
Mark Zuckerberg, CEO of Facebook Inc., speaks during the virtual Facebook Connect event where the company announced its rebranding as Meta, in New York, USA, on Thursday, October 28, 2021.
Michael Nagle | Bloomberg | Getty pictures
“If we telegraph every step of our roadmap because we have keynote minutes to fill out, competition will always be one step behind,” Rubin wrote. “Let’s not do that. Let’s wait until we have a Metaverse worthy of the name – a Fait Accompli.”
Zuckerberg did not quite listen to that call. His presentation on Thursday was bold, but the world he portrayed is far from ready for consumer navigation.
The demo was a Pixar-like animation that showed software that the company hopes to build. It was filled with users hanging out and training like avatars or cartoon-like versions of themselves. Zuckerberg acknowledged that the technology is far away, potentially as far as a decade into the future.
Some felt that Facebook needed to change the conversation and distract the public after six damaging weeks of stories based on leaked documents from a whistleblower.
Rubin had another explanation. He said the company now knows that in order to achieve its Herculean mission, it must take others on the trip and kiss goodbye to the walled sea access.
“This is a long journey that we have to go on with a lot of different companies,” Rubin said in the interview. “And you just can’t keep it under wraps for that long.”
– CNBC’s Samantha Subin contributed to this report.
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