Multiverse virtual worlds will be healthier for society than our current social networks

Virtual Worlds EC-1 Part 5: Why this new future will heal social fractures

The basis of the classic James Bond film “Tomorrow Never Dies” is an evil media mogul who instigates war between the U.K. and China because it will be great for TV ratings. There’s been a wake-up call recently that our most popular social networks have been indirectly designed to divide populations into enemy camps and reward sensational content, but without the personal responsibility of Bond’s nemesis because they’re algorithmically driven.

(This is part five of a seven-part series about virtual worlds.)

The rise of “multiverse” virtual words as the next social frontier offers hope to one of the biggest crises facing democratic societies right now. Because the dominant social media platforms (in Western countries at least) monetize through advertising, these platforms reward sensational content that results in the most clicks and shares. Oversimplified, exaggerated claims intended to shock users scrolling past are best practices for individuals, media brands and marketing departments alike, and social platforms intentionally steer users toward more extreme content in order to captivate them for longer.

Our impending cultural shift to socializing equally as often through virtual worlds could help rescue us from this constant conflict of interest between what we recognize as healthy interactions with others and how these social apps incentivize us to behave.

Virtual worlds can have advertisements within them, but the dominant monetization strategies in MMOs are upfront purchase of games and in-game transactions. Any virtual world that gains enough adoption to compete as a social hub for mainstream society will need to be free-to-play and will earn more money through in-world transactions than from ads.

The companies behind the leading virtual worlds in gaming, like Fortnite creator Epic Games and Counter-Strike parent Valve, earn their billions in revenue primarily through transactions for virtual goods like virtual coins and digital clothing referred to as “skins,” and for premium features like temporary health boosts for your avatar or “unlocks” of restricted areas of the world map.

Whereas social media apps simplify human interaction, virtual worlds thrive on embracing its complexity. Virtual worlds are all about participation in building things and pursuing adventures — and that necessitates commerce.

In-world transactions are such a lucrative monetization strategy for two main reasons:

  • Emotional investment: Users are only being prompted to pay for something once they have gotten emotionally invested enough in the stakes of their contribution or their avatar’s reputation within the world. Once someone cares about their presence in the virtual world, it’s rational to want to buy things to improve their experience.
  • Price discrimination: Because the world is filled with small transactions for goods, services and features, items for users with less spending power can be priced lower and bought less frequently, whereas other items can target those with high spending power who want luxury goods and time-saving functionality. In mobile gaming, a large portion of overall revenue for many games comes from a small number of users, known as “whales,” who are extremely wealthy and will casually spend $10,000 in a day or a month for virtual goods and features that let them advance in the game faster and signify their social status. The physical world has all manner of goods and services for different markets of spenders; virtual worlds are the same but they don’t have raw materials costs that make certain goods inherently costlier to produce.

To maximize their revenue, the companies behind virtual worlds want you to feel ever more emotionally invested in your participation in the world so that you buy more items (and more expensive items) to enhance your capabilities and raise your social status in-world.

Games are far from perfect, of course, as they employ psychological tactics to keep players addicted. But people will ultimately leave toxic environments, and so businesses are incentivized to craft worlds where people want to stay perpetually because they feel they belong.

Tactics to encourage people to spend more money on goods and services are part of our day-to-day lives in the physical world, as they have been since the origins of human commerce. Individually, we’re used to the battle to stay disciplined in our spending habits, and societally this is a much less concerning business model than one centered on sensational content.

Brands will be incorporated into virtual worlds through substantive participation. Social media ads, like most ads in publishing and video, are a bait-and-switch game of attracting consumer attention to a piece of content then interrupting that focus briefly with ads unrelated to that specific content experience. Advertising in virtual worlds is about experiential marketing: giving away virtual goods with company branding, organizing cool events that users attend or opening an in-world retail location.

These types of campaigns are already happening: Epic Games took brand collaborations with Marvel (for Avengers: Endgame) and Nike (for Jordans) into Fortnite, LVMH partnered with Riot Games to add Louis Vuitton skins into League of Legends, and Minecraft took the step of banning users from creating branded goods and spaces in 2016 after companies like Verizon and Disney paid users to build them.

As I outline later in this series, virtual worlds will come to function like new countries that exist in a parallel cyberspace rather than with physical territory on Earth. This poses a fascinating set of challenges and also an exciting opportunity for humanity.

Virtual worlds evolve dramatically faster than the physical world — politics, economic changes, development of new goods and lands — and the only harm that can occur to a user is financial or reputational. Virtual worlds will be test labs for designing any imaginable type of society and figuring out the economic and political dynamics that result. They will inspire bolder ideas about how society in the physical world can change and counter the growing pessimism about humanity’s future.

Participating in virtual worlds with varying degrees and models of self-organization among users also results in users confronting basic debates of political philosophy and experiencing the problems and benefits of different governance models firsthand. Moreover, the income-earning opportunities within virtual worlds will offer employment to those displaced in the physical world by new technologies.

In short, while there may be new, unanticipated challenges that arise from these virtual worlds, I expect that they will heal many of the fractures that have been caused by social networks over the past decade.


Virtual Worlds EC-1 (Special Series) Table of Contents

Also check out other EC-1s on Extra Crunch.