Metaverse and web3: Finding your opportunities: PwC

The metaverse has attracted both a lot of attention and a lot of skepticism. But first, what is the metaverse? What are the possible risks, how does it connect to web3 and how can businesses build trust into their metaverse activities from the start?

In this episode, Roberto Hernandez, PwC’s Global Metaverse Leader and US Customer Strategy & Experience Leader, is joined by Chris Duffey, Head of AI Innovation and Strategy for Adobe, at PwC’s Emerging Tech Exchange. Listen as they discuss these questions and the current and future impact of these emerging technologies on the business landscape.

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About the podcast participants

Roberto Hernandez is a Principal in PwC’s Consumer Finance practice. He has extensive experience in advising banking and lending clients on customer experience, strategy, operations , risk management, process improvement, and consumer compliance. Roberto has over 17 years experience in the financial services industry in both a consulting capacity and also working for two of the top 10 global financial institutions. Roberto is a frequent speaker at industry conferences and the author of several news articles as well as whitepapers on the topics of customer experience, operational strategy, regulatory compliance response, and target operating model design. He is also the author of both the Consumer Lending and Mortgage ‘Customer Experience Radars’.

Chris Duffey spearheads Adobe’s strategic development design partnerships across the creative enterprise space.

Chris’ keynotes have received over 50 million impressions and his work has been featured by more than 100 global media outlets on topics including the Metaverse, Web3, NFTs, DAOs, generative experience design, computational creativity, the role of human + machine, and AI-enhanced creativity.

Chris is the author of the award-winning book Superhuman Innovation, the world’s first book co-authored by AI about AI. And has written the forthcoming book Decoding the Metaverse: Expand Your Business Using Web3.

Episode transcript

Find episode transcript below.

ANNOUNCER:

00:00:01:00 Welcome to PwC Pulse a podcast to provide insights to help you solve today's business challenges.

ROBERTO HERNANDEZ:

00:00:11:19 Hi everyone, I'm Roberto Hernandez, PwC’s Customer Experience Leader and Global Metaverse Leader. I'm very excited today to be here at Emerging Tech Exchange with our guest, Chris Duffey.

00:00:22:19 Chris is a head of AI Innovation and Strategy at Adobe and he also leads Creative Cloud Enterprise for the company. Relevant to the discussion today, he is the author of a brand new book called Decoding The Metaverse Expand Your Business Using Web3.

00:00:40:08 There's a lot of value that organizations, big and small, are expecting from the intersection of the Metaverse, Artificial intelligence, blockchain, and Web3. So, Chris, welcome to the podcast.

CHRIS DUFFEY:

00:00:54:11 Great to be here. Thanks for having me.

ROBERTO HERNANDEZ:

00:00:56:11 So we are going to start with what we call the rapid fire questions. Chris, just to break the ice a little bit, so what is your favorite city in the world to visit?

CHRIS DUFFEY:

00:01:06:22 Great question. We recently moved to Miami, so not only visit but live in quite excited to be in Miami. Now, the energy there has been really reinvigorating for me just from a lifestyle standpoint, but also there is a great web3 community down there, so quite excited about that.

00:01:26:22 Additionally, really loving the South America and Central America vibe, the innovation coming out of countries like Brazil and Uruguay and Peru and Mexico and Central America is just really exciting to see everything from the tech, to the manufacturing, to the shipping and the creativity is really quite inspiring, so.

ROBERTO HERNANDEZ:

00:01:49:13 You're not seeing that because you're speaking to a Mexican in your half Mexican, right?

CHRIS DUFFEY:

00:01:56:23 Yeah, it might influence a little.

ROBERTO HERNANDEZ:

00:01:58:21 Now, the next rapid fire question is what is a book you would recommend? And you cannot recommend your own book that you just published.

CHRIS DUFFEY:

00:02:07:08 Yes. A little biased, but any book on emerging tech, I think is really almost an obligation at this point. Things are moving so quickly.

00:02:16:08 I really think it's incumbent on us both on a personal and professional level, to really understand not only the technical capabilities, but the implications of those technology use. There's that old phrase with great power comes great responsibility.

00:02:31:18 So I really think it's a responsibility at this point to know the tech and then be really ethical in using the tech.

ROBERTO HERNANDEZ:

00:02:39:19 Excellent. And last rapid fire question, who is your inspiration?

CHRIS DUFFEY:

00:02:43:18 So many throughout the years? But I think it probably comes back to my father. He was a reading specialist, and growing up I was very much into design. But he really instilled in me the beauty of lifelong learning. And I think that's really stuck with me and I think a great trait to have.

ROBERTO HERNANDEZ:

00:03:02:23 Well, thank you very much for sharing all of this with us. Now we are going to get to our main topic, the metaverse. I think that our listeners would really like to know more about your journey into the metaverse.

00:03:16:23 I remember meeting you a few months ago and we started having a fantastic dialogue on this topic. But then you also mentioned how you had previously released a book on artificial intelligence that you actually co-wrote with an artificial intelligence engine.

00:03:31:05 You have been working with Adobe on the AI space for a number of years. So what has made you so excited about the metaverse and what we are seeing these days related to this topic?

CHRIS DUFFEY:

00:03:43:04 Sure. I think that's an accurate way to phrase it, a journey. It really has been a bit of a winding journey and I bring it back to my childhood. I grew up in a multicultural home. My father was Irish, my mother was Mexican. Not until later on in life did I realize that really instilled in me this affinity for unexpected things to come together.

00:04:04:07 The power of connecting the dots. In many ways art in science, creativity and technology, and now the fusion of both the physical and the digital world is quite exciting. That is a core principle that has stood with me throughout time.

00:04:21:07 During my early career, I was a content creator and really I think went where the attention was. Knowingly or unknowingly at that time, and every medium had its moments.

00:04:32:12 We had the radio revolution, then the TV, then the mobile, the web and so on. And I think I kind of just went on that journey along the way. About mid-2000, I started focusing very heavily in health care, and that was a really interesting intersection of creativity, the need for creativity, innovation, but also the ingestion of data.

00:04:59:00 And with so much data in the health care space, we quickly saw the opportunities of artificial intelligence to help inform better diagnoses, and that data could really help physicians better assess the symptoms. Fast forward a few years.

00:05:15:00 We started introducing emerging technologies such as augmented reality and wearables to augment and amplify that data intake, but also data understanding.

00:05:26:18 At Adobe, I've been heavily focused on how can we create an end to end tech stack platform that really helps companies to create these better experiences. And Roberto, to use your phrase, to stretch the experience, I love that. I think it's really accurate.

00:05:45:18 It's not just about one moment in time. It's about creating this synergy of moments in time. So I think the tech stack is now the table stakes.

ROBERTO HERNANDEZ:

00:05:54:15 So you talked about a journey and you were talking about radio, TV, web and we are now talking about the metaverse. So the first part of my question would be, do you fundamentally believe that the metaverse is really going to be the next big medium and that is going to eventually replace what we know as Web or web to the (Unintel Phrase)____6.15, today?

00:06:14:14 The second part of my question is you mention same thing, radio, TV, web, that is all about storytelling, all about the delivery of content. But then you also talked about health care. How do I connect those two and maybe bring into your definition of what is the metaverse, given that we are talking about two very different things.

CHRIS DUFFEY:

00:06:37:03 At Adobe these past six years, I like to say I'm in a very privileged position where I get to speak with fascinating folks like yourself all day, every day, and I get to see patterns starting to emerge.

00:06:49:03 In about four years ago this term, the metaverse started popping up in conversations, and I think everyone had a slightly different interpretation of the metaverse, even three or four years ago.

00:07:00:12 And so I felt it was almost an obligation to really dig deep into what the metaverse was and can be. And what I quickly saw was there was a lot of misunderstanding on the delineation between the metaverse and Web3.

00:07:17:12 And so now we can go down a bit of a rabbit hole with Web3. But first, maybe the metaverse, and I like to almost describe the metaverse verse, define the metaverse because it's evolving so quickly.

00:07:29:06 Let's not get bogged down into semantics of a definition. Rather, at a very simple conceptual level, the metaverse is the fusion of the cyber world. With the physical world, I think everyone can universally agree on that.

00:07:45:12 When we get into more detail, that's where, you know, it gets very almost religious or very philosophical. There are some emerging agreeance on the characteristics, the core characteristics of the metaverse, and I like to think of those in seven ways.

00:08:02:07 The first one being immersive 3D, the second being real time, the third being ownership, fourth being interoperable, first shared experience, sixth shared economy and the seventh persistence.

00:08:18:07 So those are all of the core characteristics of the metaverse. And I will set a strong caveat that some people will now start to use some of those as a lens to say this is or is not the metaverse I would offer.

00:08:32:08 Let's use those as guideposts and not get too strict on does something have to have all seven or so?

ROBERTO HERNANDEZ:

00:08:38:07 Excellent. So now talk to us a little bit about the metaverse today versus what you expect the metaverse to look like five years from now?

CHRIS DUFFEY:

00:08:47:23 It is fascinating to see the level of creativity that is being unleashed in the metaverse currently, and I can only imagine what it will be in the next 2024 months or so. There's some core principles, and these are getting somewhat pulled from Web3 about this shared opportunity, this sharing of value within the experience. And that is, I think, a fundamental principle going forward that is a big mind shift for businesses.

00:09:18:05 It's a complete almost flipping of the script, if you will, in terms of how do we create utility and value going into the metaverse. Quite often we used to think as a company, how can I extract and monetize people's time and attention? And actually it's going to be the inverse of that. It's going to be how can I reward their time and attention going forward?

00:09:41:14 Another core principle will be how can we co-create together, which is somewhat of a scary proposition for businesses to give up some ownership of the brand to their audience.

ROBERTO HERNANDEZ:

00:09:54:05 And seizing control of that brand to some extent. Right?

CHRIS DUFFEY:

00:09:57:15 But have seen some really interesting use cases of the power of fandom. So when people feel invested in a brand or a product or a service that creates this notion of fandom that will really create loyalty going forward, nobody can honestly predict five years out what the metaverse will look like. But I think some of those universal principles will be even more so amplified going forward.

ROBERTO HERNANDEZ:

00:10:22:13 So we have talked over the past few minutes about the experience, storytelling, the consumer side of the metaverse. But at PwC we just published are Metaverse predictions for 2023.

00:10:35:13 And one of our predictions was that it will be businesses, not consumers or the videogame aficionados, the ones that are going to take the lead position in driving adoption of what we believe is going to be an explosion of metaverse experiences and use cases. Do you agree or disagree?

CHRIS DUFFEY:

00:10:53:14 We couldn't agree more. I think we're at a interesting inflection point where almost like electricity, the light bulb has been invented and now we're building out the infrastructure or the ecosystem to enable that light bulb.

00:11:10:14 And so that is where B2B and enterprises really come into play, where we're starting to build out these different platforms within the metaverse. I take somewhat of a strict stance on there is one metaverse with multiple worlds in it, and that is where the metaverse will be really amplified through B2B innovation going forward.

00:11:30:12 I think one of the big opportunities and challenges currently is the interoperability between these worlds, and that is where there's great opportunity for businesses to unite and start to connect on standards to help with that interoperability.

ROBERTO HERNANDEZ:

00:11:46:18 One of the questions that our clients frequently ask us Chris is where should I get started? So in your opinion, what is the best way to get started in anything related to the metaverse?

00:12:00:18 And I'm not talking so much about what a lot of companies are already doing that relates to proofs of concept or getting people trained on the basics of what the metaverse is that don't really delivering return on the investment.

00:12:13:17 What are your thoughts on that and what are the industries that you perhaps see as the ones that are going to be at the leading edge of being able to monetize on what you are defining as a metaverse?

CHRIS DUFFEY:

00:12:24:00 It's a great question. Honestly, my thinking on this has evolved over the last couple of years. To your earlier point about artificial intelligence and the convergence of AI and the Metaverse, I think we can see a very similar adoption cycle that we saw with AI, with the metaverse as well.

00:12:44:00 With artificial intelligence, there's been some winters and summers throughout the years, and I think we're going to go through a similar lifecycle with the metaverse.

00:12:53:11 Early on in my world of AI, about ten years ago, I was an advocate for get under the hood and learn the technology. I've evolved that thinking to now understand the core capabilities that this solution can offer.

00:13:10:11 This being the metaverse, start with those characteristics and start to infuse those into current projects. And I think that will help with that mind shift. Going back to that earlier point on, it's not about monetizing people's time, it's about rewarding them.

00:13:25:06 Take a current Web2 use case and see how that can be infused into that project and then expand out from there versus starting almost a digital center of excellence or a metaverse center of excellence. I think the better use cases probably start infusing characteristics of the metaverse going forward.

ROBERTO HERNANDEZ:

00:13:44:13 Excellent. So you have talked about artificial intelligence a couple of times during our discussion, and it would be a mistake on my part if I didn't bring generative AI into this dialogue.

00:13:58:13 Given the potential that we believe exist on connecting the dots on all of these incredible experiences that we are starting to see related to the metaverse and how some of these could be connected to generative AI.

00:14:09:03 So how do you think that generative AI is going to impact the metaverse? So we're going to see an acceleration, is it going to become another shiny object that is going to move us away from what we are talking about today?

CHRIS DUFFEY:

00:14:22:13 I couldn't be more excited about Gen Tech Generative AI. In the early days of modern day AI, it was still very much a narrow AI focus in that primarily was a use case of extracting patterns from large datasets, and that had interesting implications, but nothing, I think, groundbreaking.

00:14:45:13 With Gen AI, I think what you just brought up is it's even taken it a step further from democratizing, content creation and expression, but has become more inclusive.

00:14:55:19 Anyone at anytime, anywhere will now be able to express themselves across any medium and is quite empowering proposition for Gen AI going forward. At Adobe, we're thinking about four use cases, the first one being text generation, the second one being video generation, third being image and the fourth being 3D generation.

00:15:22:19 With that capability, we can now infuse those outputs into the metaverse for better 1 to 1 personalization real time on a persistent level and that gets infinitely complex but infinitely exciting.

ROBERTO HERNANDEZ:

00:15:37:13 Chris, let me now go into another area that is incredibly important. We have been talking a lot about storytelling, stretching the experience, how exciting this topic is, but what about the risks?

00:15:51:13 And more importantly, what about the trust that organizations, big and small need to convey to the consumers, employees, stakeholders need to have on these metaverse experiences?

00:16:05:13 Are we prepared for what is going to be an amazing wave of new activations that are going to be very visual and that are going to touch pretty much every single company in every single industry.

CHRIS DUFFEY:

00:16:17:19 I think it's a fundamental pillar that has to be addressed for future success of the metaverse. Essentially, it comes down to the security, the ethics and the privacy, not only of the individual platforms, but this universal agreement within the metaverse.

00:16:35:19 And that touches upon some of the core principles of Web3, as well as Web2 and the metaverse. It's not an easy task by any means, but I think it's a very important one that we have to continue to have a societal open conversation about the implications going forward.

ROBERTO HERNANDEZ:

00:16:53:11 So you would say that dialogue is important and that we don't need to wait for regulators to tell us what to do, but that we need to have some self-guiding principles.

CHRIS DUFFEY:

00:17:03:19 I completely agree. I think it's probably a combination of both the private sector and the government regulation in parallel.

ROBERTO HERNANDEZ:

00:17:12:16 So, one more question. Let's assume that budget was not an issue Chris, which would be the type of metaverse activation that you would start investing in right now and in what industry?

CHRIS DUFFEY:

00:17:28:08 Something we were chatting on earlier is I think this notion of shared ownership is quite powerful from all angles, from a platform angle, from a business angle from individual content creator angle to get into the technicalities.

00:17:47:08 This idea of having a wallet or what's emerging as a personal online data vault that can travel with the user as they are journeying through the metaverse can be quite powerful.

00:18:02:01 There's also the use cases of NFTs has evolved greatly even over the last 24 months, where it first started out as a digital piece of art, almost as an investment opportunity or vehicle, and it has now greatly evolved to almost a loyalty club.

ROBERTO HERNANDEZ:

00:18:20:23 Chris you and I could talk for hours, if not days, about this topic. Thank you so much for sharing your insights with us today and once again, congratulations on your new book.

CHRIS DUFFEY:

00:18:31:18 Thank you.

ROBERTO HERNANDEZ:

00:18:32:13 And to our listeners, thank you for joining us on this episode of PwC Pulse. We'd love to hear your thoughts about today's conversation. You can leave a review on your favorite podcast platform.

ANNOUNCER:

00:18:44:14 Thank you for joining us on the PwC Pulse podcast. Subscribe to PwC Pulse wherever you listen to your podcast or visit PwC.com/Pulsepodcast to hear our next episodes.

ANNOUNCER:

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