18.05.2023

On its last legs

Mark Zuckerberg bet the farm on virtual worlds - and lost. Paul Demarty pours one out for the metaverse

“When the tide goes out,” said famous fund manager Warren Buffett, “you see who’s been swimming naked.” He was talking about the ‘dotcom bust’, and how the corresponding shocks exposed the immodestly leveraged likes of Enron and Worldcom.

Since then, we have watched a tightening of the US mortgage market in 2006-07 leading to the collapse of several investment banks, thanks to the near-fraudulent securitisation of junk debt over many years; along with the CDOs (collateralised debt obligation) and so on, more than one outright Ponzi scheme was brought to light - most notoriously that of Bernie Madoff.

Well, the tide has gone out once again on the great and the good of the technology industry; and it seems rather like everyone has been swimming naked - almost as if the San Francisco Bay Area had wholly transformed itself into a nudist colony. Since Joe Biden’s federal reserve imposed an end to the cheap money era, a merciless spotlight has fallen on the big dreams, bigger promises and bigger-yet disappointments of the tech scene. Uber can no longer dismiss its financial insanity with a langorous shrug in the direction of autonomous vehicles. Twitter’s long-term investors at least managed to find a greater fool - the greatest fool of them all - to sell up to. Google flounders from one big idea to the next.

Meta mess

And then there is Meta: a rebrand of the Facebook group, it owns, along with its formerly eponymous social network, Instagram, the Oculus virtual reality brand and various advertising (or ‘adtech’) services. In the two years since the Meta rebrand, however, the company’s main focus has been on one thing: the ‘metaverse’ - an attempt to stake out a monopoly in the anticipated future of pervasive virtual reality. Indeed, this was already a discreet priority years before the official public launch; the acquisition of Oculus - until then wholly focused on gaming and led by games industry legend John Carmack - only makes sense if Facebook/Meta were going to try something like this (or else just get into games in a big way).

The metaverse then allows you to put on your virtual reality headset, and emerge into a new world, where you are a smiling cartoonish avatar of yourself. The ‘default’ VR world is managed by Facebook, and is squeaky-clean to an almost Disney level. But you can visit other worlds too, which are - as per the background norms of the internet - flooded with pornography. The virtual worlds have places to visit - bars, comedy clubs, whatever else - but, of course, it is a strange, threadbare imitation of life: bars without beer, comedy without swearing … Notoriously, the avatars do not have legs.

Zuckerberg has found all this rather difficult to sell to the general public. And now it appears he may be discreetly conceding defeat. Like every other major tech company, Meta has been through rounds of brutal layoffs. In March, he quietly announced to investors that the “number one priority” for the company would be building generative artificial intelligence “into everything we do” - necessarily implying that the metaverse was taking a backseat. If it was no longer a top priority chez Zuck, then the various other companies that rushed to start up metaverse projects could hardly be expected to pick up the slack (indeed, some blue-check partners, including Microsoft and Disney, had already shelved their metaverse investments). The thing is widely believed to be effectively dead.

Outside of that most credulous of all crowds - Silicon Valley investors - it was always a laughing stock. Meta’s own metaverse world never got more than 200,000 monthly active users (Facebook itself has around two billion). The businesses most happy to invest in the platform were largely cryptocurrency-focused, since they were already familiar with the art of selling nothingness in exchange for money; but the very first people to be discovered ‘swimming naked’ when the fed tightened the screws were the crypto bros.

Buzzwords

And - for heaven’s sake - where are the legs? It is a more serious matter than it first appears (I promise). Listening to the official responses to leg-focused ridicule, you would think that nobody had ever successfully animated the lower half of a human body in the history of video games (for that, in the end, is what the metaverse is - an ecosystem of games). This is quite absurd. People had legs in Second Life - a game-cum-social network that got a cult following 20 years ago and is the most obvious prior art. Millions upon millions of people play Fortnite, World of Warcraft, Call of Duty and many more ‘traditional’ multiplayer games with each other every day. All have somehow managed to cope with the challenge of bipedal character models. One can cope with the failure of the real thing to live up to the promise of lifelike facial expressions and so forth from the official launch; but there is simply no reason for this thing - which, after all, has had $100 billion of Meta investors’ money ploughed into it - to look so cheap and half-finished, three years since the launch.

One thinks of Maxim Gorky’s damning verdict on the Lumiere films:

Last night I was in the Kingdom of Shadows. If you only knew how strange it is to be there. It is a world without sound, without colour. Every thing there - the earth, the trees, the people, the water and the air - is dipped in monotonous grey. Grey rays of the sun across the grey sky, grey eyes in grey faces, and the leaves of the trees are ashen grey. It is not life, but its shadow. It is not motion, but its soundless spectre.¹

Cinema ultimately escaped his critique, of course - from hand-colourisation of frames in the 1910s to sound and colour stock in the 1920s and 30s, and other technical innovations that improved verisimilitude since the war. Along the way, it acquired a distinct sense of purpose: the technical demonstrations of the Lumiere and Edison films gave rise to the cinema as a kind of sideshow attraction, shown between vaudeville acts - and then to the narrative feature film, with its dedicated infrastructure of studios and movie theatres.

The rosiest view one could put on the metaverse is that it is still in the first, ‘tech demo’ phase. Yet its first phase was so ill-conceived that it is genuinely difficult to see any path to universal adoption. At least the first films were cool attractions (Gorky’s misgivings notwithstanding). Facebook hitched its wagon to a niche technology - the VR headset - still going through its technical teething problems (in particular the notorious issue of severe motion sickness).

It conceived of the metaverse in line with 2021-era buzzwords about ‘decentralisation’ that flew under the catch-all banner of ‘web3’, along with cryptocurrency-derived novelties like the notorious non-fungible tokens (NFTs). Wider economic circumstances euthanised all this crap, fortunately, but not before the web3 sector demonstrated that its ‘decentralisation’ was a total fiction: it could only bring money into the Ponzi scheme because there were centralised marketplaces, storage and authentication services, and so on. It may be that a real use is found for technologies like blockchain, eventually; but the central claim that it would get rid of the need for trusted intermediaries in various human activities is proven laughably false - by the web3 debacle and also by the severe pressure on the crypto-trading space, resulting from the collapse of a few exchanges. Crypto merely replaced trusted intermediaries with less trustworthy ones.

Likewise, only one of the largest tech companies in the world could even make a working possibility out of the metaverse. Yet it could only be worth trying for the one and only reason tech giants ever try anything: to manufacture a monopoly from which to extract rent. The fact that Zuckerberg’s vision of the next great enclosure turned out to be a dud is besides the point: the whole initiative was another nail in the coffin of the ‘new frontier’ idea of the internet - the idea that net users could be something like a class of yeoman farmers on their inviolable patch of cyberspace.

Grifters

The idea will persist, among grifters and true believers; just as one can find ‘frontiersmen’ preparing for social breakdown in the hills of Montana, or the occasional cult compound. For the left, we must prepare a rational plan for an internet that takes advantage of economies of scale, but not in the haphazard and anarchic way that the present arrangement of tech giants do - and certainly not guided by the perverse and tyrannical incentives that the mere fact of monopoly imposes on them.

It is the need for limitless growth that produces an idea as stupid as the metaverse, at least in part; but it was the same thing that produced the relentlessly manipulative, psychologically and spiritually enervating hellscapes of the successful social media platforms, from Facebook itself to the suddenly popular video-based Skinner box that is TikTok. Democratic planning would trivially allow abundance at the level of hardware and infrastructure, equivalent to the very best offerings from the giant cloud companies; with that in place, a great flowering of software and digital culture should be expected - not to improve some meaningless and largely fictional revenue number, but to meet a genuine human need, or indeed just for the sheer hell of it.

Before we depart from this topic, we might spare a thought for (what should be) another casualty of the metaverse mess - the fiction that Zuckerberg and his like are visionary geniuses. The squalid origins of Facebook are well-documented, as is the tale - possibly apocryphal - of Peter Thiel’s decision to invest. The Facebookers’ pitch deck was full of guff about wanting to connect people to make the world a better place; but Thiel - already a viciously reactionary cynic - remembered his classes with René Girard, and guessed that the app would resolve to a bloodthirsty atavism recognisable to readers of Violence and the sacred. Whatever the merits of Thiel’s reasoning, he guessed right - the more angry and anxious users of all the major social platforms are, the more ‘engaged’ they become (and the more vulnerable to advertising). The point here is merely that Zuck did not even understand his one success.

An interesting article in the New York Magazine blog by John Herrman argues that the problem with the metaverse is that ultimately it only appealed to tech company executives, which would account for how such an obviously floundering product could get such impressive blue-chip buy-in. The point was not the silly ‘social’ features, but the possibility of employee surveillance after the shift to home-working during the pandemic: “Empty offices and newly empowered employees drove some tech executives out of their minds,” he writes, “and the metaverse promised a solution, or at least functioned as a response”.² But ultimately senior managers of this cast of mind came up with a better idea: just forcing people back into offices (among these executives, of course, was Mark Zuckerberg).

I think there is a more general point here, however. There is a specific kind of groupthink among tech industry powerbrokers, which amounts to an inability to abandon the apologetic structure that justifies their privileges. The industry has to be astonishingly inventive: otherwise why not work in a bank? Why not just start a hedge fund? Thus such people are easily embarrassed by the course of events: witness the increasingly bizarre flailing about of Elon Musk at Twitter, and his coterie of enablers like David Sacks and Jason Calacanis - but also, for that matter, the adulation directed at the fraudster, Elizabeth Holmes, before her blood-testing company, Theranos, was revealed to be a Potemkin village; or the glowing profiles of the narcissistic moron, Adam Neumann of WeWork, which aimed to “elevate the world’s consciousness” by, er, subletting commercial office space.

The CEOs and investors are not, in theory, stupid. They have degrees; they are literate. Their unlimited gullibility is an ideological artefact. They cannot face the facts: that the entrepreneurial genius is an illusion; that almost all of their ‘innovations’ are stolen, consciously or otherwise; that their industry is entirely parasitic on the state, be it through research subsidy or mere favourable monetary policy. That is the magic of capitalism: even the protagonists are non-player characters.

Without legs.