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According to analysts, the existing legislations in China will also be used to regulate metaverse applications.
Leading technology companies in China are beginning to show interest in the metaverse. With some US firms like Meta Platforms (NASDAQ: FB) and Microsoft (NASDAQ: MSFT) going into the trending technology, China’s tech giants have also started investing in the space. However, tech giants in China are concerned about regulations as they take a more cautious approach. Already, Beijing keeps an eagle eye on the activities of its domestic tech firms.
Top companies in China that could be the pacesetters in debuting into the metaverse include Alibaba (NYSE: BABA). Others are Tencent (OTC: TCEHY), NetEase Inc. (NASDAQ: NTES), TikTok owner ByteDance, and more.
In a note published in January, Morgan Stanley (NASDAQ: MS) talked about the metaverse market in China. The investment banking company said that the total addressable market for the metaverse in the country could be about 52 trillion yuan, about $8 trillion. According to analysts, gaming, virtual reality, and social media could be a few of the early applications that would become part of the metaverse in China. As such, users may start buying virtual items in games or create a digital avatar of themselves to join meetings.
According to analysts, the existing legislations in China will also be used to regulate metaverse applications. China market analyst at Daxue Consulting, Hanyu Liu, said that each metaverse application would have its own unique set of regulations. The analyst added that the Chinese should expect” strict censorship,” saying that China’s metaverse may be separated from the international.
Tech Firms in China Explore the Metaverse
A managing partner at CloudTree Ventures, Winston Ma, spoke to CNBC about Metaverse. Ma said:
“Metaverse is the future of social network. All China’s tech giants have to embrace it to find new ways to engage the youngest generation of internet users, which is critical at the time when their business models on smartphones and mobile internet are matured.”
Before now, Tencent CEO Pony Ma also talked about how the Metaverse could benefit the gaming industry. During an earnings call in November last year, the CEO said that the metaverse would help the gaming industry and other industries to grow further. According to Ma, Tencent has “a lot of the technology and know-how building blocks” to explore the metaverse.
On the other hand, ByteDance expanded into the gaming space last year after acquiring gaming studio Moonton. At the time, ByteDance said in a statement that the acquisition would help its gaming strategy across the international markets. Meanwhile, two anonymous sources confirmed that the deal was worth $4 billion. ByteDance went further in its expansion in August when it purchased a virtual reality headset maker Pico.
Alibaba also plans to launch augmented reality glasses for virtual meetings this year. At the same time, NetEase now has a base for metaverse development in the southern province of Hainan. The list of tech companies in China making their way into the metaverse continues. In 2021, Baidu launched a metaverse app called XiRang. The app is a kind of virtual world that can accommodate up to 100,000 people simultaneously.