Friday, November 7, 2014

Money will Not be the Same after VR

"Money makes the world go round." It's a common phrase and one that I highly doubt will be going away anytime soon. VR like every medium before it will likewise have to deal with this question as no business or technology can flourish if no one's willing to pay for it. The question so becomes how Virtual Reality will deal with this preposition. To answer that, I've instead asked another question: "Why do we need money?" It may seem obvious, but I'm not so sure we should be so quick to judge considering that sheer impact VR will have on the value of everything. After all, if VR makes reality obsolete, why should things in reality cost more than things in VR? Let's have a look at this now.

Money is really just a stand in for objects of value. Modern paper money or data about monetary records on our computers are really just a metaphor for the actual items of value that are being exchanged: labor, natural resources, services. Before there was paper notes or coin there was bartering and in many respects, I think the modern monetary system is simply a more efficient progression of this system. So when people say that money makes the world go round, the idea at hand is that the exchange of items of value is what keeps our world a float. Modern society was born out of the steady settlement and interaction of many groups of people due to the mutual benefits of dividing work and exchanging the resources gained from that work to keep society running. With this in mind, what are the resources we gather and what gives them value.

Resources are really only existences that can be of benefit to a group or individual. For people, the basic 3 often cited are food, water, and shelter. If this were the only mandate, than the inefficiency of society would be a disaster. Beings of sentience like people are much more complex and desire far more than simply survival. While the suppression or lack of said urges are things some people strive  to achieve, the vast majority of people will always desire a better existence for themselves. It's simple really, if you want more, you get more. If we want more resources, we obtain more. That kind of a mindset is very simplistic however, and reality doesn't really mesh with it too well. There are resources everywhere, but we can't exactly make use of them sufficiently due to their state. This means that we can't really satiate needs quickly enough to properly keep up with demand. Demand. That is the key phrase here. The market and by extension the system at play that keeps society going is the one we call Supply and Demand. It is the primary system used to determine the value of something in the marketplace and will be the item that Virtual Reality will shake to it's core. It could possibly even destroy it all together in an extreme case. What makes me say that?

Everyone, it's sad to say, but almost everything that exists on the internet can be free. I don't wish to devalue the efforts or the labor that goes in to making things online, but if we think about things realistically, the true value of anything online is effectively free, with the exception of the labor necessary to place it there. Once a file has been created, it can be copied ad nauseum. The only real limit is the amount of storage available, bandwidth, and processing being applied. The greatest demonstration of this is piracy, which effectively makes everything free and with torrenting, online file depositories and basic file sharing. It's not really the transfer of resources so much as it is the communication of them. Computer data is ethereal and really only depends on the corporeal canvas that is memory and processing to exist.

Games and computers have taught us that they value we can get from them in comparison to almost any other kind of product out there. Until recently, our interactions with computers were limited to a simple display, speakers, and an input like a mouse & keyboard, touch screen, and or gamepad. With VR however, these interactions are taken up an order of magnitude beyond what we've had previously. Head mounted displays are starting to cross the line between real and digital. Binaural Audio 3D sound is nearing the point where it can be done in real time in software. Taste simulation has recently emulated 4/5 flavor types (sweet, sour, bitter, salty, umami(savory) is still missing). I believe touch is simply a matter of time and execution rather than difficulty. Smell has had attempts made and I honestly think it can be done with a bit of jury rigging. Add in that controls are being worked on and that the limiting factors are being whittled away by time and it's not a question of if VR will take over, but when. The experience it will provide will be of the likes we've never had before, harnessing the full potential of the computer's cyberspace to it's fullest...and that's where the economic question lay.

You see, if digital items are free due to their corporeal nature, but Virtual Reality makes them more personally valuable than the equivalent real world experience, isn't that functionally overloading supply and demand. If the supply is infinite and the demand is unable to satiate i, the system breaks down as you can't have any incentive to pay for things. Arguably this could be prevented by the quality of software, but software of the mobile space has proven that it doesn't need to be particularly good or costly to be played constantly. Many mobile games don't cost any more than a dollar or two if they aren't just plain free to play. Now, this will be applied to more mediums than ever, even food. Why would I pay for actually delicious, well prepared meals when I could just get something cheap and augment the flavor to whatever I want. Oatmeal can be a well done steak, water taste like soda. Likewise, even physical pleasures like sex or massages can be simulated at VR's peak operations. There is nothing in reality that can remain out of reach for Virtual Reality's capabilities provided enough time to do so.

Even having things physically loses an immense amount of value. A rock in VR is can be just as significant as one in reality. Seeing a person's VR face is as interesting and compelling as their real one. I first noted this to a degree when I observed how significant a VR rock looked and how much I wanted to bow down in Miku's VR presence. It's clearly a bit of hyperbole on my part in these cases due to the novelty of them, but it's really making me ponder genuinely the emotional  value of a VR item. A house I build in MineCraft can be very welcoming, I built it and it by my own labor, so what will this mean for items that I make in VR or buy. It should theoretically bear a similar degree of potential value to real items on some level since they bear comparable amounts of sensory data. A picture of a car can't quite as easily impress you as a full scale 3d rendering of a car in VR can, much less match the new car smell, comfort of the chair's fabric and cool feel of the metal on the outside. VR makes. Likewise, a real car can't quite as easily match the prices of a virtual equivalent when said equivalent can be either dirt cheap or free. Quite basically, why would anyone have an incentive to pay a premium for a real world experience when the virtual counterpart was comparable, if not a bit superior or inferior, all at a MUCH lower price. The price of a house in reality? Upwards of $100,000 depending on your region. The price of a house in VR? Whatever time it takes to model and rig it or to download the file.

Considering the amount of content you can get in VR for the price, unless we artificially raise the value of virtual items, people will have little incentive to pay for anything that doesn't relate to the VR experience. I can honestly imagine a future where entire buildings full of closet sized rooms with only enough space to fit the person, their  VR gear, a small supply of the cheapest nutritionally sufficient sustenance (If that isn't a part of an automated deliver system), a lock, and a decent internet connection become not only common place, but cost effective. You work your  daily job in  reality (if it even is in reality), stay home and spend your time in VR simulation where you are effectively the god of your reality. Your "real" living quarters may be a small closet, your virtual ones are an expansive virtual kingdom with a massive Sanctuary at its core. Your "real" food may be a nutrient rich sludge, but your virtual food and drinks are gourmet quality meals using the highest quality flavors hand tailored exactly to your personal tastes. Your "real" body may be an unfit, dull, unkempt mess that can't run a mile, but your virtual one is comparable to that of an Olympic god with performance to match. All this at much lower cost of  living compared to anything modern apartments cost people. At this stage, we start to see cultural issues come to the fore.

The modern capitalist model of many nations operates on the fundamental idea that people generally want to live in better conditions than they do. People work hard to earn more  money and improve their lives. Its argued that socialism, a system where all wealth is spread evenly doesn't work well in reality due to this philosophy since people don't like the idea of earning the same as someone who's performing a much less demanding job compared to their own. However, VR brings this problem to the capitalist system again since now a wealthy person won't be getting a dramatically better experience in life compared to their less well of counterparts. Computers with  the same specs don't discriminate, they just work.

Once could argue people would want better and better computers, but this may not be possible. Moore's  law is ironically going to defeat the computer market itself. When computers were initially released, they were massive, expensive, unwieldy and and impractical. They've since become compact, cheap, intuitive, and versatile. A modern computer is  capable of things today that dwarf the capabilities of a super computer from a decade or so earlier. This has been connected to "Moore's Law", an idea proposed by Intel co-founder Gordon Moore that computational power doubles ever 2 years or so (I've heard 18 months tossed around a bit as well). This has been holding strong for a long time, but alas, it's been complicated for the past few years. Year on year, the computer power gains aren't so much doubling so  much as they've been increases in 10-15%, perhaps 50% in the best of cases. Phones and tablets are the current computational growth kings, but they aren't exactly the cutting edge of  our power at this time, yet they are fast becoming, if not have already become the mainstream solution for computing. Why? Simple. The average user does need the power offered by a high end desktop to enjoy themselves. This may seem like a good things but it spells a deadly premonition for corporations in the near future if you ask me: the end of computational need. If Moore's Law suffers an end at any point in the near future, it will users will have no reason to buy new computers and will simply keep their old one's until the time comes that they need to replace it due to wear rather than obsolescence. If it continues on, eventually the common person will cease to buy it because there aren't any practical benefits. Once you've hit photo real graphics, where do we go next? What's the next marketing selling point, the physics? "POWERED BY THE NEW INTEL CORE i7 2970X, our PC can calculate 1 TRILLION different 1,000,000 POLYGON MODELS simultaneously at 100,000 FRAMES PER SECOND at a resolution of 1000 MEGAPIXELS! Buy now!" What's the point there? We biologically can't even observe those traits!

 At that stage, VR computation for the rich and the poor will be effectively equal with no benefits to buying a new one to your experience. A $100 PC would provide the same experience as a $10,000 PC. That is if you even need that power to begin with considering the cloud could be an equally viable method to gain your computing power and you'd only need to subscribe for a low monthly fee. At stage, where's the motivation to get a better quality of life go? To the few that still care about the difference between VR and Reality or who don't have access to VR in their region? In such a system, human motivation itself for anything outside of VR becomes questionable. Even I can't see a reason to by a big mansion in such a scenario.

Okay, I think I'm starting to ramble on a bit too much here. To sum it up, Virtual Reality will make us face the question of what we still consider worthy of value in reality. It seriously calls to mind Matrix like apocalypse scenarios where humanity simply allows itself to be cared for by machines while they spend their time away in Virtual simulations. The question there becomes whether or not that's what we want for our species or not? I'd like to say we should still strive to do something more, but I'm not to sure I'll be able to say that as easily once VR irons out its kinks. The root of human progress is the desire to satiate our sentient wants, a feat VR will reasonably be capable of doing  in the not to distant future. How about it, up for ditching  your body in a nutrition pod and living in the metaverse? It seems cheaper than what we've got now.

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