Will Sony and Epic shatter Meta's Metaverse dream?
Fortnite as a starting point and then into the big wide Metaverse: Sony strengthens its partnership with Epic Games with a billion-dollar investment. This deal has great potential.
Sony is doing one better with Epic Games: After an investment of 250 million US dollars in the summer of 2020, the Japanese electronics giant is adding another billion US dollars. The second major investor is KIRKBI, the investment arm of the Lego Group. Both companies are putting in one billion US dollars each in Epic Games.
Epic and Sony: Together into the Metaverse
During the investment in the summer of 2020, Sony CEO Kenichiro Yoshida particularly highlighted the development of Fortnite as a social meeting place for events that go beyond gaming.
Specifically, Yoshida spoke at the time of a "revolutionary entertainment experience," while Epic CEO Tim Sweeney described a "shared vision of real-time 3D social experiences." That sounds like Metaverse long before Mark Zuckerberg launched Facebook's meta-morphosis. More on that later.
The two corporate bosses are now repeating these statements in other words in the wake of the new investment. Yoshida wants to use Epic Games' game engine and Sony's technology to create a Metaverse space for creators and users.
Yoshida cites "new digital fan experiences in sports" and "virtual production initiatives" as growth areas. Yoshida has already highlighted the potential of VR live streaming in the past.
According to Sweeney, Sony's investment will accelerate Epic Games' Metaverse development: "As we reimagine the future of entertainment and play we need partners who share our vision." Epic Games' estimated enterprise value after the investment is approximately $31.5 billion.
Epic Games and Sony are the most exciting Meta challengers
Of all the Metaverse announcements away from Meta, the joint venture between Epic Games and Sony has the most substance.
- Fortnite as a metaverse ramp is years ahead of Meta's Horizon Worlds in every way.
- Sony is established and popular as a gaming, entertainment and B2B brand and has access to many big names in gaming and movies.
- Epic Games brings gigantic know-how and tools around virtual worlds.
- With Playstation VR 2, Sony is planning a new, ambitious attempt at VR
- and has a head start of many decades over Meta in terms of hardware development anyway.
- Sony has already fallen on its face once with the Second Life offshoot "Playstation Home". The company has probably learned from its mistakes back then.
On top of that neither company is struggling with Meta's heavy Facebook legacy – the brands are largely positive and popular, especially among younger audiences.
Meta has (at this point) more money to invest in R&D and many talented teams in place that are continuously setting new standards in XR hardware and software. Quest 2 is a technically impressive and versatile VR headset that is constantly getting better with software updates. Cambria is already in the starting blocks and will possibly make AR applications suitable for everyday use.
Microsoft with Activision Blizzard could still go toe-to-toe, but Microsoft no longer has VR ambitions and seems to be putting the Hololens project on hold right now. XR glasses will play a bigger role in the Metaverse context eventually, though. Without 3D interaction, it's not a true Metaverse.
Epic's Metaverse strategist Tim Sweeney: When will he unveil his master plan?
Epic boss Tim Sweeney has been planning his Metaverse strategy for many years. Back in 2016, he warned that Facebook could one day dominate the Metaverse as a "walled garden."
In the following years, he repeatedly criticized Meta's corporate strategy while emphasizing the future potential of the Metaverse: "The Metaverse is a concept like the Internet. No company can own it."
The next few years will be about rapid growth with the goal of reaching one billion users first, Sweeney said most recently. Whoever reaches that goal first will set the standards, he said.
Sweeney's company is making numerous strategic moves in the Metaverse race itself. Epic Games was quick to switch to the OpenXR programming standard for VR and AR, buys and invests in relevant Metaverse technology, offers the MetaHuman Creator kit for digital humans and is planning its own store for XR software.