This is third and final installation of a 3-part blog series on a Cisco Futurist’s perspectives on some buzzy terms and technology trends.
At Cisco, I’m responsible for looking at the future of human-machine interaction, where there is a ton of buzzy terms and trends being bandied about. In the first and second installations of this blog series, I defined some key concepts and shared my first three unpopular opinions about Web3, the Metaverse, and decentralization.
TL;DR on my first three opinions:
- The Metaverse will be more powerful as an augmented experience rather than a virtual one.
- There are two types of Metaverses: Open and Closed.
- The entire internet will not be decentralized.
So let’s move right into my last three unpopular opinions…
Most people won’t really care about the ethics of a decentralized Internet.
Web3 is, in part, a movement to democratize the internet, but the desire for decentralization isn’t just about removing centralized control over data, money, and more. Supporters of the Web3 movement have been strongly motivated by a lack of trust.
- Trust in institutions has fractured — especially in the United States.
- Decentralized currency is appealing to international investors who do business in certain volatile, unpredictable economies.
- Many believe Wall Street has gated wealth. As such, non-traditional investors often seek alternative paths to generate wealth.
A fierce, vocal, passionate group of people are the ones leading the decentralization movement. They highly value its autonomy and advocate for decentralization on behalf of the Greater Good.
Today, the number of purists who really care about the ethics of decentralization is relatively small, yet represent a critical component in seeing the future of decentralization. Early adopters are more likely to care about transparency and the value of a democratized Wall Street than the average user. The middle of the bell curve will need persuading that Web3’s incentives — like lower transaction fees vs. a central bank (someday) or getting paid to allow a company to use your personal data — validate engaging in something new and unknown. Even some early adopters are getting hit by thieves who are faster to take advantage of security loopholes in today’s burgeoning Web3.
Overcoming the ambivalence of the many will be critical to Web3’s adoption, and that’s not only related to why Web2 isn’t trustworthy. It’s also critical because for Web3 to succeed, we may have to change the way that we pay to use the Internet, leading to my next unpopular opinion.
Convincing users to pay for Web3’s Creator Economy remains a challenge.
The Creator Economy is the movement of individuals creating internet content and media that is consumed, and it plays a significant role in driving Web3 forward. This Creator Economy is driving engagement, but millions of creators are also seeking to monetize their creativity. Increasingly, we are seeing creators are charging for their experiences, sometimes in novel ways. It’s easier than ever to do that on Web3, where your crypto wallet can easily tap into the sites you visit, and cryptocurrency micropayments should be easy to make.
But consumers aren’t used to paying for engagement. We get tons of the internet for free today, but it comes at a cost: our personal data. This harkens back to Redditor blue beetle’s famous quote in an August 2010 thread:
“If you are not paying for it, you’re not the customer; you’re the product being sold.”
– Andrew Lewis, aka blue beetle on Reddit
With the centralized Web2 economy, the questionable use of personal data has been widely publicized and criticized, evidenced by backlash against Google and Facebook over the past few years. That said, user data collection has long been the currency companies use in exchange for free experiences. Consider social media platforms like TikTok. Or collaboration tools like Google Docs. Or news sites like CNN.com.
User data collection drives the effective ad targeting these companies use to drive their advertising revenue. This is what allows them to forego subscription costs. Thus, to build Web3 business models, decentralized applications (dapps) will likely do one of the following:
- Require users to opt-in to data collection (like we see in Web2), but with transparent user data on the blockchain. This would allow users to verify what is happening with their data. Given that some understand what happens with their data, it will be interesting to see whether consumers are actually interested in having control of their data on the blockchain. This is also given the collaborative nature of the community.
- Reward users who opt-in to data collection with reduced or free site usage, charging higher fees to users who do not share their data.
Reward users who opt-in to data collection with public-or-proprietary cryptocurrency or tokens they can use to pay for experiences or products.
Create a business model that doesn’t rely on customer data, with enough substantial value that their site validates subscription usage fees, or which uses publicly available data from the blockchain.
Selling, gamifying, tokenizing engagement
Selling within this new value model, and gamifying and tokenizing engagement, is a critical step in bringing Web3 from the margins into the center of Internet interactions. Younger demographics have shown to be keener on expecting rewards for engaging with a brand. In fact, 78 percent of Millennials are more likely to select a brand with a loyalty/rewards program.* By the time Web3 truly emerges as a prominent aspect of the web, tokenized engagement might already be a larger portion of the actual economy.
However, Big Tech Web2 will still retain control a portion of user data from those using their services. As long as they they continue to provide exceptional value, users will continue to pay by allowing them to retain their data on centralized servers.
This is why I believe Web2 will continue to have a strong presence in the Metaverse among other consumer applications, even with the rise of Web3. Web2 represents the ability for companies to have more control over information. Information is money. And they will continue to build solutions that validate the value consumers get in exchange for the data they provide.
Now let’s look at how those companies are engaging in Web3, driving my next opinion…
The Internet of the Future isn’t as decentralized as many might hope.
The Metaverse’s democratic (or debatably, anarchic) roots have led many to characterize the Metaverse as “the Wild West.” That terminology has extended to Web3, crypto, and more recently, NFTs, as they lack formal governance. But going back to the ethics of decentralization, that’s kind of the point.
Decentralization offers freedom from central entities controlling the Internet. However, the tide is shifting towards a kind of formal, transparent, democratized governance through the establishment of Decentralized Autonomous Organizations (DAOs).
Decentralized Autonomous Organizations (DAOs)
In DAOs, users partner in groups formally connected through blockchain-based contracts. They pool their crypto and vote on investments. Think of it like small, coordinated groups of people who are voting on rules and actions based on their own personal beliefs and preferences. It represents pockets of unified ethics developing around the type of experiences Web3 believers want to see. This collaborative DAO approach has extended into the Metaverse – and it is as close are we get to governance, both in Web3, and the Metaverse.
Here is what is especially interesting to me, though. Although DAO investments are substantial enough to replace traditional VC investments in some areas, some see DAOs as a necessary evolution of VCs. But within that shift, entities — instead of individuals — will begin to insert themselves into Metaverse investments and experiences. It’s similar to how large shareholders are able to exert more pressure on publicly-traded companies than individual stakeholders. For instance, investors in the PleasrDAO include Andressen-Horowitz, a notable VC.
“There are a lot of people who have money to invest. They need some vision to throw money at.”
– James Grimmelmann, Cornell University Professor, Law and Technology
A DAO is at the mercy of its investors. Only if investors are willing to take risks and if their investment strategies align, can DAOs experiment dynamically and collaboratively, thus building Web3 and, by design, the open Metaverse. DAOs function just like stocks in the sense that investors purchase crypto tokens – like shares. The more crypto token an investor owns, the more power in their vote.
With an increasing presence of companies participating in DAOs, I expect well-resourced companies and VCs to exert more control than individuals in some of these decentralized investor pools. But when that happens, it will be interesting to see how they balance their interests without alienating or damaging the connected communities they are a part of.
“If we stay in the current paradigm, we will move further and further into a realm where a small handful of companies run by a small number of people run our experiences in cyberspace. And in that world, the problems of Big Tech are exacerbated.”
– Sam Williams, Founder of Arweave
Promises of human-machine interactions in the future
Let’s recap all six of my unpopular opinions.
- Metaverse will be more powerful as an augmented experience rather than a virtual one.
- There are Two types of Metaverses: Open and Closed.
- The entire internet will not be fully decentralized.
- The majority of people won’t really care about the ethics of a decentralized Internet.
- There is still work to do in persuading users to pay for the Creator Economy that is constructing Web3.
- The Internet of the Future isn’t as much of a movement away from centralized control as many might hope.
These are my opinions as of now. However, in the next couple of months, I could learn new information that persuades me otherwise. That’s the beauty of learning. Our knowledge and opinions remain malleable so long as new developments evolve to impact them. I delight in being able to keep tabs on trends and watch them evolve, giving us runway to influence decisions. This leads to actionable outcomes, as my team and I are talking about how we adapt our customer experiences for this future, from tokenizing engagements to interacting virtually in the Internet of the Future.
What are some of your unpopular opinions on the Web3, the Metaverse, and the future of Human-Machine Interaction? And what are your thoughts on mine? Leave me a comment below!
*Retail for the Millennials – How Do They Purchase and What Do They Really Want?, V12, June 5, 2022.
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La interacción de Hombre-maquina realmente es el futuro.
Gracias! La cosa es que *parece* que es el futuro – pero en muchas situaciones hoy día, es verdaderamente el presente. Pero – un presente creciendo y cambiando y evolucionando, más rapidamente hoy que antés de la pandemia.
Es grandioso el avance que se tiene con la interacción de hombre – maquina
¡¿Es increíble, no?! Y a mí me encanta leer noticias de los desarollos de sciencia que avanza el tema de interación. Los materiales, las pantallas, realidad mixta, inteligencia artificial…es un super hobby.
Human-machine interaction really is the future
Real issue, depends how companies will handle it, we will get either totalitarian regime, or equal society
I would prefer a real technology company like Cisco to have a more critical/realist spin on unproven term such as DAO, Web3, NFT, Metaverse etc than this blog suggest.
This was a great series, thank you!
Good article, thank you!
I agree Web3 isn’t the utopia the present thought leaders envision it to be. How close to that utopia is on the end users, how much control do you want to take back from Big tech?
That’s the question to answer, Larry. Frankly, I think the bigger question is – whose utopia does Web3 reflect? As you can probably tell, I’m not a purist. I’m a very pragmatic person – and I keep thinking: what are the impacts of making the internet more democratic or – perhaps – anarchic? I get that DAOs are supposed to operate as a kind of localized governance to prevent mass chaos, but still: it’s a very interesting set of questions to mull over.
It is coming fact and very necesary! Good blog!
I’m still on the sidelines with the metaverse. Let’s see how this interactive pay-to-play and be-sold platform unfolds.
Randy, I’m also very interested in how people react to pay-to-play models, which is why the monetization of decentralized applications fascinates me. So much yet to unfold.
I have different opinion on the matter (not so pessimistic), but thank you for sharing with us.
I’d love to hear it, Alim! I have lots of very smart people I know and respect who also disagree with me, so I’m used to having my perspective being perceived as a bit…unpopular. 🙂 Thanks for reading!
So much information, so little time. Love this article, it is so enlightening.
Learning every day!
I am very interested to see a future where we can have decentralized identity backed by immutable blockchain with proven verification. Not just verification of identity, but of assets such as documents and certificates. Looking forward to seeing what startups in this area will do tk bridge the gap between web2 and web3. I do t think it’s just about the metaverse.
Love this idea! The immutability of blockchain can provide some great value when it comes to authenticity, so I agree that’s an excellent thing to explore, Brad.
While I applaud the enthusiasm and intentions of the die-hard Web3 fans I think it’s too tech-wonky to get the average user to care. The benefits are abstract. Look to social platforms like Mastodon as examples. In theory it’s great, but most people simply don’t care enough to move to it.
The adjacent tech that’s noted in the article like NFTs and crypto feel like they do more harm than good and lead to some interesting scams and exploits. Maybe there’s some good here, but it feels a long way from being something the average user will seek out. I’d be happy to be wrong about that but I’m just not optimistic.
100% Cody. Thus opinions #4 and #5: (4) The majority of people won’t really care about the ethics of a decentralized Internet.
(5) There is still work to do in persuading users to pay for the Creator Economy that is constructing Web3. Scams are rampant but the opportunity is there – as of now, it’s a speculative, wild environment. But I really do foresee more strategic, secure Web3 applications and platforms will develop in the future. No matter what, I’m delighted that the stuff we build will be the foundation for the future of the internet, whatever form it takes.
The biggest difference is going to be the funding of web3 platforms. No more Big Techs – no more sponsors. Most of Mastodon instances require cost sharing between users using specific instance. How many users want to pay for more privacy?
It’s like fiction, read about the metaverse
thanks for the information. metaverse just appears to be the next generation of the “subscription model” in gaming / services / tv streaming, ect..
I agree with your assessment, Philip – the Metaverse is indeed another advancement in interfaces and business models that reflect the changing social and demographic environment, which is best seen today through streaming and gaming. And the subscription piece is fascinating because I’m not sure how people will respond to paying out of pocket for the creator economy, making crypto micropayments in the open Metaverse, or token or digital payments in the closed Metaverse, for unique experiences. I think there will be a very, very strong presence of companies that continue to offer superior value in exchange for our data – rather than our dollars.
Really interesting Blog Post, Thanks!
Very interesting blog…
This objective very interested, Thank you for sharing.
An interesting glance into the future.
Interesting read not sure if I completely see the vision but I am excited for the future.
the relationship between machine and person will be the future of technology. congratulations for this post
These are unproven stuff , however good to see progress on DAO, Web3, AI , NFT, Meta to see how it can help network operations . Great article .
Thank you for the information.
I want to understand more on the Open and Closed Issues? What are the spicifics ?
Open Metaverse runs on a distributed ledger backend. Closed Metaverse runs on a centralized backend on cloud or On Prem. An Open Metaverse enables people to move from one world to another with specific digital assets of identities attached. You carry your Nike sneakers with you from The Sandbox to Decentraland to whatever other Open world you want. Whereas if you have a Closed Metaverse like Accenture’s VR system they use to onboard new employees, you choose your avatar and it stays inside that world and on that server.
This is the future, and it will progress even beyond this.
Incredible, but true, the metaverse is our present, thank you.
Nice post, thank for sharing
Bit Like paying for a Blue Tick on Twitter
Looks like didnt work this time
Can’t wait to test things out
The future really is going to be human-machine interaction.
While I dont agree with all the statements or dont want to see a world where the metaverse takes precedence then real world… this provides a glimpse of a possible future
I think that when I consider the Metaverse as Augmented Reality, I’m not so opposed to our physical world being augmented by technologies. I just don’t want it to replace the physical world altogether.
This is an interesting number, ” In fact, 78 percent of Millennials are more likely to select a brand with a loyalty/rewards program.*” I definitely do not argue it and it makes sense.
Appreciate your input on these topics. It will be interesting to see how these concepts develop.
I agree with much of your opinions. The truth is always inconvenient for someone.
Thank you.. this post is very helpfull
Will the machine take over?
Automation is so important.
we need an open metaverse
Interesting assessment of an important topic.
With a recent fiasco of FTX and the myth of decentralization perishing to ashes along with Meta’s massive layoffs, the future of the Web 3 and the Metaverse doesn’t look bright.
That’s a pretty popular opinion right now actually, @Muhamed. There are cultural philosophers waxing poetic about whether Meta did more to destroy the potential of the Metaverse or to accelerate its adoption, or saying that FTX is just emblematic of the problems that Web3 will always have. I think that the truth is more nuanced. I think of Meta’s metaverse like I think of Google Glass – expensive, and before its time. I think of FTX like I do any large successful Ponzi scheme. People lied and made decisions against their terms and conditions to steal the money. But I think my nature as a futurist is as an optimist, so I still see these events as road bumps rather than stop signs.
Thanks for the update on the decentralized future of the internet.
food for thought
Another interesting read. Thank you!
The risk and reward of investment in an algorithm may be preferable to that in a regulatory entity, which may be corrupt and assume superfluous overhead expenses. Innovation is driven by investment based on debits and credits, and with risk that is not always fully assumed by an individual.
There is value in transparent, trusted frameworks; and value in unique goods and services, some of which may be distributed over the internet.
Something to consider is how to verify transactions that involve goods and services represented as data.
It’s all about trust. And looking at the future, we must seek out insight from the past. Over the past decade, trust in institutions has fractured – with the Mortgage-backed security crisis an excellent proof point. The decentralization movement is a movement away from regulated control – but with that comes the serious risks that we’re seeing now in the wild west of Web3. The ideal is…idealistic. I’m far more practical, but I can hope for a future where there is a vibrant self-regulated ecosystem of traceable internet transactions between parties, which preserves identity and telemetry while delivering value and connection. It’s far out though. and it still requires interoperability – which requires agreements between parties, and trusted frameworks. No matter how you spin it, someone is trusting something, believing in something, and that won’t change. What’s changing is what people trust, what they believe in, and ultimately, how they perceive the ethics of control.
Good article. But I think AI still long way to go.
thank you for sharing this Topic with us. but It also should be mentioned that they can’t be replaced with Human.
Excelente blog y da una breve explicación de los movimientos del presente.
Espero seguir viendo mas de este tipo de contenido.
Great read, thank you!
Great article, thank you!
This was a great series, thank you!
This is the future of things.
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