McKinsey predicts that the Metaverse economy will generate $5 trillion by 2030. Metaverse economy refers to an emerging economic system resulting from interactions between users, content creators and businesses within the metaverse. The Metaverse is an immersive, persistent virtual reality in which individuals and entities can interact in a variety of ways, similar to the real world. The metaverse economy includes the creation and sale of digital content, virtual transactions, metaverse-based experiences and services, virtual assets, and a community-based economy.
The potential of the metaverse economy presents great opportunities, and several major countries already have blueprints to establish themselves within the global supply chain. India, for example, is aiming to become a manufacturing hub for IoT devices that support the Metaverse, such as smart glasses. China is poised to establish itself as a provider of high-speed 5G and 6G internet technologies, a prerequisite for mass deployment of the Metaverse.
With a population of over 270 million and over 170 million internet users, Indonesia has great potential to become a center of creative content in the global metaverse economy. Factors such as demographics, digital infrastructure readiness, creative industry growth, and government support are some of the key assets that put Indonesia in a strategic position to benefit from the Metaverse phenomenon.
Elements and Assets:
The demographic of Indonesia is dominated by the younger creative and digitally savvy generation. They are a powerful source of information for developers, users and consumers of creative content. Moreover, Indonesia’s rich culture provides an endless source of inspiration for creative content creation, giving your content a unique touch that sets it apart from the rest.
Indonesia is an archipelago nation of 17,000 islands, each with more than 1,300 tribes, each with its own language, customs and culture. They all have different lifestyles, histories and traditions. Her over 700 languages are spoken by different ethnic groups in Indonesia. This cultural diversity represents a tangible and intangible asset that is an inexhaustible source of inspiration to support the creative industries of the Metaverse economy.
Indonesia’s creative industry has seen significant growth in recent years. The country is internationally recognized for its many young talents in the fields of film, music, design and games. Indonesian creative sector exports such as films, music, design and crafts have increased in recent years. According to the Creative Economy Agency (Bekraf), Indonesia’s creative industry exports totaled around $22 billion in 2019. As of the end of 2022, there are 2,400 digital start-ups in Indonesia, most of them in the creative industries. In Indonesia, he has seen the rise of Web3 and blockchain-based creative industry startups, such as Majalabs, which spawned digital fashion his startup Drezzo and art-focused Noah Project.
The Indonesian government recognizes the importance of the creative industry and is taking steps to support its growth, including incentives and funding. Furthermore, Indonesia, with a very active and dynamic startup community, exhibits a high degree of innovation and entrepreneurship.
To take advantage of this potential, you need to take a few steps. First, strengthening the digital infrastructure, such as increasing internet speeds, 5G networks, and access to advanced technologies, is crucial. According to a study conducted in China, at least 60% of the population should be connected to the Metaverse to facilitate mass adoption of the Metaverse.
Second, we need to improve education and training, especially in technology, digital art and design. The development of skilled workers is essential for creative industries in the Metaverse era.
To strengthen Indonesia’s potential in the Metaverse economy, formal education curricula at all levels from primary school, secondary school, high school and university should be revamped to include topics related to technology, digital arts and design. Subjects such as programming, graphic design, and animation should be part of this comprehensive curriculum.
Additionally, the power of technology must be harnessed to broaden access to education and training, especially for individuals living in underserved areas. This can be achieved through various digital platforms such as Massive Open Online Courses (MOOCs), webinars, and other online learning platforms. By democratizing access to these resources, Indonesia can develop a skilled workforce that can contribute to the global metaverse economy.
Third, we need more support for startups and entrepreneurs in the technology and creative content sectors. This can be achieved through access to capital and funding. Now, an alternative funding program for creative industry projects, especially music and film industries in Indonesia, is being launched by ID-Opentech Group, which brought tokenization and cryptography from South Korea. The idea is for fans and investors to support the project with NFTs.
Fourth, governments need to put in place regulations that support innovation and protect intellectual property rights. Finally, we need to foster an ecosystem where developers, designers, and artists can learn and collaborate, fostering the development of creative communities.
To make the most of this potential, strategic collaboration must be established. Collaboration between universities and industry fosters innovation and research. Collaboration with international technology companies can accelerate the adoption and development of the Metaverse. Partnerships between startups, between governments and the private sector, between artists and technologists are also important.
The Indonesian government should partner with global giants such as Microsoft, Metagroup, Apple, Google, Alibaba, Tencent, ByteDance and Huawei to help develop Indonesia’s creative industry ecosystem.
In addition, regional and international collaboration will help develop standards, share knowledge and best practices, and host joint events and conferences on the Metaverse. Indonesia’s strategic geographic position and neutral foreign policy position in the power struggle between the West and China could be leveraged to strengthen its bargaining power in the development of the local creative economic ecosystem.
Bali has great potential to host various international conferences and the Bali government recognizes the importance of developing non-tourism income streams. They are embracing the digital economy from 2022 by hosting Bali Digifest.
Majalabs is a great example of how a business initiative can bridge the gap between the Bali government, Bali’s digital nomadic community and local creative industry players in adopting blockchain and Web3 technologies, the predecessor of the Metaverse.
With its strategic geographic location in the Golden Triangle directly facing Singapore and Johor, Malaysia, Batam has the potential to become a center of research and innovation for the Metaverse. Batam now has a digital industry cluster at Nongsa Digital Park, home to an animation outsourcing company that is a major base of the Metaverse economy. The world’s largest data center will also be built on Batam, serving as a fundamental asset in the development of the Metaverse economy.
With the right approach and effective cooperation, Indonesia can leverage its vast potential in creative industries to become an important player in the global metaverse economy. Admittedly, it’s not an easy or quick journey. This will be a solution and asset for Indonesia to deal with its demographic dividend. The creative industries will absorb large amounts of labor and create jobs.
Of course, this is no easy task and requires the cooperation of all stakeholders, including government, industry and universities, to achieve this. According to my research, mass deployment of the metaverse will take another 5-10 years, so Indonesia still has plenty of time.