Hardware is the gateway to the metaverse
Hardware development is critical to the Metaverse. As the user’s gateway to the Metaverse, hardware devices greatly affect the user experience of the Metaverse. Taking the metaverse platform as an example, the current battery life of VR headsets limits the time users can stay on platforms such as VRChat. Also, Web3 metaverse platforms, such as Decentraland, require devices with certain computing power to run smoothly. Not to mention the importance of IC chips to the Metaverse – without the right GPUs and CPUs, it would be impossible to run 3D technology in AR/VR setups.
No matter how advanced the software application is, if the hardware technology is not in place, the user will not be able to experience the full potential of the Metaverse. Therefore, improving hardware technology is a critical issue for many companies today.
Bottleneck: Capital-intensive investments
Many people believe that hardware technology is the bottleneck in the development of the metaverse. Raja Koduri, senior vice president of Intel (Intel), believes that the current computing, storage and network infrastructure is simply not enough to realize the metaverse vision.
Unlike software technology, innovation in hardware technology requires a lot of capital and human resources and usually takes years to achieve.
Building hardware products is complex and time-consuming. Businesses must employ multiple engineers to design a product or part and take care of the manufacturing process. In addition, companies must manage supply chains, dealing with technology suppliers and factories to prototype products. Once the prototype is complete, it enters the testing phase, which must ensure that the product quality meets the requirements of the target market. After all the details are finalized, the business can go into mass production. Each of the above steps requires capital.
The newer the hardware technology, the higher the development cost. Businesses must pay high non-recurring engineering (NRE) fees to research, design, develop and test new products. And, if some parts are not commonly used in the market, companies will likely have to pay more to their suppliers. That might be why? In October 2021, Meta announced that it would invest $10 billion in Reality Labs, the metaverse division of its AR/VR technology development.
Considering the time and resources involved, coupled with the unpredictable demands of the consumer market, and the likely actions of competitors, hardware innovation is indeed a big bet.
Metaverse brings new impetus to technology supply chain
Although there is still much room for improvement in current hardware technology, many important players in the hardware field have shown interest in developing technologies related to the metaverse, which also brings business opportunities.
For ODMs/OEMs, Metaverse will bring new growth drivers and a more diverse product mix. According to Hon Hai Chairman Liu Yangwei, Hon Hai hopes to play an important role in the development of the Metaverse by developing ecosystem-related devices. Liu Yangwei believes that the Metaverse is a technological trend that will occur naturally, and it is also a major event for Hon Hai’s future development. Quanta Chairman Lin Baili is also optimistic about the Metaverse, and believes that the platform built by Meta and Microsoft (Microsoft) will become the industry leader.
Leading suppliers are also motivated to support the development of the Metaverse. Once the metaverse becomes a reality, the demand for high-performance products such as monitors, camera lenses, GPUs, etc. will increase dramatically. Qualcomm launched a $100 million Metaverse Fund to invest in Extended Reality (XR) technology. Samsung Electronics introduces the 837X at Decetraland. NVIDIA also strongly supports Metaverse development, launching NVIDIA Omniverse Enterprise, an extensible platform for 3D design collaboration with multi-GPU, real-time, and immersive features.
Once the Metaverse comes true, both the overall demand and the number of consumers in the hardware market will increase, and suppliers will have higher bargaining power to guarantee their profits. As the technology of smartphones, PCs and smart watches matures, suppliers are also looking for new opportunities to generate more profits.
Also, as the Metaverse becomes a hot topic in the capital market, related technology companies can get better valuations from investors and the stock market. Therefore, ODMs/OEMs and technology suppliers are more willing to support and invest in XR technology to accelerate the development of the Metaverse than a few years ago.
Maybe, that’s why Mark Zuckerberg renamed Facebook to Meta in 2021. The success of the name change stimulated more capital to flow into the metaverse. As a result, technology partners such as ODMs/OEMs and component suppliers are more willing to work with Metaverse, even if orders are not currently as high as Apple’s devices.
Hardware assists the metaverse
With the continuous advancement of hardware technology, the experience of the metaverse will also improve, and good hardware devices can accelerate the penetration rate of the metaverse. Looking back at the history of the web, smartphones have greatly increased usage and the time people spend online. Likewise, with good hardware technology, users will be more willing to experiment and spend time in the metaverse world.
Improvements in hardware specifications can also drive the quantity and quality of Metaverse content creation. The more content the metaverse has, the more likely people are to spend time on it. The popularity of smartphones with high-definition cameras was also around a time when online platforms such as YouTube and Instagram took off.
This trend is happening. In the past, most Metaverse creators worked on PCs or mobile devices. With the advancement of VR installations, people have been able to build worlds and objects on platforms such as Rec Room and Horizon Worlds. People who do not know how to write programs can also participate in content creation. In the future, with the advancement of hardware devices, there will be more ways for people to produce more content for the Metaverse.
The future is coming
There is no definite timetable for when hardware technology will break through and allow people to see the full potential of the metaverse. However, with all the capital and interests involved, the future may come sooner than we think.
[編按] The original article was published in English here:Hardware: the bottleneck and accelerant of the Metaverse
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