The ‘Metaverse’ and the challenge of responsible standards development

ABSTRACT

On June 21, 2022, the Metaverse Standards Forum (or ‘Forum') was announced with 35 founding members, including Meta, Microsoft, NVIDIA, Sony Interactive Entertainment, Cesium, the Web3D Consortium, and the Web 3d Consortium. The Forum, a unique coordinating structure designed to develop agreement on fundamental technical, interoperability protocols for the metaverse, may provide the technical foundation for later established open (and inclusive) standards (from emergent dominant designs) in relevant technology domain standards development organizations. If implemented with a diverse array of metaverse relevant stakeholders, this exercise in pluralistic inclusion will allow for a socially and ethically responsible consensus to be embedded in the foundational outcomes, i.e., protocols, developed by the Forum. Moreover, it will have the key benefit of a ‘legitimacy’ that the industry will be able to utilize in the social and public policy arenas moving forward with formal standards-setting, and eventual commercial implementation, of this potentially revolutionary, disruptive technology.

KEYWORDS:

• Metaverse
• Metaverse Standards Forum
• responsible standards development
• stakeholders

I. Introduction

On 21 June 2022, the official launch of the Metaverse Standards Forum (hereafter ‘MSF’) was announced with 35 founding members, including Meta, Microsoft, NVIDIA, Sony Interactive Entertainment, Cesium, the Web3D Consortium, and the Web 3d Consortium (Metaverse Standards Forum 2022a; Metaverse Standards Forum 2022b). Noticeably missing among these founding members, however, include Tech giant Apple, gaming companies Roblox and Niantic, and emerging crypto-based metaverse platforms such as Sandbox and Decentraland (Reuters 2022). By late August 2022, there were over 1200 organizations that had joined the Forum¹ (Metaverse Standards Forum 2022b).²

What is the ‘metaverse’? While often vaguely described, Ball (2022), a former Amazon executive and author of The Metaverse and How it Will Revolutionize Everything, defines it as the ‘next generation internet’ or parallel virtual world intended to have the immersive feel of the real one. Bobier et al. (2022) describes the metaverse as emerging from the convergence of three major digital technologies: gaming, augmented reality/virtual reality (AR/VR), and Web3. These technological developments among these major digital technologies will result in platform ecosystems consisting of connected but unrelated stakeholders of different backgrounds (Kenney and Zysman 2016), as well as complex systems consisting of components from different sectors that are converging towards each other (van de Kaa, De Vries, and Rezaei 2014).

As previously mentioned, the metaverse is popular with those individuals and companies working to develop ‘Web 3’ and whose purpose is to build a blockchain-based internet that is largely beyond the control of public regulators, banks and today’s tech platforms (Ball 2022). Major firms, including Citi, Goldman Sachs, KPMG, McKinsey & Company and Morgan Stanley, variously project that the metaverse will contribute from $2.5 trillion to $16 trillion to the global economy by 2030 (Ball 2022) – with McKinsey and Company estimating that for the first five months of 2022, global metaverse investment reached $120 billion or more than double the $57 billion invested in all of 2021 (McKinsey Blog 2022).

It has become obvious that the interplay of these technologies, and the popularity and significance of platform ecosystems, requires the development of technology standards at multiple levels, from the data, to the functional interfaces, and to the protocols (van de Kaa, Viardot, and McCarthy 2022). Multiple industry leaders have stated that the potential of the metaverse will be best realized if it is built on a foundation of open standards (Metaverse Standards Forum 2022a). An open standard is a standard that is openly accessible, is usable by any participant, and any entity can participate in its development (Opensource.com 2022). Furthermore, technical standards – which are applicable in the metaverse – are established norms or rubrics for ‘common and repeated use of rules, conditions, guidelines or characteristics for products or related processes and production methods, and related management systems practices’ (The White House 2017).³ The MSF is an example of an organization that is a ‘voluntary consensus standards body’, which plans, develops, establishes, or coordinates voluntary consensus standards using agreed-upon procedures (The White House 2017).⁴

Responsible standards development is a critical part of the process of commercial research and innovation. The concept of’ responsible innovation (RI) has been described as ‘an inclusive and risk-mitigating approach to research and innovation’ (Wiarda et al. 2022, 64), and aims to ensure that unintended negative impacts are avoided, that barriers to dissemination, adoption and diffusion of research and innovation are reduced, and that the positive societal and economic benefits of research and innovation are realized (UK Research and Innovation 2022). To better meet that aim, innovating businesses should consider the unintended consequences, questions, ethical dilemmas, and social transformations – as well as the impact – of their innovative technologies upon their own organization, customers, suppliers, investors, the wider society and the environment (UK Research and Innovation 2022).

Within the scholarly field of RI there is a consensus that responsible processes require at least four forms of anticipation, inclusion, reflexivity, and responsiveness (Fraaije and Flipse 2020; Stilgoe, Owen, and Macnaghten 2013). The ‘inclusion’ form is critical to the success of the technology standard development process – and ultimate adoption of standards – because ‘it involves broad and early engagement with stakeholders (and users of the technology) to yield diverse insights’ (Bauer, Bogner, and Fuchs 2021; Chesbrough 2003; Wiarda et al. 2022, 65). The inclusion form, i.e. the early involvement of engagement with stakeholders and the inclusion of diverse information (De Vries 1999; Markus et al. 2006), is a dimension to RI which helps to address the ‘Collingridge Dilemma’ (Collingridge 1980). The Collingridge Dilemma describes the knowledge deficit confronting how to shape innovations before path dependencies develop (David 1994, 1995), and technology lock-ins emerge (Arthur 1989), both important effects on the collective action required in the standards development process (Hargrave and Van de Ven 2006; van den Ende et al. 2012) and improving a standard’s content (Egyedi 1996; Schmidt et al. 1998).

This reference to organization, customers, suppliers, etc. aligns with the concept of ‘stakeholder’, a term which means ‘any group or individual which can be affected by an organization’ (Freeman 1984). The application of ‘stakeholder theory’ – a set of propositions that suggest that managers of firms have obligations to some group of stakeholders (Freeman 1984) – is now being referenced in the responsible innovation community (See da da Silva et al. 2019; Bacq and Aguilera 2022; and Braun and Starkbourn 2023). This is an avenue to explore in research scholarship to attempt to integrate stakeholder theory with responsible innovation scholarship. Moreover, what better way to involve these various relevant stakeholders into the foundational discussions involving consideration of the questions, consequences, and ethical dilemmas when developing ‘responsible’ technical standards that companies will be adopting when creating and manufacturing future products for the metaverse? Currently, broad inclusivity – and by extension, stakeholders – in the technology standards development process is generally not the case in the consortia organizational format. This outstanding question remains to be addressed: While pluralistic stakeholder inclusion may be a challenge for the Metaverse Standards Forum, what active SDO efforts to identify and include relevant stakeholders in this process should be undertaken by this consortia to help shape effective and commercially viable standards for future adoption?

II. Activities and structure of the Metaverse Standards Forum

The MSF defines its purpose as bringing together leading Standards Developing Organizations (SDOs)⁵ and companies for industry-wide cooperation on interoperability standards needed to build the open (italics added) metaverse for everyone (Metaverse Standards Forum 2022a). These application technology standards will potentially be developed to include interactive 3D graphics, augmented and virtual reality, photorealistic content authoring, geospatial systems, end-user content tooling, digital twins, real-time collaboration, physical simulation, online economies, multi-user gaming, and more (Metaverse Standards Forum 2022b).

The MSF, open to any organization at no cost, will focus its efforts on pragmatic, action-based projects that will include implementing prototyping, hackathons, plugfests, and open-source tooling to accelerate the testing and adoption of metaverse standards, while also developing consistent terminology and deployment guidelines (Metaverse Standards Forum 2022a). Noteworthy is that the MSF will not create standards itself but will coordinate requirements to foster the creation and evolution of standards within SDOs working in relevant domains (Metaverse Standards Forum 2022b). Moreover, these standards will also be built on some existing protocols.

Multiple industry leaders have stated that the potential of the metaverse will be best realized if it is built on a foundation of open standards (Metaverse Standards Forum 2022a). Building an open and inclusive metaverse at pervasive scale will demand a constellation of open interoperability standards created by SDOs such as The Khronos Group, the World Wide Web Consortium, the Open Geospatial Consortium, the Open AR Cloud, the Spatial Web Foundation, and many others (Metaverse Standards Forum 2022a). The MSF aims to foster consensus-based cooperation among diverse SDOs and companies to define and align requirements and priorities for metaverse standards – accelerating their availability and reducing duplication of effort across the industry (Metaverse Standards Forum 2022a).

What is unique about the MSF (in its precursor role) is its coordinating structure designed to develop agreement on fundamental technical, interoperability protocols for the metaverse that will provide the technical foundation for later established open (and inclusive) standards in relevant technology domain SDOs. This coordination of MSF activities – such as focusing on 3D asset interoperability – will result in pragmatic projects whose results will attempt to fill gaps where there is a lack of interoperability that is restraining metaverse deployment. The MSF’s efforts will attempt to ‘accelerate’ the standards development and adoption process (during the era of ferment of metaverse technology development) by improving communication, transferring/sharing knowledge, and organizing and coordinating resources among all relevant stakeholders to applied projects whose goal is to overcome these interoperability challenges. In conclusion, the MSF is an organized approach across technology-based industries to accelerate the time (and reduce costs) to standard-setting and eventual commercialization of metaverse-related products.

III. Stakeholders, inclusion, and MSF standards development

According to White and Bruton (2017, 244), ‘the management of technology and innovation has ethical concerns that can be unique.’ Such ethical concerns are informed by values, values that are embraced by the relevant stakeholders of an organization (Freeman 1984). Moreover, if an organization places its resources to work in a socially responsible way, then it should have reasonable expectations of positive outcomes for the organization and the broader society (White and Bruton 2017). In the case of the MSF, there are relevant stakeholders who have a stake, or an interest, in the success of the metaverse. These stakeholders represent not only those companies and SDOs that directly economically benefit from the eventual comm-ercialization of the metaverse, but also those organizations and entities who are affected by the operation of this new technology. Beyond the tech companies initially involved in the development of the metaverse and SDOs, who are these stakeholders? A preliminary list of such entities would include the suppliers of software and hardware; government representatives who might regulate or utilize ‘metaverse’ services; consumer interest/advocacy groups; potential future competitors in this space; and representatives of the financial community, especially venture capitalists.

So what does responsible innovation in the metaverse look like? Today’s internet lacks the protocols, standards and architecture to support live, synchronous and highly-scaled 3-D experiences (Ball 2022). Furthermore, we have to acknowledge that Big Tech presently controls much of the global economy and thus shapes much of our daily lives. Given this reality, an existential question for our modern society is: Do we want to allow Big Tech to draw us into new virtual worlds of its own making (Ball 2022)? Ball (2022) argues that ‘[A]s with almost all technologies, it is neither moral nor immoral.’ He believes that after the metaverse arrives, ‘it will reflect the business models, philosophies and objectives of those who design and operate it, which customers can choose to accept or reject’ (Ball 2022).

But long before that time arrives, the MSF – which is open to free membership from a wide variety of stakeholders – should actively encourage a diverse array of metaverse relevant and engaged stakeholders, both those affecting its operations, e.g. competitors, and those entities who may be affected by the actions, decisions, policies, or practices of the organization, e.g. consumers, philosophy of technology ethicists, government representatives, etc. This exercise in pluralistic inclusion (i.e. pluralism means diversity of stakeholders, and the more diverse voices actively involved (‘inclusion’) in the standards development process, the less concentrated power there is in the process of democratically developing the metaverse)⁶ could allow for a responsible consensus on the typologies of knowledge necessary to be embedded in the foundational outcomes, i.e. protocols, developed by the MSF.

Moreover, this pluralistic inclusion could have the key benefit of societal legitimacy that the industry will be able to utilize in the social and public policy arenas as it moves forward with formal standards-setting processes and eventual commercial implementation of this potentially revolutionary, disruptive technology. Furthermore, this question of societal legitimacy may have ramifications for exploring the social and ethical responsibility that may exist in the standards development process in the evolution of the metaverse. In conclusion, it can be argued that building an open and inclusive metaverse can result from embracing open standards and a pluralistic view of involving relevant stakeholders in the potential commercial growth of this nascent virtual world of tomorrow.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

Thomas A. Hemphill

Thomas A. Hemphill, David M. French Distinguished professor of strategy, innovation and public policy, School of Management, University of Michigan-Flint, received his Ph.D. in Business Administration with a primary field in Strategic Management and Public Policy and secondary field in Technology and Innovation Policy from The George Washington University. His technology and innovation management publications can be found in the Bulletin of Science, Technology & Society; Innovation: Management, Policy & Practice; International Journal of Innovation Management; International Journal of Innovation and Technology Management, Journal of Responsible Innovation, Knowledge, Technology & Policy; Research-Technology Management; Science and Public Policy; Technology Analysis & Strategic Management; Technology In Society: An International Journal, and Technological Sustainability.

Notes

1 There are two levels of Forum membership: ‘participant’ organizations can engage in forum discussions and projects, while ‘principal’ organizations are those who wish to assist in Forum oversight and may desire to fund Forum projects (Metaverse Standards Forum 2022b).

2 The Metaverse Standards Forum can be considered a ‘consortium’ dedicated to developing technology standards for the emerging metaverse. Hawkins (1999, 161) defines a ‘consortium’ as …  an informal alliance of firms, organizations, and (sometimes) individuals that is financed by membership fees for the purpose of co-ordinating technological and market development activities. Informality is key characteristic as most conventional industrial networks operate through formal sub-contracting arrangements, or through partnerships and joint ventures. Typically, consortia set out very explicit objectives and agendas, but pursue them through very ‘informal’ working procedures.

3 A technical standard includes ‘the definition of terms; classification of components; delineation of procedures; specification of dimensions, materials, performance, designs, or operations; measurement of quality and quantity in describing materials, processes, products, systems, services, or practices; test methods and sampling procedures; or descriptions of fit and measurements of size or strength’ (The White House 2017).

4 ‘Voluntary consensus standards’ are standards developed or adopted by voluntary consensus standards bodies, both domestic and international (The White House 2017).

5 A ‘standards developing organization’ – or SDO – is ‘an organization whose primary function is developing, coordinating, promulgating, revising, amending, reissuing, interpreting, or otherwise contributing to the usefulness of technical standards’ (Ping 2011). In 2004, the Standards Development Organization Advancement Act was enacted by the U.S. Congress (Federal Trade Commission 2004). The Act provides SDOs with the opportunity to limit their antitrust liability for standards development activities to actual, as opposed to treble, damages if found guilty of an antitrust violation (Federal Trade Commission 2004).

6 This idea/concept of ‘pluralistic inclusion’ was developed by the author through the inspiration of Walji and Shah (2020).