Described as new social networks, Chinese metaverses face an uphill battle to replace traditional social platforms

Multinational tech giants like Meta and Microsoft have invested millions of dollars in developing new technologies for metaverses, laying the groundwork for people to interact with each other in virtual environments with ever-increasing frequency. elevated, moving more of our lives online.

The concept has also caught on in China. Framed as the next phase of social media, these metaverse apps have attracted large user bases, and retail investors have bought the shares of public companies that claim to create new games and apps in this format.

The general direction of metaverses in China has not been set by their developers, and regulations that apply to other industries, such as video games, impact their design.

keep it casual

Metaverses developed for users in China are often constructed differently from those overseas. While apps like Decentraland and The Sandbox take up a page of Roblox to encourage users to create wearables, structures, and other items from scratch, Chinese metaverses typically require users to log in, select a wardrobe, and then interact with each other. Mini-games, such as small-scale role-playing games, can be integrated, but the main function is to connect people with each other in a game-like environment, shifting interactions from text-based chats to moving graphics.

One example is Oasis, a metaverse platform where users can socialize and visit virtual cinemas, karaoke bars, and amusement parks. The developer behind Oasis, Shanghai Wei’er Network Technology Co., closed its Series B round to land an eight-figure US dollar investment this month. According to data compiled by Sensor Tower, Oasis gained over 6 million registered users in the fourth quarter of 2021 and has become one of the fastest growing metaverse-related social apps in the world. It claims to have nearly one million daily active users.

The sense of novelty offered by Oasis to its users, who are mostly Gen Z, is also present in Jelly, another self-proclaimed social networking metaverse app. In its heyday, Jelly replaced WeChat to become the most popular free app in Apple’s App Store in China, its popularity (before it went offline) resulting from cute designs and updating. provision of a space where users can separate their privacy from public images.

Metaverse apps like Oasis and Jelly have been successful in capturing the attention of younger users, but it’s unclear at this time if they’ll be able to scale and adapt to prevent users from defecting to the next new one. virtual world.

This is where the differences between metaverses in China and the rest of the world matter the most. By emphasizing ownership of virtual goods, companies like Decentraland and The Sandbox are able to retain their users because there is a financial incentive to stay in their world. These economic structures are often built using non-fungible tokens and cryptocurrencies, which cannot be used in this way in China.

This leaves Chinese metaverses in a tricky position. If users are not financially motivated to stay in metaverse worlds, and if these digital environments cannot develop additional video game elements due to game time caps for underage users, the use cases for Chinese metaverses will be limited.

Mixed signals from government officials

Since October 2021, when Facebook was rebranded as Meta, some Chinese officials have publicly endorsed the development of metaverses. This direction has found its way into the industrial development policies of local governments in Shanghai, Beijing, Shenzhen and other cities. The sentiment may reflect a desire to be home bases for the next big tech companies, where innovative small and medium-sized companies grow to become powerhouses. In particular, Shanghai officials are actively courting this type of business.

However, domestically, metaverse developers have yet to receive a nod. In January, the State Council released its 14th five-year plan, which charted the course for building a robust digital economy in China. The document said the nation will “accelerate the construction of a digital China” between 2021 and 2025, with the aim of developing the country’s digital economy and becoming a cyber superpower. However, there was no explicit mention of metaverses and the wider implications of their development.

Besides Oasis and Jelly, big tech companies like ByteDance and Baidu have also created their own metaverse apps. All of these platforms, whether designed to be social networks, mini-game environments or meeting places for professional use, will likely face additional regulatory hurdles. In particular, video games, which are considered an entry point for metaverses, are strictly regulated in China, which hinders the overall development of the country’s local virtual environments.

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