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In a time when EU sovereignty is coming increasingly at the top of policymaker’s minds, the Commission aims to ensure that Europe does not miss the metaverse boat and fall behind foreign companies, like it did previously with the rise of social media. However, amidst this rapid evolution, questions arise regarding the need for additional legislative actions to govern the metaverse.
Virtual worlds, metaverse, Web 4.0: What are we talking about?
Becoming popular in 2021, the metaverse created a wave of interest and curiosity not only among tech enthusiasts but also among the general public. Leading the way in this new digital frontier is Meta, which rebranded itself in 2021 to reflect the company’s metaverse ambitions. Meanwhile, Apple preferred the designation “spatial computing” for its new augmented reality headset. Other companies have also invested in metaverse technologies including Nvidia with its Omniverse, or Microsoft with its multitude of collaboration tools. Although the term metaverse is largely used in academia, the Commission opted for reference to “virtual worlds” and “web 4.0” instead, creating some confusion on the scope of technologies, and among international partners
The Commission envisions virtual worlds as a natural evolution of the Internet, leading to web 4.0, where individuals seamlessly interact with and actively participate into the web’s creation. The metaverse utilizes virtual reality and augmented reality, Artificial Intelligence and Internet of Things technologies to generate immersive experiences. It also relies on decentralization technologies, such as blockchain, non-fungible tokens (NFTs), and cryptocurrency.
Enormous societal and economic potential
The Commission expects virtual worlds to have tremendous impact across various sectors, offering transformative opportunities for businesses, industries, and citizens. The Commission envisages many use-cases in the fields of healthcare, education, industry and entertainment, where virtual worlds can revolutionize remote services, training, research, immersive learning, and dynamic collaboration.
For the Commission, the stakes are undeniably high as projections from studies indicate substantial growth in the global virtual worlds market, exceeding EUR 800 billion by 2030. The integration of XR technologies, such as VR and AR, further fuels this expansion and is expected to create approximately 860,000 new jobs in Europe by 2025. It is clear, therefore, that the Commission aims to position Europe as a leader in the metaverse.
An EU Roadmap to Lead in the Metaverse
The Commission has taken proactive measures to ensure the EU harnesses the full potential of the metaverse while upholding European values and fundamental rights. As such, the virtual worlds strategy is built around 4 blocks: people and skills, businesses, governments and governance.
Putting people first, the Commission recognises the pivotal role of empowering individuals to unlock the full potential of virtual worlds. With the aim of raising awareness and nurturing a skilled workforce, the Commission will support the development of Europeans’ skills and promote guiding principles for fair, secure, and empowering virtual worlds. It hopes to allow people and businesses to thrive thanks to the metaverse.
The Commission also wants to ensure that Europe is part of the development of Web 4.0. The aim is twofold: 1) ensuring that Europe has the capabilities to develop technologies, and 2) creating a favourable virtual worlds environment for businesses. Through industry partnerships, support for creators, media companies, and European businesses, it also wants to foster research and innovation.
Going hand in hand with developing Europe’s own technology and businesses, the Commission wants Europe to be part of wider international discussions to promote the EU’s own values. Making virtual worlds open and interoperable is an essential step to ensure that Europe does not end up in the backseat, as it was with web 2.0, where major social media companies were for the most part located abroad and which the EU had, until recent years, little control over.
What next: Towards regulation?
The Commission acknowledges that existing legislation designed to regulate the Internet could extend to the metaverse. Notably, the Digital Markets Act and the Digital Services Act lay a robust foundation for Internet regulation, reinforced by Europe's well-developed data governance and privacy legislations. European consumers also enjoy a high level of protection thanks to the Unfair Commercial Practices Directive, or the General Product Safety Regulation. Moreover, the metaverse will be subject to regulation under more specialised legislation, such as the European Accessibility Act or the Crypto-Assets Regulations (MiCA).
Despite this array of EU legislations, uncertainty remains regarding the necessity of legislative actions tailored for the metaverse. While most stakeholders believe that it is too early for legislation, concerns have persisted from some industries over issues such as intellectual property and copyright, where ownership of virtual content and goods have yet to be clearly defined. It remains to be seen whether the Commission will take legislative action to supplement areas where current legislation fails.
In parallel, the European Parliament’s internal market and legal affairs committees are working on separate initiatives on the future of the metaverse. Whilst the internal market committee is expected to focus on market potential and consumer protection, the legal affairs committee will likely focus on copyright, intellectual property and contractual aspects. Both initiatives, once issued, will have the potential to influence the Commission’s future policy actions.
Conclusion
Although some would have hoped for more concrete actions to be included in the Commission’s virtual worlds strategy, ongoing technological and legislative developments will have a large impact on the Commission’s views and approach moving forward. The full impact of the application of digital services legislations, as well as the upcoming rules on AI, will inevitably push the Commission to continuously adapt its thinking.