The metaverse has taken a backseat in terms of media attention and investor sentiment about the future of technology. However, companies continue to pour billions of dollars into the hardware and software that allow people to connect in a virtual space. That suggests there may still be some investment opportunities here.
If you’re interested in the companies leading the way in the metaverse, three major tech companies should be the focus of your research. Apple (NASDAQ: AAPL), Meta Platforms (NASDAQ: META)And Unity software (NYSE: U) are the standout leaders in the metaverse today.
Whether it’s intentional or not, Apple is a leader in the metaverse. The company makes and sells a number of devices that consumers will use to communicate virtually, whether those are smartphones and computers or next-generation virtual reality headsets like the Vision Pro.
Apple will also play a role in creating and capturing virtual spaces. Most Apple iOS devices now include LiDAR, which can help you map rooms or provide spatial information about how far away the distances are in a virtual space. Apple’s Augmented Reality Kit (ARKit) is also a leading digital asset platform and is built into hundreds of millions of devices.
The metaverse will need hardware to communicate with virtual space, and Apple will be at the center of that hardware race. Apple may not be building the metaverse, but it is building the devices we use to get there.
Meta Platforms changed its name from Facebook to tell investors that this is now a meta-averse company. Mark Zuckerberg spends more than $10 billion annually building the hardware and software to make his vision a reality. So far it hasn’t led to financial success or widespread adoption, but that hasn’t stopped Meta Platforms.
The Meta Quest 3 is the latest virtual reality headset from Meta Platforms, built to interact with metaverse assets the company creates. It’s hard to call this device (or VR in general) a success for Meta, but it could lead to the technology that eventually becomes successful.
Meta’s Ray-Ban sunglasses are an example of where this technology could be used in more devices. They’re capture devices today, but they’ll likely add AR features in the future, bridging the digital world and the physical world in a more natural way than Quest or Apple’s Vision Pro. Meta is also starting to integrate artificial intelligence, which could be revolutionary in the metaverse. Users can ask the AI to virtually call someone, create 3D items, or display a sporting event or TV show in the virtual world.
Meta Platforms may not be the dominant VR company in ten years, but it’s hard to argue that it won’t be a connective tissue in the metaverse, and that’s not a bad place to be.
3. Unity software
There are two game engines competing for metaverse leadership: Unity and Unreal. Unreal, made by Epic Games, has become the better high-fidelity game engine, but Unity’s claim to fame is the tool of choice for creating iOS games and VR content, and it’s a preferred partner of Vision Pro at launch.
Unity has struggled to find its footing as a publicly traded company as its business model has changed and advertising revenue has not risen as hoped. These are challenges that management must overcome, but the value of Unity for metaverse developers is not in question.
This is still the leading game engine for virtual worlds, and I think it’s more likely that Unity’s quality will improve than developers switching to Unreal wholesale.
The future of the metaverse
What we don’t know is what the metaverse will look like in ten years. Will it be a ‘place’ where we meet friends and do business, or will it be more like a 3D conference call?
Wherever we go in the metaverse, Apple, Meta, and Unity will be big players. This offers many advantages and possibilities for investors.
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Randi Zuckerberg, former director of market development and spokeswoman for Facebook and sister of Mark Zuckerberg, CEO of Meta Platforms, is a member of The Motley Fool’s board of directors. Travis Hoium has positions in Apple and Unity Software. The Motley Fool holds positions in and recommends Apple, Meta Platforms, and Unity Software. The Motley Fool has a disclosure policy.
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