Metaverse Could Contribute 5% to Latin America’s GDP By 2031

Bloomberg Línea — The Metaverse, which is now being seen as the future of the Internet, is generating ever greater expectations in terms of its global economic potential, with more and more companies entering the interconnected digital space to explore and move part of their business there, while the adoption rate grows among users.

The high demand for jobs generated by the new digital environment of an augmented, virtual and mixed reality, as well as the entry of different brands seeking to sell goods and services, blockchain systems and NFTs, have led a group of experts from consulting firm Analysis Group to calculate the economic impact that the virtual space will have in the coming years.

And the results of its research are positive if the implementation of this technology begins firmly in 2022 and continues with good adoption rates over the next 10 years.

For Latin America, the Metaverse could represent 5% of regional GDP in 2031, or some $320 billion; while globally the technology could contribute 2.8% to GDP, some $3.01 trillion.

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The Estimates

“Economic theories provide some insight into how new innovations can be expected to evolve and impact economies, but as with all innovation, it is impossible to predict all the areas in which Metaverse technologies will be used (...) In short, there is no ‘Metaverse’ to measure as of today,” the report states.

However, based on a parallel between the Metaverse and an existing technology that has had successful results, the consulting firm was able to come up with estimates of the contribution of the virtual world to the economies of each region of the world.

The researchers selected mobile technology as an “appropriate analog” because of similarities to the Metaverse in the way it combines “existing and emerging innovations” to fundamentally alter global technological and economic landscapes.

Thus, one of the best performing regions once virtual world implementation arrives will be the Middle East, North Africa and Turkey (MENAT), and India, with contributions to GDP in 2031 of $360,000 and $240,000, respectively.

To arrive at its estimates, the study team drew on publicly available data for mobile technology deployment and adoption over several years to assess the “direct, indirect and catalytic or stimulating impacts on factors important to GDP”, including job creation, business growth and economic development.

The Value of the Metaverse

Going forward, once the Metaverse is established and widespread globally, the study’s analysts project that its potential valuation or addressable market size could be between $3 billion and $30 billion, with a highly optimistic estimate of over $80 billion.

Currently, “analysts and industry observers have offered a wide range of estimates for the potential valuation or addressable market size of the Metaverse. Estimates range from around $800,000 to more than $2 trillion” in the near term, according to the analysis.

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For Analysis Group, this technology going forward has the potential not only to grow regions’ GDP, but to improve their productivity and employment levels, as well as improve consumer welfare across other dimensions.

“Over time, if the metaverse is successful, it is likely to displace some existing technologies and industries, as previous technologies have done before,” the study states.