Metaverse among disruptive tech to shape 2022
While connectivity, digital transformation and telemedicine dominated 2021, this year is expected to be shaped by the metaverse and the future of work.
This is according to data and analytics company GlobalData’s “Tech, Media & Telecom Predictions: 2022” report, which identifies the top 30 themes impacting the tech, media and telecoms (TMT) industry.
GlobalData describes a theme as anything that keeps a CEO up at night. Its focus on themes aims to give companies an opportunity to invest in the right areas in their industries to become success stories, notes the firm.
During a webinar presentation of the TMT Predictions 2022 yesterday, GlobalData analysts offered a deep dive into eight of the 30 themes, namely environmental, social and governance (ESG), metaverse, the future of work, quantum computing, space economy, crypto-currency, batteries, and mergers and acquisitions.
“Technology is making it even easier for new entrants to disrupt even the most established businesses, so investment in the right themes is key to a company’s success,” says Emilio Campa, analyst on the Thematic Team at GlobalData.
Top among GlobalData’s TMT Predictions 2022 is the metaverse.
Though the metaverse may not yet be fully realised, early prototypes and use cases will emerge as tech companies strengthen their metaverse capabilities and start-ups develop solutions around data visualisation, collaboration and training, says the report.
According to Emma Taylor, GlobalData’s thematic analyst, the metaverse has the potential to transform how people work, shop, learn, communicate, socialise and consume content.
Taylor comments that big tech will increasingly invest in the metaverse in 2022.
Last year, she notes, there were significant investments made in the metaverse. In April 2021, Epic Games announced a $1 billion funding round to develop the metaverse platform within Fortnite. More recently, in November 2021, SoftBank Group announced it was investing $150 million in a South Korean metaverse platform.
She explains: “The metaverse is attracting significant media attention, including predictions that it will form the next incarnation of the internet. As such, competition will intensify as the tech titans battle for market dominance and non-tech brands explore how metaverses could deliver operational improvements.”
Taylor anticipates game publishers such as EA and Tencent will also join the metaverse development race. “GlobalData estimates cloud gaming alone will generate $30 billion in revenue by 2030.”
In addition, enterprises are expected to be the prime market for metaverse developers in 2022, she states. “New use cases will emerge as Microsoft, Nvidia, Meta and HTC strengthen their metaverse capabilities, and start-ups develop specific solutions around data visualisation, collaboration and training.
“The big players will engage in key mergers and acquisitions to bolster their metaverse offerings.”
According to Taylor, the use of augmented and virtual reality will be integral in the metaverse.
The metaverse is loosely defined as an extensive online world where people interact via digital avatars. Companies like Meta (formerly Facebook) have announced plans to develop metaverse experiences, services and hardware.
In SA, for example, the metaverse and non-fungible tokens market is expected to gain popularity this year, as more local companies dabble with immersive technologies to deliver operational and revenue improvements.
GlobalData analyst Rachel Jones points out that it’s no surprise ESG remains the major theme for 2022.
According to Jones, the 2021 United Nations Climate Change Conference (COP26) brought climate action to the forefront of the political agenda, where discussions regarding climate inaction were debated.
Jones says ESG will be discussed in all corporate boardrooms throughout 2022, with GlobalData predicting ESG disclosures will be an expectation in 2022.
“The role of the private sector in assisting the transition to a low carbon economy is becoming increasingly prominent thanks to the exposure created by COP26.”
GlobalData is of the view that commitment to the SBTi (Science Based Targets initiative) and Amazon’s The Climate Pledge will accelerate in 2022, Jones noted during the webinar presentation.
“Where companies pledge climate action, they will win stakeholder approval, which can therefore drive a competitive advantage.”
GlobalData predicts there will be a regulatory crackdown on big tech, especially regarding how they manage misinformation and online harm, says Jones.
Therefore, companies that disclose their ESG policies effectively and actively improve their ESG are the winners in this theme. Those that don’t will lose out, she expresses.
“Governance is a key issue in the tech sector as they [big tech companies] repeatedly evaded accountability for things such as data breaches, fake news and online abuse, which has persistently spread across the various social media platforms. However, it seems the time of this regulatory Wild West is up.”
Turning to the future of work, GlobalData’s Amrit Dhami notes hybrid working will remain commonplace in 2022, as workers enjoy the flexibility and lack of a commute.
“Companies must be flexible to retain and attract top talent,” Dhami says. “The gig economy will also continue to expand, catalysed by COVID-19 lockdowns and the explosion of quick commerce.
“However, the gig economy model will become increasingly unsustainable, due to landmark regulatory changes across Europe, classifying more and more gig workers as employees rather than independent contractors.”
According to GlobalData analyst Dan Clarke, the US and Europe will work to consolidate their own lithium-ion battery supply chains in 2022.
US manufacturers in the transportation equipment, electronics and chemicals industries will re-shore production due to concerns over electronic vehicle battery production and domestic semiconductor supply.
Says Clarke: “Batteries are crucial in digital technology, renewable energy and electric vehicles, three areas that are important now and will be increasingly important in the future. There is also likely to be a lot of vertical integration next year, where automakers move into building batteries or processing plants, or simply securing long-term partnerships as Tesla and Panasonic have done.”
The GlobalData report indicates that decentralised finance (DeFi) will disrupt traditional financial institutions and is set to be the killer use case of crypto-currency.
“Start-ups will lead DeFi platform innovations with retail investors as the primary targets. Institutional bodies will catch up with the trend through the introduction of Central Bank Digital Currencies and the adoption of stablecoins.”
The cyber security industry will develop quantum-resistant encryption before RSA codes are broken, notes the report. However, future quantum computers could break secure communications captured today. “Therefore, companies will implement quantum security solutions in 2022.”
In terms of the space economy, the report reveals the expansion of satellite networks will provide almost 70% of the space economy’s growth in the near term, facilitating larger aspirations.
“Plans for space business parks from aerospace leaders will see commercial actors have a more sustained presence in space, signalling a commercial infrastructure boom in the longer term.”