This episode looks at how the bubble has burst around many of the emerging technologies that had previously excited the industry, and where publishers are looking now for innovation.
The ‘crypto winter’ has set back many of the projects we saw begin in last year’s exploration of emerging technology. The crash began early in 2022 due to rising interest rates and macroeconomic factors, and as even supposedly ‘stable’ cryptocurrencies hit problems, confidence in the market plummeted. This in turn hit the NFT market, with trading volumes collapsing 97% in September from a peak in January 2022.
Although many publishers aren’t forthcoming with less positive updates about NFT and Web3 projects, the closure of CNN’s Vault by CNN – a marketplace selling collectible NFT ‘moments’ tied to major news events – is likely a good indicator of how others are faring. Crucially, this has raised issues of trust with audiences who believed NFT projects from publishers to be a safer bet than those touted by so-called ‘crypto bros’.
Facebook’s all-in bet on the metaverse certainly put AR and VR experiences at the top of the agenda for brands this year. Publishers have rightly been much more cautious, waiting to see a solid commercial proposition before jumping in. But some have taken the opportunity to experiment early, from Vogue’s Business and Yahoo Metaverse Experience to B2B magazines like Management Today. However, user numbers for even the most well-known metaverse platforms are still far below what is needed to justify longer-term plans.
It’s not all doom and gloom for emerging technology though. AI imagery and video has taken great leaps forward this year, with projects like Dall-E showing early promise to transform visual content creation. This tech may not be as sexy as the metaverse and Web3, but is more likely to make a tangible difference to how publishers work in the next few years.
Our guest expert this week is Simon Owens. Simon is a media industry journalist who edits an industry newsletter that covers everything from the Creator Economy to traditional media. He also hosts The Business of Content, a podcast about how publishers create, distribute, and monetise digital content.
Here are some highlights:
A year of contrasts in emerging technology
Esther: If you compare this year to last year, it’s been 24 months of huge contrasts. Last year there was an awful lot of excitement. Facebook decided it was going all-in on the metaverse, and subsequently there was this huge hype about it. There was a lot of experimentation in the NFT space, you saw lots of publishers launching things like Playboy’s Rabbitars, Forbes went and launched NFT characters.
This year, it all came crashing down. We’d always said there would be a period where everyone got really excited before reality kicked in. But I didn’t expect it to happen literally within 12 months.
For me, when we’ve been looking back and discussing some of the really exciting things happening for publishers, it’s all been the old media formats which have been exciting. It’s been newsletters, podcasts, things like Substack and blogs and how people are reformatting content on the internet. There’s been nothing exciting we’ve discussed in terms of VR, AR, the metaverse, or even cryptocurrencies. It’s been a really disappointing year [from the emerging tech perspective].
Peter: This has been a horrendous year for Big Tech. I saw a tweet that said there have been 120,000 layoffs [so far]. Compare that to the dot com collapse in 2000, and there were 107,000 layoffs, and we’re not even at the end of Q4. So that’s not good. It’s got to have an impact on that bleeding edge investment.
But here’s the silver lining. I think it might bring a sense of reality. There’ll be a focus on stuff that actually works, rather than the Ponzi scheme that was particularly driving crypto, but also NFTs. So I think that if reality bites that’s a good thing, because none of this is going to go away. But it’s got to get focused on real uses, rather than stupid fanboys with monkey NFTs.
Simon: This is a sign [publishers] should be exiting completely. It really showed that the emperor had no clothes, that all these things that were pitched about Web3 – that it will allow you to own your audience, that it’ll decentralise content distribution, that it will allow you to have more direct interaction with your audience – there really was nothing there.
Most of the things it claimed to do, Web2 was already doing it better and easier. I still have not seen any good use cases of Web3 that’s practical and scalable for publishers.
The fast mover advantage
Chris: There was definitely a first mover advantage when it came to NFTs for publishers. Last year we were talking about the astronomical sums people were paying for [The Economist’s] Alice in Wonderland cover. So there was genuinely a one-off opportunity there for them to generate some revenue.
I think that the smart money, such as there is in crypto, is talking about using NFTs as tokens to allow some functionality down the line. I was talking to Virtue, Vice’s agency, they were doing some work on behalf of Coke. They were saying if this is going to take off in a big way, it actually has to confer some benefit, like member-only access to a site using this token.
Simon: What you’re talking about is called utility within the Web3 world. But gating off access, that’s already done by Web2 much easier than having to learn how to buy Ethereum and then unlocking it using a crypto wallet and all that. It’s just Web2 with extra steps. You can gate content, you can have member-only communities that are based on subscriptions or memberships – all of this is much more efficient and easier technology to use than your standard Web3 platform.
Publishers in the metaverse
Esther: One of the things that’s become quite apparent this year is that a lot of the metaverse platforms are really struggling to [retain] users. Even some of the most popular ones have got something like 500,000 users a month, which is not a lot if you’re looking to spend six or seven figures building an experience for it.
Simon: So Facebook got renamed Meta, and then their main metaverse which is called Horizon [Worlds], actually lost users. So you have a $100 billion+ company that renames itself and says, we’re going all in on this new technology, then the core product within that technology actually lost users.
What does that say about the metaverse as a whole and its future? I think sometime in the future, depending on how far in the future we’re talking, maybe 20, 30 years, we will live in these virtual realities that extend far beyond just what you’re seeing from Roblox and Fortnite right now. But in terms of Facebook specifically, I think in terms of renaming itself, it really put the cart before the horse in terms of creating a product that people actually want to use.
Chris: I genuinely hope that we are wrong about this, because some of the VR and AR experiences I’ve seen – although we could talk about that as a separate thing that’s not necessarily the metaverse – from publishers have been amazing. I remember 6×9 by The Guardian, Hidden Cities from the FT. Some of the best citizen journalism I’ve seen over the past years has been delivered through 360 video, which is easily accessible through the Oculus. I would love there to be more of that.
This topic will be one of the chapters we explore in detail as part of our Media Moments 2022 report, launching on November 30th. Find out more and pre-register here to receive the report.
Republished with kind permission of Media Voices, a weekly look at all the news and views from across the media world.