by Mark Zuckerberg’s Metaverse (META) was supposed to introduce the metaverse to billions of users through the company’s Quest AR/VR headsets. Heck, Zuckerberg even changed the social media giant’s name to reflect his lofty aspirations of creating a series of permanently interconnected online lives.
But it’s looking more and more like Epic Games will be the company to really bring the metaverse. That’s even more likely after Disney ( DIS ) announced it’s investing $1.5 billion in the “Fortnite” game developer.
In the press release announcing the investment, Disney stopped short of referring to the market as a means of bringing life to life, saying, “The enduring new universe will provide consumers with countless opportunities to play, watch, shop and engage. with content, characters and stories from Disney, Pixar, Marvel, Star Wars, Avatar and more.”
If that’s not some kind of metaverse I don’t know what is. That’s especially true since the “persistent universe” will be run through “Fortnite,” the popular competitive online shooter and building game.
“Fortnite” already has online concerts, and recently introduced a Lego “Fortnite” game, a racing game, and a music-based game.
Meta, meanwhile, is continuing to invest in the metaverse, with Zuckerberg calling out the technology during the company’s latest earnings call, but it appears to be taking a backseat to artificial intelligence. In fact, the CEO dedicated most of his prepared remarks during the call to AI Meta investments.
Yes, he mentioned that the company’s Reality Labs segment saw $1 billion in revenue in the quarter and that its Horizon app is among the top 10 most used apps for Quest. But he also sprinkled a lot of AI talk into his metaverse bit, saying that the company’s Ray-Ban Meta smart glasses offer a better experience thanks to Meta AI and that the glasses are a way for humans to interact with AI.
In other words, it sure looks like Epic Meta hit the metaverse to the punch. And the gap is likely to widen from here.
‘Fortnite’ has been on the rise for years
Epic CEO Tim Sweeney is a metaverse believer. In May 2023, when Business Insider published an article stating that the metaverse would join the list of failed fads in the tech industry, Sweeney tweeted that answer calling jokingly for online listening so “600,000,000 monthly active users in Fortnite, Minecraft, Roblox, PUBG Mobile, Sandbox, and VRChat can mourn their deaths together in real-time 3D.”
Sweeney is right that millions still play games like “Fortnite,” “Minecraft,” and “Roblox,” but the metaverse concept has lost a lot of steam. Companies from Microsoft to, yes, Disney ended their metaverse projects as AI took over the technology to advance the industry.
But Epic and Meta kept charging forward. While Meta poured billions into its Quest products, Epic added characters and intellectual property from the likes of Marvel, “Dragon Ball Z,” “Naruto,” “Halo,” “John Wick,” and “Stranger Things” to ” Fortnite .”
However, Meta has struggled to get consumers to adopt its Horizon Worlds app. In 2022, the Wall Street Journal reported that the app fell far short of its goal of hitting 500,000 users per month, reaching less than 200,000 instead. The company revamped the app in 2023 with hopes of adding more games.
Meanwhile, Epic announced a trio of games in December including “Lego Fortnite,” an open-world survival game where players build things out of Lego bricks; “Fortnite rocket racing;” and “Fortnite Festival.” Each game allows you to bring your “Fortnite” character skins, and in-game clothing, creating a seamless set of lives for your “Fortnite” avatar.
Adding Disney and its various characters and unique logos to the “Fortnite” formula should help keep players coming back to Epic’s interconnected collection of online games.
It’s important to point out that Epic and Meta aren’t the only companies building out their respective metaverses. Roblox (RBLX) also continues to build its concept of the metro. In its most recent quarterly earnings report, the company announced that it achieved $1 billion in bookings.
It is also worth noting that Zuckerberg apparently refuses to give up on the metaverse. This despite the company losing $16.1 billion on the effort in 2023 alone. That’s up from $13.7 billion in 2022.
Part of Meta’s problem is that its metaverse very much requires users to jump in via its Quest line of headphones. The company launched a Horizon Worlds mobile app to lower the barrier to entry, but it doesn’t have the appeal of “Fortnite” to offer.
Zuckerberg also faces increased competition in the headset space from Apple’s new Vision Pro. On Tuesday, he posted on Instagram Reels, saying that after using the Vision Pro he believes that the Quest 3 is the overall better product, not just the cheaper option.
But it will take more to get people to pony up and stick with the Quiz on the Vision Pro.
Still, the tech and gaming industries are elusive. With Zuckerberg determined to make his vision of the metaverse a reality, it could pay off in the long run. For now, though, “Fortnite” is eating its lunch.
Daniel Hawley He is the technology editor at Yahoo Finance. He has been covering the tech industry since 2011. You can follow him on Twitter @Daniel Howley.
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