As companies seek to build out the metaverse, Microsoft Corp. may already have many of the necessary tools in its pocket.
The metaverse has become a hot buzzword lately as companies like Facebook-parent Meta Platforms Inc.
FB,
Microsoft
MSFT,
Roblox Corp.
RBLX,
and Epic Games explore the possibility of new virtual worlds through which people can connect. The concept is still in early innings, and it’s not yet clear whether there will ultimately be one or many metaverses, but Bernstein analyst Mark Moerdler has confidence in the idea that software companies stand to benefit as the tech world works to realize its virtual vision.
With its array of tools for mixed reality, gaming, professional services and more, Microsoft is his top pick among enterprise-software players that could capitalize on metaverse opportunities.
“While both Adobe and Salesforce could see upside it is, we believe, Microsoft that is best positioned to be a big winner from the metaverse,” he wrote. “In fact, even the journey from concepts to reality will be beneficial for software and especially Microsoft.”
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Software will make up the backbone of the metaverse, in Moerdler’s view, and Microsoft could hit on the concept from many different approaches. The company’s Azure cloud-computing services offer development and monetization tools, artificial-intelligence capabilities, and privacy functions, all of which could be helpful for a metaverse buildout.
Importantly, Microsoft has both its own functions that could be offered within the metaverse and tools that would be useful to third-party vendors that want to operate there, according to Moerdler.
The privacy offerings, for example, would be “table stakes for any tech vendors hoping to be a metaverse platform,” he wrote.
The company also has its HoloLens virtual- and augmented-reality technology that could prove valuable in a number of ways: “Whether Microsoft builds their own metaverse hardware or develops the designs which it hands to its partners is unknown, but the optionality is there.”
Competition admittedly is heated, and the Wall Street Journal recently reported that some HoloLens developers have left for Meta Platforms.
While companies have highlighted the social possibilities that the metaverse offers, Moerdler expects that people may also look to conduct business in virtual settings. “It is here where Microsoft can add a level of capabilities that the consumer internet vendors lack,” he wrote, citing LinkedIn and Office365.
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“We would argue that Microsoft is extremely well positioned having almost all of the major capabilities required to deliver a metaverse platform today,” he concluded.
Other possible software beneficiaries include Adobe Inc.
ADBE,
which has creative tools that could be used to design virtual experiences, and Salesforce.com Inc.
CRM,
which brings marketing capabilities as well as a collaboration program in Slack.
