top of page

The Metaverse is Built on the Ground

Are Data Centers Weapons of Mass Distinction in the Arms Race for the Metaverse?

Science fiction has played a non-trivial role in predicting if not inspiring the future of technology. Jules Verne, H.G. Wells and other before them foreshadowed the possibilities of science. While there were others before and many other after, the 3 seasons of Star Trek which ran from 1966 to 1969 envisioned many things we take for granted today. The communicator (cell phone), talking computers, tablets and many others and I would also say an early version of the Metaverse.

Most people agree that the term “metaverse” was coined by Neal Stephenson in the 1992 science fiction novel Snow Crash. The term is a blend of "meta" (self-reflective) and "universe." I remember becoming aware of the concept in the 1966 Star Trek double episode titled “The Menagerie.”

In those two-episodes (long story made short), Captain Kirk’s predecessor Captain Pike was taken to a planet where the alien inhabitants were able to provide the severely handicapped Captain Pike with the illusion of a normal like. While the science was glossed over, the technology provided for an incredibly sophisticated immersive version of augmented reality, where for all intents and purposes, Captain Pike was able to live an augmented reality life where he was eternally youthful and able-bodied.

Such is the promise of the Metaverse – a virtual world that will harness the power of virtual reality (VR), augmented reality (AR), artificial intelligence (AI), the internet of things (IoT), blockchain, cryptocurrencies and will allow users to interact in a digital world. Some sci-fi writers have envisioned the metaverse as a singular, 3D virtual world such as the one in Ready Player One or Snow Crash.

The metaverse’s potential is much more complex and exciting and will likely include a collection of different worlds. Perhaps one virtual world will be provided by Meta (formerly Facebook), another by Google and yet another by Microsoft (and so on). Nvidia Chief Executive Jensen Huang said he believes "There will probably be more virtual worlds than there are websites today.” The possibilities are virtually endless (pun intended).

Does the metaverse need a quantum leap in computing to become a reality?

While some of the cornerstone technologies necessary to bring the metaverse to life are already in place, we are still at the early stages of development. According to the team working on Meta’s version of the metaverse, “We’re only about one percent along on the journey.”

Consider the technologically required.

To deliver a truly immersive and synchronous experience where everything you see and hear let alone taste, touch and smell though your virtual self (avatar) seems real will take computing, storage and networking capabilities that are many times greater than where we are today.

We are talking about experiences where participants have an individual sense of presence, where they are in the experience and not just watching it. Where data is created, stored and secured on your, real and virtual identity, virtual possessions and entitlements as well as methods of communication and payments especially where participants pay real-world money for items that amount to little more than status symbols or rights within a virtual world.

Now compound the foregoing complexity by the virtually unlimited number of people, in vast geographies who will want to participate and where the experience is delivered in a smooth natural way.

Most industry participants struggle to be specific about the technological necessary to deliver the metaverse. Companies such as Intel are already pushing the outer limits of physics in producing the most advanced chips.

According to Raja Koduri, Senior Vice President at Intel, “truly persistent and immersive computing, at scale and accessible by billions of humans in real time, will require… a 1,000-times increase in computational efficiency from today’s state of the art.”

One thing is for sure and that is that the compute power required is beyond that which is provided by today’s massive data centers and blistering fast broadband networks.

Trillion-dollar story

But the size of the prize is enormous. The Metaverse may very well revolutionize how people socialize, how they transact business, how they share knowledge, how they travel, and much, much more.

And the reason for that is they are easier to build.

Morgan Stanley believes the metaverse represents an $8 trillion addressable market, and companies are scrambling to stake their claim. JPMorgan’s whitepaper on the metaverse, projects a myriad of companies that will leverage what people are increasingly referring to as Web3 to commercialize their work in novel ways.

Adidas, Atari, Gap, Hulu, Nike, Walmart, and Verizon were listed as early investors in the metaverse/blockchain economy. Other major players, such as McDonald’s and Samsung, have likewise fast-tracked their efforts to emulate Meta in the face of all the hype

Gaming – The First Frontier

The opening of every Star Trek episode started with “Space – the final frontier.” In the metaverse it could be “Gaming - the next frontier”.

Every day more than 3 billion gamers are active, using multiple devices across vast geographies. The immersive, graphics-heavy games use a massive amount of data. And if you think gaming is all for fun, the value of in-game purchases is estimated to surpass $70 billion a year by 2025.

At present, much of the data processing and storage for video games takes place on the end point devices in consoles such as Xbox or PlayStation. More and more the industry is moving gaming to the cloud where all the console processing and storage will transition into the cloud (aka data centers).

Cloud gaming will also introduce the possibility (or inevitability) of gamers being able to play across platforms whereas now, Microsoft, Sony and others maintain their own proprietary platforms. In a utopic metaverse world, you would be able to leave work in a Meta’s Workroom and go to a Travis Scott and Marshmello performance in Fortnite.

There are many technological and intercompany political barriers that need to be broken down preventing this ubiquitous intermingling of virtual worlds, but where there is demand so too comes the wherewithal to evolve.

Adoption of cloud gaming is expected to grow from 23.7 million paying users in 2021 to 60.7 million paying users in 2024. Current estimates of 20 gigabytes of data use per hour per hour will increase dramatically in the future the amount of information that’s being transferred when people are playing through the cloud; it’s a lot more than anything we’ve seen so far.

So, what does all this have to do with the metaverse?

As it turns out – a lot – maybe even everything! Cloud gaming and the infrastructure needed to support it is increasingly being seen as the ever-evolving foundation for the more robust networks, data centers and other technologies necessary to support an expanded metaverse – or without trying to overstate it - the future of the internet.

And gaming (especially online gaming) has other redeeming features relative to the advancement of the metaverse. Principal among them is an army of loyal and recurring gaming fans and existing revenue streams associated with virtual worlds and purchases. Gamers are loyal to their games of choice (content) and they are bound virtually by the community who are playing the games.

With Microsoft’s recent acquisition of ActivisionBlizzard it now has a vast library including Call of Duty, Candy Crush, and World of Warcraft. World class titles for sure, but it has also acquired access to, and likely influence over, the communities of gamers attached to those games.

One can only imagine that it is easily conceivable to migrate these loyal fans to new dimensions of an ever evolving metaverse.

This brings additional clarity to Microsoft’s strategy of linking its capital investments in gaming to its broader vision of an interactive internet. It also explains why gaming revenue accounts for such a small fraction of the overall revenue of the companies who are investing the most money building out cloud gaming infrastructure.

Only 13% of Microsoft’s overall revenue is attributable to gaming and the same figure for Meta is much smaller. Gaming investments are investment in today (gaming) and tomorrow (the metaverse).

The Next Frontiers – Space? – No, but pretty much everything else.

While gaming is an existing and natural next step to the metaverse there are many other use cases in varying stages of development moving towards an evolving Metaverse. Here are just a few:


  • Virtual experiences can leverage larger audiences and transcendent physics to create the next generation of entertainment. Concerts, Broadway shows, and tomorrow’s theme parks all things Walt Disney, Sony, and Warner Music are exploring.

Work & Workspaces

  • Employees virtually sitting in the same room can facilitate idea generation and execution. People attending virtual conference for the same reasons. Microsoft, Meta, Google (and many more) have made great strides in these areas.


  • The internet based on decentralized Blockchains using token-based economics for transactions.


  • Product marketing in one platform (i.e., a game) transports you to a virtual mall where you try on virtual cloths, order real ones and have them sent to you home. Ralph Lauren, Nike and others have been early movers.


  • Immersive, interactive learning experiences where students learn from the mode which is most effective.

The Virtual World is Real and Surreal at the Same Time

Given everything that we have just discussed, it should come as no surprise that the virtual world will be built on the ground. Cloud gaming and the metaverse it will beget will require data centers and digital infrastructure connecting them to advance.

Today’s internet is designed primarily for data traffic to flow one and that is toward the user. The interactive nature of games and ultimately the metaverse means two-way traffic that can easily overload the infrastructure that connects to large hyperscale data centers. Future networks will route traffic intelligently and determine whether the traffic stays local (at the endpoint), goes to one or more edge points or back to the core.

All this incremental compute and networking power means principally one thing - more data centers both at the hub and at the edge.

The companies best positioned to build and take advantage of the metaverse have scaled data center footprints with robust technologies and networks, rich content and intellectual capital and existing/growing audiences eager to evolve and spend as platforms evolve. Amazon, Apple, Google, Meta, Microsoft, and others already have billions invested in their data center fleets and future investment continues and is increasing.

This anticipated build-out of data centers and digital infrastructure, particularly at the edge make data centers weapons of mass distinction in the arms race for the metaverse.

To Infinity and Beyond

In a fully immersive metaverse, participants will be able to do almost anything they can imagine. This will dramatically affect how we live, work and play. Whether the final frontier of the metaverse will be real or forever remain science fiction remains to be seen.

But according to Elon Musk has mused that “dismissing the possibilities of an immersive internet (metaverse) may be akin to ignoring the power of the World Wide Web in 1995.” Companies of all stripes are figuring out their strategy for the metaverse. Some are early adopters, other late adopters some laggards.

Regardless, the need for computing and the critical facilities to house them will continue to increase. Companies with trillion-dollar valuations, headed by billionaires spending seemingly endless amounts of money, are bullish on the metaverse. That seems to lead to one immutable fact - this will all bode well for most virtually all aspects of the data center industry.

What is your organizations view of the metaverse?

For most clients we work for it involves the evaluation or evolution of a cloud strategy, the acquisition of colocation facilities, building new data centers or disposing of legacy ones.

Whatever your needs, we are here to help guide you on your journey to the metaverse. For more information on Cushman & Wakefield’s Global Data Center Advisory Group, contact us. 

136 views0 comments

Recent Posts

See All
bottom of page