Chief Content Officer,
Techstrong Group


In the Digital CxO Leadership Insights series video, Mike Vizard speaks with David A. Smith, founder and CTO for Croquet, about the metaverse and how it can be applied to business applications.



Mike Vizard: Hello, and welcome to the latest edition of the Digital CxO Leadership Insights video series. I’m your host, Mike Vizard. Today, we’re with David A. Smith, CTO for Croquet, and we’re talking about the metaverse in business. David, welcome to the show.

David A. Smith: Thank you so much. It’s great to be here.

Mike Vizard: People think about the metaverse mainly as a consumer application, gaming where people go to play. Are we not thinking through enough about how the metaverse might be applied for business applications? And what are some of those use cases?

David A. Smith: Actually, I think there’s a very deep misunderstanding of what the metaverse really is. And to give you some context, what we think of as the metaverse is primarily a communication platform. So, we think about this idea of you and I are going to be engaging in the future, we may be wearing glasses, maybe we’ll still be using our phones, but we’re going to be able to communicate, and as we communicate, imagine an AI listening to that, and it generates a shared simulation that both of us can engage in. That could be everything from obviously a game perhaps, but we find it a lot more interesting to see what could happen on the enterprise industry side where we actually start thinking about this as – using these technologies to understand problems and then actually solve them collaboratively.

So, that’s, I think, a far more important concept of what the metaverse is and it’s going to have a much bigger impact on how we engage with each other, how we engage with our organizations, with our partners. But mostly, we see it as it’s going to be the place where we spend most of our intellectual time. We think about it as the knowledge worker. This is going to amplify the idea of what it means to be a knowledge worker because we’ll be able to ask for information, ideas, and like I said, generate dynamic simulations as part of that conversation. So, it’s going to be hugely impactful, much more than we think about the phone’s impact on the world. It certainly had an impact on the consumer side, but certainly had an impact on the industrial side too. The fact that you’re carrying the internet around in your pocket today is fantastic, but it’s going to get far more part of our everyday existence because we’ll be in a sense wearing it.

Mike Vizard: As part of that, we’ve had the concept of digital twins for a while and we’ve had the concept of collaborating around those digital twins, but it’s an expensive proposition to set that up. So, if we have the metaverse as a core platform, do you think the cost of creating these kinds of virtual worlds and then collaborating around them to solve a problem will be sharply reduced? And is that part of the attraction?

David A. Smith: I think so. I mean, I certainly think that the concept of a digital twin is a centerpiece of what the metaverse is going to provide. The way we think of a digital twin is you have an information source that can be anything from purely digital information like stocks and things like that, but it can also be the state of your factory line or the state of a refinery, any kind of information that you need to be able to monitor, understand, particularly when things go haywire. So, digital twins are basically live representations of information of various sorts coming into a shared system. For us, the way we think about it is you and I are going to be looking at exactly the same situation on the factory floor. You and I are going to figure out what’s the steps to be able to address that, and that might be everything from “I’ve got a big problem” or just optimizations associated with that.

But digital twins are a centerpiece of what the metaverse is going to provide. And again, it’s this idea of you and I engaging in an information space and we’re using the metaverse in a way to understand that information space. And it’s, like I said, a live information space. It’s going to be extraordinarily powerful and essential. I mean, I don’t think the cost of these things, as you raised before, have been significant before because we didn’t really even know how to do collaborative systems. I mean, we’re – Croquet has been working on this for quite a while, and being able to provide that live update where it’s guaranteed that what I see is what you see and it’s guaranteed that when I act on this you see me act on it as I do that, that’s kind of a new thing.

And the other side of it, of course, is accessing that 3-D information. We’ve got in a sense two kinds of 3-D information. One is totally virtual, like I was talking about stock data. You can imagine a landscape of all the stock portfolio you have and you’re deciding how to maximize that. And then, the other side of that is, like I was talking about, the factory floor, where that’s a real place and we have both a virtual twin of that where we actually see a 3-D model but we can also incorporate live video, or even further, looking at live point cloud information. So, we actually have a live 3-D representation of that space and you’re going to see people walking through there who are actually on the factory floor right at that moment.

So, you’re really going to see this very interesting merger of the real reality and the virtual reality into what I just call reality. That’s the future of all of this stuff.

Mike Vizard: So, to that point, will we be able to distinguish between the metaverse and reality? Or will it just become a natural extension of everything we do?

David A. Smith: I think you’ll be able to distinguish typically. At some point, you may lose that sense of what’s real and what’s not. But the reality, as you just said, is it won’t matter. It’s just going to be the way the world is. I’ll be able to – I mean, think about every screen that you see in the world today. Once the displays – head mount displays will be good enough – and they will be, it may be ten years, it may be five, but they’re going to be good enough that every single display in your life is going to go away. You don’t need – I mean, when you can have something like this that is the size if an IMAX theater, what do you need a PC screen for anymore? You don’t need your phone anymore. All of that information, all that display information goes into this. And now it’s just like you just think about it and that information space is going to show up and you’re going to be able to engage with it. So, that’s definitely what’s coming and it’s going to permeate your life.

Mike Vizard: Do you think that everybody is going to want to wear glasses then? Or, what is the interface going to look like in the future?

David A. Smith: Well, you and I already do. So, if you think about augmenting vision, it’s like some of us have no choice already. And I do think, though, that raises a really good point. If they look like this and they feel like this and about this weight, sure, absolutely. I mean, if you’re not wearing glasses in the future that have this capability, it’s like not having a smartphone. And the people who don’t have smartphones are people like my mother-in-law. That’s not a – that’s not where the action is, the reality is. Every person who has to have access to other people has a smartphone today and the same thing is going to be true of these wearable devices in the future.

Mike Vizard: Everybody who doesn’t have a smartphone is constantly asking somebody else to look something up on their smartphone for them anyway.

David A. Smith: Yes. Exactly.

Mike Vizard: Will there be multiple metaverse platforms? And then, will we have some interoperability issues to work out? And is that something we’ve got to think about long term?

David A. Smith: Yeah, I think – I have a very particular perspective on this. My opinion is that the Web itself is the metaverse and is going to become the dominant metaverse. And I’ll give you a good example. The reality is think about how much time you spend on your computer. How much time do you spend on the Web versus on local applications? It’s probably pretty close to 90 percent on the Web, is my guess, unless you’re doing a lot of writing. But even, like, Microsoft Word is really a Web system underneath it – underneath the hood, and in fact you can get Microsoft Word or Google Docs online. So, what we’re really already seeing is a lot of the core capabilities of the metaverse are locked up in the browser. And that that means is the browser has just expanded extraordinarily in its capabilities as power, as performance, and in just the ways that are required for what we think of as the metaverse.

First of all, remember, it’s friction-free. I can go to any Web page just by typing a URL. You can send me a link and you and I can engage instantly. The performance of the Web, particularly in 3-D, has just gone up incredibly. We obviously have WebGL; under that it’s using the same GPU as a AAA game uses. It’s the same infrastructure. But even with that, we see next-generation rendering capabilities with WebGPU with the browser that are going to increase in some cases 10x over what we have today. JavaScript is extraordinarily fast and getting faster. Web Assembly, which is basically using native type languages, has demonstrated an ability to generate nearly native performance on any device. And finally, it runs on everything that has a screen. It’s like I have a browser on my phone, I have a browser on my tablets, I have a browser on my PC of course.

And so, when we see this idea of interoperability and it’s like – the understanding is like we already have a lot of that infrastructure in place and it’s not going away. If anything, I think that the Web itself is going to absorb the metaverse very, very quickly, and the idea of having these kind of islands of native applications is going to be – go away quite quickly because it’s – it doesn’t scale, and as you pointed out, it doesn’t interoperate with anything else. So, really, I think we already have the beginnings and a very important beginning to what the metaverse is going to be, and it’s in your browser.

Mike Vizard: Well, let me ask you, then, is that an extension of what we currently call Web 2.0?

David A. Smith: You mean, Web 3.0?

Mike Vizard: Some part of a Web 3.0 kind of thing? Or is it a Web 4.0 kind of thing?

David A. Smith: Well, yeah. That’s a good question. It’s certainly Web 2.0 in a sense, but I think when we add collaboration it’s a very new thing. And like I said, I think of the metaverse as a communication channel, a communication platform first and foremost, and we’re beginning to see the rise of collaborative applications over the last few years. Obviously, that was fueled to a large degree by COVID, but the reality this whole – the whole metaverse, the whole idea of the metaverse is ultimately going to be a collaborative engagement platform. So, when we think about what is it, it’s certainly beyond Web 2.0. Web 3.0 is going to play important roles within this. You look at things like interplanetary file system; IPFS is one component of Web 3.0. And then, smart contracts, I think, are going to be also pretty essential, this idea of you and I engaging with each other; having something that makes a record of any kinds of transactions that we do together is going to be essential. And that also has to be friction-free, just like the Web is. And so, we sort of see the role of Web 3.0 as a part of the metaverse. It’s not the metaverse, though. So, maybe we’re talking about Web 3.5 or something.

Mike Vizard: Do you think – will we need to travel for business, or for that matter to visit relatives? I mean, what will be the impact on travel if we can instantly interact with each other anytime anywhere?

David A. Smith: You know what? I sort of think of it as the difference between listening to what we used to call CDs and going to a concert. I think the concerts are still crucial, this idea of having a live engagement with somebody face to face, like your parents or your family or your colleagues, because there’s a – the concept of bandwidth is really key to this. How much information are you and I able to exchange via Zoom, for example, like right now? It’s pretty minimal. I mean, I see you, I talk to you, and we have a – you get a little bit of my body English, but the reality is it’s a very, very narrow channel of information. I do think the metaverse is going to expand that greatly, but it’s in other dimensions in the person. In other words, we’re talking about information expansion, idea expansion, but that face-to-face engagement, I don’t think it’s going to be doing a particularly great job of that, at least not for quite some time.

But on the other side is even when we’re face to face I think the metaverse is going to be part of our discussions. We’re wearing glasses, I’m standing in front of you and I say something, the computer generates the simulation between us, and both of us can reach in there. I see you do that with your real hands and it’s responsive instantly as if it were a physical thing. That’s going to happen for sure.

But yeah, I still think it’s going to be important to have face-to-face engagement with people for – certainly for a long, long time. It’s hard to predict how the world would transform, but I do think that the value of in-place, in-person engagement is probably never really going to go away.

Mike Vizard: Do you think as we go along that this is going to play out in phases? And what kind of phases might they look like? I mean, we’re in a phase at the moment, it’s early stages, but is this going to evolve slowly? Quickly? What’s your thought?

David A. Smith: It’s an exponential curve, really. I mean, and so was, by the way, the iPhone. When it first showed up it didn’t have a lot of sales but it rapidly increased. We’re, I think, in the same boat. We’re beginning to see, first of all, a huge amount of investment in this platform and these technologies. I think Meta did $10 billion of investment last year. Who knows what Apple is spending on it but we know it’s a lot. What we’re going to see and we’re already seeing is the first iteration of these devices is pretty good. They’re not great yet but they’re demonstrating that, hey, we’re beginning to get a handle of what’s possible. But I do believe that we’re going to have an interesting inflection point like any other exponential curve, and it’s probably going to happen in about three to four year where we’re going to have devices that are very compelling, very, very high quality, and it goes from one of those things very quickly, from “Oh, it would be really nice to have one” to it becomes essential.

And that was what happened with the smartphone, if you recall. I mean, a lot of people waited quite a while because they had the flip phone and they didn’t need anything else, and then all of a sudden a lot of things converged. First of all, the usability, the value experience of the smartphones got good enough that it had to be considered. The other thing is the cost dropped to a point where it made no sense not to start using that. In fact, today you can’t even really find flip phones. They’re gone.

So, yeah, I do think it’s going to – I think we’re on an exponential curve already. It’s just that flat part of it, and then it’s going to start transitioning, certainly within our time horizon – say, five years, you’re going to definitely know you’re on that curve.

Mike Vizard: All right. Well, I guess one day soon this interview is going to take place in the metaverse. But until then, David, thanks for being on the show.

David A. Smith: Oh, a real pleasure. I appreciate the time.

Mike Vizard: And thank you all for watching the latest episode. You can find this one and others on the Digital CxO website. We invite you to check them all out. And once again, thanks for spending some time.

Modernizing Digital Banking Services

Step 1 of 7

What are the primary business drivers for your organization to modernize its digital banking services? (Select up to three)(Required)