Transcript – How Brands Should be Utilizing Web3 and the Metaverse (Part III)
“RS: It provides a foreshadowing of what I'm seeing in the marketplace today, as we look at Web 3.0, the metaverse blockchain, and I’ll say the new community ecosystem that we're entering into is, we all have great confidence that it's going to be a big thing. We're obviously entering it and people are investing billions of dollars right now and hundreds of billions of dollars to make sure that we have a strategy, that companies have a strategy for Web 3.0 and the metaverse. But to be clear, there's still a lot of unknowns.
[00:00:36] MM: Veritone presents Adventures in AI, the podcast that dives into the many ways artificial intelligence is shaping our future for the better. I'm your host, Magen Mintchev and this is the third part of the metaverse series here on Adventures in AI.
Today, I am speaking with Ryan Steelberg. He is Veritone’s Co-Founder and President. Ryan has previously served as president and CEO of Brand Affinity Technologies, as the Head of the Offline Division at Google, and was the Co-Founder and President of dMarc Broadcasting, which was an advertising company that was acquired by Google in 2006.
[00:01:10] MM: Ryan, it's great to have you back on the podcast.
[00:01:13] RS: Thank you, Magen. It's good to be back.
[00:01:15] MM: Awesome. So, let's go ahead and get this started. As I said, this is the third part of our metaverse series. And in previous episodes, I had the great opportunity to speak with two other highly influential people in the space, Jon Radoff and Theo Priestley. Now, as a well-established media, sports entertainment, and technology influencer leader, I'd like to focus on the landscape and predictions conversation with you, Ryan. So, with that being said, what do you think is the landscape and predictions on metaverse and Web 3.0?
[00:01:47] RS: Well, I think the only thing we can all agree on is that it's going to be big, it's going to be disruptive, and I do believe that it's going to impact every business and every individual both directly and indirectly. I say that high-level vague, because it reminds me so much of the early days of the world wide web back in the mid-90s, where this new interconnected world was being thrust upon us, very few consumers knew about it. But a lot of businesses were hearing about the world wide web and the vision and opportunity to seamlessly and continuously be able to communicate to other partners, other consumers.
So, it was like a mad gold rush of everybody trying to figure out their strategy and sticking their claim in the worldwide web. Obviously, as we've gone through the millennium, and the 2000s, and the dot com, and dot com boom and bust phase, the end result was everybody was correct. The world wide web and the Internet was a big thing and it turned out today that there's probably not a single area of our existence that is not somehow directly impacted by the world wide web and the Internet.
But the clear roadmap when we were entering that phase, it was, I would say a murky map at best. So, it reminds me a lot frankly, of taking that as a parallel of what's happened in the past. It provides a foreshadowing of what I'm seeing in the marketplace today as we look at Web 3.0, the metaverse, blockchain and I’ll say, the new community ecosystem that we're entering into is we all have great confidence that it's going to be a big thing. We're obviously entering it and people are investing billions of dollars right now and hundreds of billions of dollars to make sure that we have a strategy, that companies have a strategy for Web 3.0 and the metaverse. But to be clear, there's still a lot of unknowns, and I think that's the biggest thing that we are really focusing on is what is a disciplined pragmatic approach to entering and servicing our clients as relates to Web 3.0 and the metaverse.
[00:03:57] MM: Yeah, and to actually go a little bit deeper on the unknown. So, if influencers, content, and IP owners and brands are driving the engagement within the metaverse, what are some best practices you would give them guidance on like brand continuity or identity management?
[00:04:14] RS: I think the most important thing is stay focused as it relates to your community and your audience. Many of these influencers and we've talked to hundreds of influencer partners, and remember Veritone, for those who don't know, we have a pretty large business of interacting and trading with digital influencers. We’re one of the largest advertisement investment companies that sponsor a lot of the creative channels, those are TikTok channels, YouTubers, et cetera.
What's interesting in those discussions, and again, to be very specific, well over a hundred conversations with some of the larger partners that we work with, many of them have no idea really what the metaverse is, as it relates to their business. When we say it's been driven by the crater economy and community et cetera, that is very accurate to a point. But some of the biggest YouTube stars you know, have really very little understanding of what Web 3.0, what the metaverse looks like.
So, if that's the case, I think it's imperative upon everybody to take again, a very disciplined pragmatic approach as relates to it. A part of that is, groups can't afford not to start investing a little bit, and trying to understand if nothing else, what does this all mean, right? What does my coexistence in the metaverse for my brand mean? But I think the true north that a lot of these influencers are going to stay in that category for a second is, number one, community first. Do not forget your current and existing audience. This is the same group, mind you that has made them stars with tens of millions of subscribers and fans. Don't alienate them.
When you're thinking about your metaverse strategy and your Web 3.0 strategy, you need to think about your community first, right? What is your position in the metaverse? And how is that going to extend and expand your current community and not alienate it, or think that that you're just going to start to create a brand-new community?
I think again, number one is stay focused on your community, and that requires all of the same attributes that many creators are good at is keeping an authentic and relationship with their audience, with their communities, with high integrity. The second thing I would say is, make sure they protect their brand, right? Ownership, and just like the early days of the web, people are misappropriating content, and identities every single day in the metaverse. This has been a problem obviously, it's been going on since the creator community really emerged with YouTube. But it's imperative that creators have clear understandings of what they own and their content and making sure it's protected. We're reading a lot about this with NFT marketplaces and other things today is that 80% of the listings on open sea are built around copywritten material, meaning they're being ripped off. People are literally building NFTs whether they're imagery or video objects or new creations, and they're misappropriating IP copyright that's owned by somebody else.
That ties into the second pillar, which I mentioned is make sure you have a clear understanding of brand integrity, and brand ownership and IP ownership as you enter into the metaverse play. So, take care of community, number one, and number two, take care of your IP and your brand.
[00:07:37] MM: Love it. Great points. Definitely. What about large enterprises? Can we talk about the opportunities of enterprises being in the metaverse? So, what are the benefits? What kind of doors will this open for companies?
[00:07:49] RS: Yep, I think businesses have their own audience as well. They may be different. They may be customers and buyers, right? And it depends. So, I think a lot of the same tenets still apply. What is your audience, right? In your current Web 2.0 ecosystem and even Web 1.0 ecosystem, how are brands, how are enterprises leveraging those technologies, leveraging the traditional Web 2.0, and the world wide web and the Internet to service their customers?
The Web 3.0 strategy should be an extension of that. I think the biggest difference for enterprises is the community itself is a much more active player. It's not just them preaching and advertising to potential customers and an audience. But they have to understand that really, Web 3.0 is about community, right? It's taking interactivity, and opening up communication line with your customer base, with your audience to a whole another level. A lot of enterprises aren't necessarily prepared for that. I think that's something that the creator community has had a distinct advantage over enterprises, because that's their entire growth of their platform for these creators and individuals has been about building audiences, about engaging and activating communities. So, I think enterprises need to understand that as well.
The opportunities are endless. Again, it's just setting expectations. Enterprises need to have exposure, they need to test things, they need to try things. But they have to be realistic. They're going to have a lot of trial and errors. They're going to make mistakes. Should I've set up a storefront and try to start literally selling things? If I'm a recruiting company, do I want to set up recruiting fairs and job fairs inside the metaverse? The answer to all these things are yes, yes, yes, yes. Test, test, test, but be disciplined, be controlled, make sure you can get out.
Enterprises, they need to have a clear understanding of the risks that they want to take when they are entering and trying out, and testing and innovating in the metaverse, and they need to be prepared to get out, or very quickly make changes to their strategy. Again, I strongly encourage every enterprise to make the investments to start exploring, to start testing, to get exposure, but again, be nimble, and be prepared to shift your strategy quickly.
[00:10:09] MM: Makes absolutely sense. I feel like it's just, like you said, the opportunities are endless, and the best way to know is to just go for it. That's how you learn. What do you consider digitally immersive? And do you think that we're already there?
[00:10:25] RS: I think there's aspects of where we're already there. I think the gaming community is simply by the nature of these 3D immersive worlds, that you can enter, either through a PC or an app on your phone that has a 3D based environment, like so many of these very popular video games provide, is absolutely part of the metaverse, right? That is the entry point. I've always described the metaverse as just a different level of immersion. You can choose to take that same videogame experience and put on your VR headset and enter it, meaning you're activating more of your senses. So, you're more immersed in the 3D world.
But again, I don't minimize at all those who simply choose to enter and experience the 3D worlds through their phone or looking at their screen without the headset. I look at it as kind of a continuum where just the level of immersion. And there's arguments, and I actually believe that I'm in the metaverse right now, on a very limited basis. Even on this call with you, right? You and I are having a discussion through an IP based interface, building this podcast. So, in that instance, it's not full immersion by no sense. But you and I, in any time, in the same conversation can choose to put on our VR headsets, and then we could start interacting through our avatars.
So, the point is, is that a completely new experience? Not necessarily. So, we look at it is and we really try to educate our constituent digital influencer clients and content partners, is you need to think of the full spectrum. Those individuals who want to interface and engage with your brand, or with you, in a completely asynchronous thing, meaning I just want to be able to communicate on my phone through discord. But be prepared, if larger percentage of your community and your audience or your customers want to go full immersion, you need to be prepared for that. What's the difference when Ryan Steelberg chooses to put on my headphones and go into the complete 3D immersive world where more of my senses are fully saturated? And what would be the different experience that I'm going to have with that brand or that enterprise?
So again, yes, I do believe all of us have been in the metaverse now for quite some time, really highlighted and built out by the smartphone. But now we're just entering another phase or a more comprehensive level of immersion through these pervasive 3D worlds with the option to go, I'd say, complete submersion and immersion with VR headsets, Oculus Rift and others.
[00:12:58] MM: What do you see being the next trend in immersive engagement? Do you think it's dating? Do you think it's shopping or music? I mean, we've already got TV shows that have avatars. So, what do you think that next big thing will be?
[00:13:13] RS: I think we're going to see a lot of the Web 2.0 opportunities be introduced and tried, and any other proven to be valid, or debunked in Web 3.0. Dating? Absolutely. Some of the most primal things that us as humans, always trying to strive for community, communication, obviously, dating and intimacy, whether that's in real life, human being, or through digital avatar, that's something that everybody craves and I think that's going to be in high demand.
So, you're going to see a lot of different new derivatives of dating. What's interesting about it, is if you look at the kind of the match.com, and the Tinder ecosystem, part of that opportunity, historically, is you create a listing of yourself, and obviously, they use AI and different technology to try to match you up with somebody else. You can look at photos of somebody else, right? I make a decision, pretty superficially, is I can make a decision whether I want to take it to the next step with that potential individual, or I can swipe down or left or whatever.
The metaverse and the 3D world absolutely allows you to extend that courtship, that initial dating opportunity even deeper, but it's interesting is you're going to have even more opportunity to present yourself on how you want to present yourself. A lot of people complain, like, “Wow, I finally met that person on that date that I met on Tinder and they look nothing like their photo or they doctored up.” Well, that's going to be a whole another extreme level, as you can imagine, where I can choose any type of Avatar I want. I think the issue with the 3D worlds, which is also the opportunity is the form of expression is going to be extreme. People are going to be able to not be bound by their pure physical being of how they are in real life, and they may want to express themselves and present themselves through a different type of a voice for a visual avatar that may be extreme, and may have very little resemblance or semblance of Ryan Steelberg in real life.
I think dating is actually one commerce. Of course, people, by the sheer nature, they're going to want to experience different products and services in a 3D environment, they want to walk around a car and spin it around. They want to look at what a dress or an outfit might look like, all these opportunities are now possible. It's just a question of are people finding the right opportunity in these 3D immersive worlds that may be a differentiated opportunity, or better than they could get in real life? Some people may never, ever be able to appreciate the opportunity to buy a car by looking at a 3D model of it, and they need to sit in the actual physical car and take it for a true test drive. So, we'll see. Again, I think what you're going to see here is a lot of the larger Web 2.0 platform opportunities, dating, commerce and other things are all going to be tried out and iterated upon and tested in Web 3.0 with more immersive metaverses.
[00:16:12] MM: Yeah, I'm just waiting for the day where I can smell perfume over the internet. So, I can know whether or not I like it, just instead of reading the description of, “Oh, this is floral scent.”
[00:16:23] RS: Yeah, I mean, the haptic suits, we've all – many of us have frequent Disneyland or Disney World where they have – out here, California venture where you're flying, obviously over the different areas looking at a screen, but you're smelling the pine trees. You're smelling the Orange Grove, when you're flying over Orange County, California, and there's actually been devices now. There's been peripherals that you can plug into your PC that will allow you to get a very limited array of different senses. Again, the smelling of pine, et cetera. It is another sense that can be activated and will absolutely add more authenticity to a 3D world. Haptic suits is another one, right? When you're running through a game and you hit something, you will actually feel it on your body.
Again, I look at those as, again, if you look at all your different senses, you're going to see a gradual increase in the number or the extent in the comprehensiveness of activating those and servicing those additional senses. Smell absolutely is fundamental in almost every aspect of our human existence and that will absolutely be a core staple here in the next few years.
[00:17:29] MM: That's really incredible. I can't wait. And then talking about haptic suit, I don't really need one when I'm playing Oculus, especially when I run into walls, as they go to the boundary lines. What should companies be focusing on as their strategy for leveraging these new immersive channels? Of course, not all channels are the same. We've got meta that seems to be focused on B2C, and then you have NVIDIA’s developer space or the real estate, Second Life, Somnium platform. How much of this is like guessing on which cryptocurrency is going to win?
[00:18:04] RS: It's a great question. I think some of the big speculative things that have happened with NFTs and buying real estate property in a virtual world, just actually this week, you're starting to read articles about 99% drop in values, already, in some of these things. We mentioned when we were discussing earlier today about somebody bought Jack Dorsey from Twitter's first tweet on Twitter for $2.1 million through as an NFT. That today has a value of about $6,800.
So, I think speculative areas, I would advise against making those type of brash moves so early, particularly if you're an established brand, you don't have to do that. I know Gucci is heavily invested in all things metaverse and Web 3.0. But my point is, they have such a killer brand, there's ways that they can very cost effectively enter and take advantage of the existing worlds out there. Horizon being just one of many, and metanoia like is let them experience it, and, frankly, work with these companies who are looking for partners like Gucci to come in and bring those brands and those opportunities into their worlds.
But again, I don't think it makes a lot of sense to go out and speculatively spend millions of dollars buying plots of land, right? Because again, I don't think that established brands need to do that. They need to be quick to act so they don't lose out on the opportunity. But I definitely would advise being the first in the pond for some of the more speculative things. In terms of the currency and some of the underlying underpinnings of the blockchain, which is really a primary driver of all this is going to support, that's a word that's going to be fought out. Thankfully, I think there's going to be different types of exchanges or there's going to be the ability to seamlessly exchange and leverage different currencies in the different worlds so you're not going to have to be – whether it's Metamask or different types of wallets out there, I don't think that any group should commit to any one platform. I think they will take an agnostic approach.
But thankfully, there's a lot of service providers out there and a lot of like Stripe and others who provide a lot of the technologies to run Web 2.0 commerce, they all are looking at a multi crypto currency opportunity, so it will make easier for consumers and enterprises to transact without having to commit to, again, one standard or one type of crypto.
[00:20:32] MM: Interesting. Okay. By no means is this a political party question. I like to stay out of politics as much as possible. But do you think by the next presidential election, we will have a presidential candidate avatar who are having debates in the metaverse?
[00:20:49] RS: I think absolutely. I think this one needs to be taken very carefully. I think this could be a huge win or major backfire for the candidates. Once again, I think of who is your audience? If these are certain candidates, like all of them, where they think that they have an underserved voter base, or they're trying to invigorate let's say a new class of voters, the metaverse and having a 3D experience inside Fortnight or Horizon may be a great extension, frankly, or if it's an older candidate, and they're trying to communicate to a younger audience, which is more akin more assimilated with the metaverse, that may make a lot of sense.
But again, if they're thinking about, if 90% of their audience, and their consumers and their potential voters are using other channels, they should focus there, right? So, I look again, I look at for political candidates, this should be viewed as an auxiliary extension of their campaigns. It definitely shouldn't be a core tenet, at least at this stage, in the current maturity level of the metaverses. And frankly, just the number of people that are actually engaged in them, but you absolutely will see it. You're going to see it at a local level, you're going to see at a national level, there will be debates, and people are going to show up and droves and stuff like that.
But again, I think it's going to be as a percentage to really moving the needle for voting, at least over the next couple years. I think those will be fringe. It will be a lot of marketing and a lot of discussion around it. Again, I would advise any candidate on both sides of the aisle, whatever position you're in, is make sure you still stay focused on your core audience, your core community, and wherever they are, that's where you should be marketing. The metaverse, you think is a good vehicle to extend or augment that, great. But I don't think it should be a core tenet.
[00:22:36] MM: Yeah. And maybe if it goes this way, or likely, like you're saying, I will show a little bit more interest in politics. What do you think are the most critical factors of success for individuals and companies moving into the metaverse? I know, you spoke a little bit about this earlier, but are there any other points that you want to drive home there?
[00:22:57] RS: Yeah, I mean, mine are more risk averse. So, my perspective is not speculative startups, but more established companies that have spent millions or billions of dollars building their brands, and whether those are content brands and IP, or their advertisers. I think, first and foremost is they got to make sure that they understand the risks associated with the metaverse. A lot of this is you either hear other horror stories of people have entire accounts wiped out and cryptos being stolen, et cetera.
So, I think this is new by the nature of what Web 3.0 is, it's a decentralized ecosystem, and with that, obviously presents a lot of opportunity, but it presents a lot of risk. So again, highest level is for groups who are trying to extend upon their current successful businesses and IP, and let's say content libraries, or whatever their current core business is, be smart. Test but be prudent. Make sure you are working with known and trusted partners. Make sure you have a great understanding of the security needed and required, and make sure again, you have clear understanding of ownership of your IP and your identity. If you can really get confident there, and again, stick with larger players, more established service providers out there, you're going to be fine.
Again, dip your toes in. You don't need to jump in headfirst into the deep end with this, and that's the luxury that you have of already having a well-established brand. You don't have to be first. It's more important to you to be prudent and wise and ready to move quickly. But again, on the flip side, if you jumped too quickly, you could have a very negative experience from Web 3.0, et cetera. So again, understand your audience, protect your brand and IP, and again, start testing today.
[00:24:48] MM: It feels like everyone, they’re saying that they are in the metaverse, they have the strategy, but when it comes to Veritone, how does Veritone credibly differentiate itself from say, the new well-funded startups to the “influencers” who may have sold a few NFTs or even made a few viral Twitch videos that are giving these multibillion-dollar brands guidance into the metaverse?
[00:25:15] RS: There are so many different aspects, and it's almost ubiquitous. The metaverse and Web 3.0, right? So, the areas where it specifically relates to Veritone is really focusing again on our two primary constituent groups, our clients, that are digital influencers and content brands and content groups, and making sure that we have the right technologies, whether that's for synthetic content creation, synthetic voices, NFTs and like, and make sure that all the efforts that we've done building up great protected and secure business opportunities for them can again be extended and augmented into the metaverse without compromising their very successful, I'll call Web 2.0 and offline businesses.
So, as it relates to, for example, content libraries. If we look at some of our partners, like CBS News and others, they have multibillion-dollar businesses that are all tied to the successful production and distribution and protection of their content, whether that's linear video over OTT channels and television or online. When they think about leveraging or extending that content to the metaverse, the same rules have to apply. Do I feel that this content can be protected? Do I feel that this content or my distribution can be monetized? I can't just give away free content, or have people rip it off and not get compensated for it.
Again, I think that Veritone brings that a very differentiated experience, because primarily, we've already been doing this with content groups for years in Web 2.0 and even in offline experiences. We understand obviously, the technology very well. But more importantly, we understand the business models, we understand the value of copyright and the importance of IP protection. That same thing applies to, I'll say, a slightly newer form of content, which is the digital influencers, that obviously they are the primary production house themselves, but it's their own voice, they are both the IP owner and the creator of the content. But the same rules apply. Making sure again, you know your audience, protect your IP, and make sure that if you do choose to start to distribute your content, or your persona or identity in the metaverse, the same rule should apply. You shouldn't be more cavalier or more open to security risks, you should have the same diligence to protect your IP, and if your goal is to generate revenue through distribution or licensing of your content, those same rules and principles should apply in Web 3.0.
So, Veritone, obviously, we view ourselves as a technology leader that has great understanding of these new technologies. But again, I would say equally, or even more importantly, is we understand the traditional businesses and we understand that a lot of the same principles, again, as relates to monetization, IP protection and copyright law are critical as you move into the metaverse.
[00:28:08] MM: Yeah. And you keep talking about know your audience and keep focusing on that. So, what is the value of our metaverse offerings for our Veritone’s targeted audience?
[00:28:22] RS: Well, know your audience. So, if you look at let's say, CBS News content, and obviously they have a multitude of different brands and shows. But each one of those shows whether it's online, OTT or linear broadcast has these different types of demographic and audience that they've spent a lot of time and money to build up. Let's say it's primarily male skewed, 18 to 49-year-olds, whatever it is. You shouldn't necessarily think of introducing your content in the metaverse to a brand-new audience. So, your baseline should be, okay, if this is my primary audience that I've been successful through Web 2.0, online distribution, OTT or linear, will there be a different type of audience that wants the same content? Let’s call it, 48 Hours, the TV show, highly successful, got podcasts that people are listening to, it's obviously got a major presence and revenue generating machine on television and OTT channels.
If you're going to start to do something with the brand of 48 Hours in the metaverse, in a more 3D immersive world, you still need to look at that same audience as the baseline, right? Do you feel that audience will carry over into the members? Or should they focus on a different brand first? Something that may have a slightly younger skew appeal that they want to start to focus on.
Again, it's imperative that you do not alienate your existing audience that a lot of these brands have already built up in Web 2.0 and more traditional in real life experiences and opportunities. But again, what is your strategy as it relates to the community and audience in Web 3.0? Are you trying to actually expand it? I know that I don't have a bunch of 75-year-olds that are all wearing Oculus Rifts in the metaverse, that may be watching 60 minutes. But is your goal to find younger audiences, right? Leveraging the brand of 60 minutes to extend it. Or is based on all your research and testing? You're saying, “No, I don't think 60 minutes is the right brand for us to start trying to distribute and activate in the metaverse. We should focus on a different brand.”
So, I think, again, always look at your current audience, what your current customer, your current community of followers, what has made you successful, that should be your baseline, and then when you look at what that opportunity may look like in the metaverse, that should be your true north and then you can make decisions on what you're trying to do. Am I literally trying to mobilize the same audience in a Web 3.0 environment? Or am I trying to do something different?
I think, again, for established brands, and established enterprises, which really is the market that Veritone has been focusing on as compared to brand new startups is, again, have a clear strategy of your audience and community and the continuum between what's made you successful offline, or in real life or Web 2.0, and compare that or contrast that with what your expectations and goals are in Web 3.0.
[00:31:21] MM: I love it. How can people learn more about our stance within the metaverse and meaning like Veritone’s stance?
[00:31:28] RS: Well, for a lot of our existing customers, obviously, we have our own account management teams and account reps that they can reach out to at any time and they've all been trained and educated on what we're doing. But we are launching an entirely – just because of the nature importance of Web 3.0 and the metaverse, we've actually created an entirely new dedicated microsite called VeriVerse. It’s is veriverse.com, which, again, from the perspective of content owners and digital influencers, it's a one stop shop where people can come to veriverse.com, learn about the metaverse in these 3D immersive worlds, and learn a lot more about specifically what Veritone is doing as relates to this opportunity and goes in depth into the products and services that we offer. So, I invite everybody, both existing and new prospective customers and partners to come visit veriverse.com.
[00:32:16] MM: Awesome. Thank you, Ryan, for giving us all your insights into your position, and Veritone’s position for the metaverse. Very excited to see how everything unfolds in the next 30, 60, 90 plus days, not only from Veritone’s perspective, but the entire world as individuals and as companies. Great conversation, and hopefully we can have you on with Jon Radoff and Theo Priestley in the near future.
[00:32:47] RS: Great. Thank you, Magen. Appreciate the time today.
[00:32:49] MM: Alright, take care.
[00:32:50] MM: What a great discussion this has been about the metaverse from Ryan Steelberg’s perspective. Thank you to everyone out there for listening to Adventures in AI, the podcast that dives into the many ways artificial intelligence is shaping the future for the better. Talk with you next time.
President and Co-Founder, Veritone