Metaverse and Privacy Concerns

Executive summary

Brief Overview of the Issue: Metaverse is a digital computing experience that can be enabled spatially as an alternative to real-world circumstances. This computing platform is based on the blockchain. It incorporates elements of major civilizations, including social interaction, the trading of goods and services, the use of money, and the ownership of property.

Recommendations: The suggested recommendations will work if the proposed technology aligns with the business process, decision-making, and business actions. With this, has allowed companies to share their values and helps to gain “buy-in” that enables organizations to achieve the set goals and objectives.

Summary of Value Results: The main advantage of employing Metaverse technology is that it enables immersive digital connections that let customers and producers communicate. The economy of the Metaverse, the interoperability platform, user identities, and permanence all present hazards; hence businesses could need to reevaluate the verification, security, privacy, and customer protection issues to deal with these challenges.

Next Actions: Businesses should lay the groundwork by prioritizing Metaverse hiring, customer research, and skill development over other initiatives. Businesses utilizing Metaverse ought to concentrate on what clients want by using some client-facing proofs of concepts.

Introduction

Metaverse is a computing technology that can be used spatially to enable digital experience as an alternative to real-world scenarios. This computing platform is built on the blockchain, along with key civilizations factors like social interaction, exchange of goods and services, currency exchange, and property ownership. With technological advancements, worldwide privacy has been an issue of concern regarding how information is collected and how it can be protected. However, this innovative strategy enhances innovation in different sectors, from education to e-commerce. According to Vittorio (2022), Metaverse is predicted to generate more than 5 trillion dollars for the growing economy by 2030 (Vittorio, 2022). The difficulty for users of extended reality (XR) technology is to weigh the benefits of their potential applications against the privacy risks of all their possible data points.

According to O’Neil (2022), marketers are not the only people concerned with Metaverse data privacy; consumers are equally worried. This conclusion was drawn from a fact survey on Metaverse data privacy where 50% of the respondents were worried about user identity issues, 47% were concerned about forced surveillance, and 45% considered potential abuse of personal information (O’Neill, 2022). Since Metaverse is a complex space, privacy issues surrounding its implementation and use are complex. This brings in the question of what would happen when data mined from the use of this technology is up for grabs. The lack of an exemplary data privacy structure poses security and privacy concerns that challenge this digital space.

Business Drivers

Different key inputs and activities in business have pushed for the use of Metaverse technology. The use of this technology comes across as an evolutionary step that helps business achieve their set target. Business drivers that have triggered the use of this technology include;

Desire to enter virtual markets.

This technology can help companies transform how they interact, live, buy and sell their products (Mystakidis, 2022). Metaverse can help businesses deliver digital items and be able to create virtual entities such as financial institutions, malls, and gallery stores. Hence companies desiring to enter virtual transactions in the form of goods, services, and finances could go for the Metaverse 3D business community.

Need for a natural interface

Businesses that aim to enhance the most convenient and natural interaction between them and their customers require this technology. This may be in the form of voice recognition and the ability to use objects with bare hands, all of which are natural interfaces that influence the extensive use of Metaverse (Mystakidis, 2022). To achieve this, businesses need to enable interaction at different transaction levels in a way that has not been seen before. With lots of companies seeking a more evolutionary way to interact with their target market, the majority have been able to create Metaverse solutions to their privacy concerns.

Scope of the study

Purpose of the study

The main objective of this study is to evaluate and analyze the use of Metaverse technology and the privacy issues that arise. By analyzing the key processes and resources used, this research will also explore the use of this technology in business and how it has made a change.

Options evaluated

Companies can use technology to enhance business success; this includes the use of Metaverse and virtual reality. As discussed earlier, Metaverse is a virtual space reality that connects the physical and digital worlds (Mystakidis, 2022). Users, in this case, scenario, interact using 3D avatars to be able to offer users immersive experiences. Metaverse technology is not simply a web space; it is broken down into several types: traditional, centralized blockchain-based, and decentralized blockchain.

• Traditional Metaverse

Traditional Metaverse system in business does not incorporate blockchain analysis in their operations. It involves the use of virtual spaces that are controlled by a user who has an avatar. In these virtual worlds, role-playing is typically involved. However, it is possible to graft a blockchain into these interfaces to create a digital economic system (Mystakidis, 2022). This type of technology is advantageous as it has more users than other forms. Apart from business, it has widely been used in game fornite and brands that want to bet on quantity. Fashion brands can easily be found in this Metaverse since it uses an avatar as a central component. Users could choose from wearables for their avatar or engaging games that unlock rewards, according to brands.

• Centralized blockchain

The centralized Metaverse system operates on virtual spaces controlled by a central organization that accounts for the user’s data. Blockchain allows for interactions that will evolve with time within these virtual spaces (Sparkes, 2021). Users can then monetize their purchases and creations in a fully developed digital economic environment created by this technology system. Additionally, Non-Fungible Tokens, traded or exchanged, can be found in these systems. It uses cryptocurrency payments, but a third party is supposedly in control of the user data.

• Decentralized blockchain Metaverse

This technology system is usually based on a technique known as Decentralized Autonomous Organization. This system allows smart contacts, which build the rules within a given Metaverse system. The decision-making power within this system does not rely on the central organization; it lies within the users (Sparkes, 2021). It gives users complete control of tokens on the decisive role of the administration. Blockchain in this type of technology helps develop virtual economies based on cryptocurrencies. With these characteristics, this type of Metaverse is the most successful among the three, and it embodies what Metaverse genuinely is.

The idea of wealth redistribution makes more sense in decentralized platforms because the governance structure is horizontal. The user can reclaim control over what is rightfully theirs in the first place. For instance, a content creator can resell and monetize their works on these sites (Anderson & Rainie, 2022). Decentralized Metaverses also allow the user to receive rewards in the form of goods or virtual money. People earn by playing, creating content, or engaging themselves in business activities that employ this form of technology. We can readily locate socially conscious organizations in these Metaverses that strive for equality for all and just redistribution of power within the community.

Business Analysis process and resources

SWOT analysis

Businesses are already looking into selling and marketing in the Metaverse. Companies may create more interactive, individualized, and customized user experiences to target consumers since the Metaverse uses virtual and augmented reality technologies. There are essential factors to consider if your company wants to prepare for and grow in the Metaverse. These include pros like crimes, cyberattacks, the need to acquire suitable technical infrastructure, the requirement for skilled workers, advantages like possibilities to engage consumers, new income models, and increasing your digital footprint.

Using this technology in business has helped open up doors, with most of its success relying upon utilizing data effectively. With this in mind, we can see how companies use their data to analyze and extract information in business (Anderson & Rainie, 2022). Metaverse can be used to conduct sales, marketing, or maintain a solid customer base. Thanks to the Metaverse, data can help marketers engage with people deeper. There has never been a better time for businesses to investigate the Metaverse’s limitless possibilities and how data may transform it into something exceptional and disruptive.

Examples of business entities that have applied this technological concept are Adidas and Balenciaga. Others, such as Disney and epic games, are following suit and have been able to make the most out of using this application. For efficiency, decision-makers need to use a connected cloud data platform to gather and analyze structured and unstructured data (Vittorio, 2022). With this form of data collection and organization, businesses can gain knowledge that will aid in future forecasting outcomes. This begs the question of how companies can navigate data privacy and security using Metaverse technology without losing privacy concerns.

To be able to answer this analysis question requires building more data security measures that are not nonexistent. Other difficulties with Metaverse include navigating the environment, guaranteeing smooth integration, and ensuring that users and brands maintain their reputations (Vittorio, 2022). Companies may guarantee that their users interact with their virtual environments intuitively and thoughtfully by putting data at the center of their marketing strategy.

Analysis

Key Assumptions of Analysis

As companies dive into this technology, they need to pay more attention to technologies that can help build a scalable Metaverse to help curb privacy issues.

• Strategic alignment has helped companies to achieve their strategic goals and objectives through strategic alignment and architecture.’
• Business process impact assessment has been used to calculate the cost associated with Metaverse.
• The biggest hurdle in employing this application is a secure environment in its foundation.
• Metaverse technology can help deliver more revenue and save on cost by aiding in data flow and money in emerging economies.

Analysis of the five pillars

The five pillars that make up the Metaverse include; strategic alignment, architecture, business process impact, risk, and direct payback. These factors form the building blocks that help businesses achieve their set standards.

Strategic alignment

Metaverse technology has been designed to align with an organization’s process, decision-making, and actions. This has allowed companies to share their values and helps to gain “buy-in,” which enables organizations to achieve the set goals and objectives (Lee et al., 2021). This unique digital frontier has commercial and industrial virtual and augmented reality applications. This helps the company to invest heavily in immersive experiences for their customers, partners, and employees. Offices, interactive digital auction houses, training grounds, schools, replicated versions of industries, and industrial machinery are all found in virtual worlds.

With the increasing legal issues and privacy concerns associated with technology use, Metaverse has strategically aligned its engagement to align with environmental, social, and state priorities (Dey, 2022). It has an embedded privacy-by-design application installed to help counteract the privacy concerns associated with using technology in business. It has also allowed for the implementation of labor and protection of employment laws for companies that conduct business using this technology. Metaverse has protected company brands, trade secrets, and other intellectual properties by developing strategies for compliance with advertising, marketing, and consumer protection laws.

Architecture

This technology has virtual reality and argumentive reality embedded in it; this has helped to create a completely immersive experience for users. Since it is a sensorial platform, designers and marketers have considered all senses when designing and marketing their brands (Lee et al., 2021). this has given rise to a term known as sensory branding, which has allowed organizations using this technology to impact and resonate with their consumers by targeting at least one of their senses. The new 3D architecture of Metaverse will facilitate changes in how design firms work and the services they offer to their customers (Dionisio & Gilbert, 2018). Architects and designers have the chance to change the business model with the rise of the Metaverse. They could offer solutions, services, and products that can be reused and help millions of users, not just one client, rather than one-to-one services.

Business process impact

This technology is massively predicted to businesses; currently, 35% of customers have never heard of the Metaverse, according to a Gartner Marketing Survey, but by 2026, Garner projects that 25% of people would spend at least one hour a day in the Metaverse for work, shopping, education, social networking, and leisure (Dey, 2022). Prioritizing this form of digital technology by businesses will help accelerate manufacturing processes. Using Metaverse in manufacturing will help speed up stages like trial production, operation management, and marketing.

With the invasion of the 2019 pandemic, business processes and functions have been slowed down. This has pushed for remote operations, with companies opting for Metaverse technology. Despite the benefits, collaboration and creative contacts between coworkers have decreased due to remote employment (Dey, 2022). Metaverse might offer a solution to revive the office atmosphere while maintaining remote or mixed employment flexibility. According to academic studies, when coworkers work remotely, their joint work diminishes. The absence of real-time in-person talks hampers communication. Metaverse may help by designing permanent VR workspaces that promote hallway conversations, staff connection, and collaborative activities.

Risks factors

The biggest hurdle in employing this application is a secure environment in its foundation. Given that this application is built solely on blockchain technology associated with serious gaps in marketplaces, it is prone to malicious attacks (Lee et al., 2021). This is due to the sheer amount of suspicious activities already exploiting blockchain-based services’ delivery. Since it is based on authorization, a user account may get hijacked, making entities expect that identity and authentication will sit at the heart of everything we want to achieve.

Another risk factor of applying this technology is that people might want multiple identities, one for transacting work conversations and a second for personal shopping and entertainment (Dionisio & Gilbert, 2018). As a result, no single identity can be used to confirm that it is you, which adds another level of difficulty. Will blockchain then assist us in comprehending where we’re transacting and with whom? The answer may lie in chained identification. This is a really difficult task, and because blockchain technologies are decentralized and uncontrolled, enforcing laws against the theft of virtual assets or stopping money laundering is extremely difficult.

Direct payback

Metaverse technology can help deliver more revenue and save on costs by aiding data flow and money in emerging economies. Since speculation is still the most common application for cryptocurrencies, almost every blockchain network has a native token that is frequently owned by the development team and project team (Yang et al., 2022). These organizations put a lot of effort into raising the token’s market value, which they then sell for a profit. This technology helps save on costs by lowering the cost of transactions, reducing overhead expenditures. With bitcoin, centralized authentication is not required because payments are made on a decentralized network managed by peer-to-peer networks.

Value analysis results

Top Benefits

The primary benefit of using Metaverse technology is that it allows for digital immersive connection and interaction between consumers and producers (Dionisio & Gilbert, 2018). It has also improved the computerized and virtual economy by transitioning online shops from 2D platforms to accommodate the new 3D design.

Risk analysis

This technology brings new risks and trust challenges for first-timers and regular users (Kemp & Livingstone, 2016). These risks emerge from Metaverse’s economy, the interoperability platform, user identities, and persistence. Companies may need to reconsider the issue of verification, security, privacy, and customer protection. Addressing this challenge is the only way to manage the risks associated with using this technology.

Sensitivity analysis

To determine the outcome of using this technology, parameters such as end-user, platform, and accessibility are analyzed (Kemp & Livingstone, 2016). Platforms for the Metaverse currently being developed are either geared at the consumer or business market. Nvidia wants to rule the corporate, while Epic Games and Roblox focus on consumer end-users. Both markets are of interest to Microsoft and Meta, and each company has a platform tailored to the needs of the other.

Financial analysis

This technology has caused a stir in the society we live in today. Businesses have been able to invest and discuss their future, with researchers anticipating it to grow to a market size of 800 billion dollars by 2024 (Wang et al., 2022). This prediction has made the advancement in the use of this technology the biggest breakthrough in the technology field. Today, Metaverse is more than just an idea; anyone can access it since it exists in our world. With the constant evolution of technology, the cost of technological infrastructure has overlapped the traditional version of the technology. Hence gauging the actual cost of this technology has become complex and difficult.

The price varies depending on several criteria and might be between $10,000 to $400,000 or more. Independent databases, three to four Node-skilled full-stack engineers, and UI/UX developers significantly increase the price of developing metaverse technology (Wang et al., 2022). The price may also change depending on where the development company is located that has the necessary infrastructure and a team of developers with varied skill sets. It is important to note that while calculating the entire development costs for the Metaverse virtual world, annual maintenance and upgrade expenditures should be taken into account at a rate of 20% of the total development cost.

IT governance plan

Lines of ownership for businesses and technical teams

Organizations will probably need a team of experts and engineers to create the Metaverse experience in the next five years. This technical system will present different opportunities for organizations to translate their product line into a virtual experience. In doing so, companies may need to capitalize on technical experts that will keep the system in check to avoid losing money to other companies that have adopted a better Metaverse system.

Service delivery requirements for business and IT

An enterprise with extensive or intricate software and hardware installations and a variety of system requirements benefits from a defined methodology for IT service delivery. This will help to improve the manner in which mate verse technology provides services to its users.

Customization Policy

Personalization of Metaverse with custom features such NFTs have helped to open up new avenues for the generation of revenue. NFTs are the core components of the Metaverse real estate market that allow users to create their own customized locations.

State management storage and lifecycle policies

The government may be able to accelerate attempts to restart trade and commerce that have been negatively impacted by the pandemic by using the Metaverse. The Metaverse is still in its infancy at the moment.

Education and training plans

VR activates the motor center of the brain and develops muscle memory. VR can train anything, from farming skills to fire fighting, in the same way that a flight simulator trains pilots for emergency landings. Spatial training, such as using the hands and body for tasks that are too risky, expensive, inconvenient, or just impossible to do in real life, is one skill that plays to the specific capabilities of the Metaverse.

Next Actions

Conclusion

The Metaverse is a spatial computing platform built on blockchain technology that offers virtual worlds that may be used as an alternative to or a copy of the actual world, complete with social interactions, money, trade, and property ownership. Even while the fictitious virtual reality world that is referenced in literature and movies is still a long way off, the Metaverse’s foundation is already being laid. There are obstacles to that advancement that have posed security concerns; hence the following are recommended.

Recommendations

1. Companies should build foundations by prioritizing Metaverse hiring, customer research and up skilling over other investments. To achieve this, they need the right people, processes and skills that will wring out the most value.
2. Companies using Metaverse should focus on what customers want with some of the customer-facing proofs of concepts. They can do so by ensuring they stay on brand and use existing app data.
3. Building and spreading trust should be enhanced to help address the risks that are associated with the use of Metaverse technology. Trust can be embedded from the start before identifying the significant risks and militating against them.
4. It is also recommended that businesses should be able to define their Metaverse strategy. This will help them to prepare for a new digital world and consider developing products and services that offer lasting utility.

References

Anderson, J., & Rainie, L. (2022). The Metaverse in 2040. Pew Research Center.

Dey, V. (2022). Data Privacy In Metaverse Is An Evolving Concern. https://martechvibe.com/martech/data-privacy-in-metaverse-is-an-evolving-concern/

Dionisio, J. D. N., III, W. G. B., & Gilbert, R. (2018). 3D virtual worlds and the Metaverse: Current status and future possibilities. ACM Computing Surveys (CSUR), 45(3), 1-38.

Kemp, J., & Livingstone, D. (2016, August). Putting a Second Life “metaverse” skin on learning management systems. In Proceedings of the Second Life education workshop at the Second Life community convention (Vol. 20). CA, San Francisco: The University of Paisley.

Lee, L. H., Braud, T., Zhou, P., Wang, L., Xu, D., Lin, Z., … & Hui, P. (2021). All one needs to know about Metaverse: A complete survey on technological singularity, virtual ecosystem, and research agenda. arXiv preprint arXiv:2110.05352.

Mystakidis, S. (2022). Metaverse. Encyclopedia, 2(1), 486-497. https://www.alibabacloud.com/knowledge/tech/metaverse-benefits-and-drawbacks

O’Neil, S. (2022). What Privacy Issues Will Haunt the Metaverse? https://www.lxahub.com/stories/what-privacy-issues-will-haunt-the-metaverse

Sparkes, M. (2021). What is a metaverse. https://www.verdict.co.uk/what-is-the-metaverse/

Vittorio, A. (2022). Metaverse Technology Opens Up a Wider World of Privacy Concerns. https://news.bloomberglaw.com/privacy-and-data-security/metaverse-technology-opens-up-a-wider-world-of-privacy-concerns

Wang, F. Y., Qin, R., Wang, X., & Hu, B. (2022). Metasocieties in Metaverse: Metaeconomics and metamanagement for metaenterprises and metacities. IEEE Transactions on Computational Social Systems, 9(1), 2-7.

Wang, Y., Su, Z., Zhang, N., Xing, R., Liu, D., Luan, T. H., & Shen, X. (2022). A survey on Metaverse: Fundamentals, security, and privacy. IEEE Communications Surveys & Tutorials.

Yang, Q., Zhao, Y., Huang, H., Xiong, Z., Kang, J., & Zheng, Z. (2022). Fusing blockchain and AI with Metaverse: A survey. IEEE Open Journal of the Computer Society, 3, 122-136.