Why Microsoft could be ‘extremely well-positioned’ for metaverse success

By January 13, 2022Metaverse
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Bernstein likes Microsoft’s positioning as he thinks about software companies that could benefit from metaverse opportunities.

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.”

Read: What is the ‘metaverse’ and how much will it be worth? Depends on whom you ask

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.

Opinion: We have been promised the ‘metaverse’ for decades, but it is still not a sure thing

“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, -2.91%, which has creative tools that could be used to design virtual experiences, and Salesforce.com Inc. CRM, -3.83%, which brings marketing capabilities as well as a collaboration program in Slack.

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