Businesses wait and see on metaverse as tech debt limits experimentation

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Table of Contents

Dive Brief:

  • Despite splashy promises of brand involvement in the metaverse, the majority of enterprise leaders are taking a cautious approach to investing, according to KPMG data released Thursday.
  • Almost two-thirds of executives say they are waiting for competitors to invest in and/or adopt metaverse technologies before investing themselves.
  • Resource constraints are contributing to adoption delays. Nearly 7 in 10 businesses with plans to adopt the metaverse and Web3 say they’ll outsource and/or partner with tech companies instead of building capabilities in-house.

Dive Insight:

Consider the average enterprise IT leader, mired in modernization demands and asked to deliver faster and better technology despite budget constraints and unfavorable economic conditions. 

Despite the cautious approach, nearly 3 in 5 leaders say they have plans in place to invest in the metaverse in the next five years. Barry Brunsman, principal in KPMG’s CIO Advisory practice, said the data show an expectation that the technology is gaining momentum.

“Most people are recognizing, at least at a summary level, that these technologies represent the possibility of a very different business model,” said Brunsman.

And yet, most businesses are waiting for others to take the investment lead. Numbers show IT shops are still devoting much of their resources to their cloud journey and overall digital transformation.

“These technologies would represent a little bit more of a bet,” said Brunsman. “An important thing to have in your portfolio, but the portfolio I think is consumed largely with other aspects of digital transformation.”

Cloud, a key component of the technology stack for modern businesses, has already delivered clear wins for organizations, from greater agility to reduced up-front investments.

In fact, some analysts suggest businesses will cut costs elsewhere in the organization in order to invest in the cloud throughout an economic downturn in 2023.

“New technology certainly comes with risk,” said Brunsman. “If you think about the metaverse as an example, it is less easy for people to understand what needs to happen for that to be either a top line or bottom line impact.”