One feature of Mesh for Teams lets users join meetings as customized avatars of themselves, shown here with on-camera participants. (Microsoft Image)

Microsoft laid out its latest vision for a post-COVID work world Tuesday, touching on a buzzword that’s become increasingly prominent in recent weeks: the metaverse.

At its virtual Ignite 2021 conference Tuesday morning, the company announced a new product called Mesh for Teams, which allows workers to take the form of avatars and navigate virtual work environments.

It combines “shared holographic experiences” with existing communication tools like virtual meetings, chats and shared documents, Microsoft said. The software, which can be used with a smartphone, laptop or virtual reality device, is built on Microsoft’s existing Mesh technology, which the company first showed earlier this year.

A team’s daily standup meetings can be conducted in a virtual Mesh for Teams space that includes an interactive whiteboard, color-coded tasks or pictures of customers. Prototypes of products could even be laid out on a virtual table.

Colleagues interact and communicate via their avatars in Mesh for Teams. (Microsoft Image)

Microsoft also announced the public preview of Dynamics 365 Connected Spaces, which provides data about how people interact with factory floors, retail spaces and other physical work settings. Previously known as Dynamics 365 Connected Store, Connected Spaces helps companies harvest data from observed activity in a given physical space, generate insights from that data using AI-powered models and then respond to trends and patterns.

Both technologies are examples of the metaverse, which has long been regarded as a possible next iteration of the web.

Microsoft’s announcements come less than a week after Facebook said it would reshape its company into a new parent organization known as Meta and broaden its focus further beyond social media to developing metaverse-related experiences.

The metaverse, until recently the stuff of science fiction, is still a fuzzy concept. Generally speaking, it’s a boundless and interactive virtual environment, often envisioned in 3D, where humans take the form of avatars.

An interactive virtual space for collaboration in Mesh for Teams. (Microsoft Image)

The term was first introduced in Neal Stephenson’s 1992 science fiction novel “Snow Crash,” and the concept has appeared in other books and movies, including “Ready Player One” and “The Matrix.” In fact, early prototypes of the metaverse include multiplayer online games like Fortnite, Grand Theft Auto, Roblox and World of Warcraft.

The metaverse as “a persistent digital world that is connected to many aspects of the physical world, including people, places and things,” wrote Frank X. Shaw, Microsoft’s corporate vice president of communications in a blog post.

In other words, it’s a new vision of the internet that uses augmented reality, virtual reality and existing technology to create new and immersive ways for humans to interact with each other as well as the physical world.

Microsoft said, for example, that its cloud software is now capable of connecting with physical Internet of Things (IoT) devices in a way that creates a “digital twin” of the device in a virtual world. Changes to the virtual device in the cloud – or, if you will, metaverse – correspond with changes to the real life physical device. In this way a group of engineers scattered across the globe could meet in a virtual space and work out a problem with a piece of factory floor equipment.

Shaw wrote that the metaverse amounts to “both a new medium and an app type.”

“The metaverse enables shared experiences across both the physical and digital worlds,” he wrote, adding that as businesses continue to rely on software in a post-COVID world, “the metaverse can help people meet up in a digital environment, make meetings more comfortable with the use of avatars and facilitate creative collaboration from around the world.”

Microsoft is expanding cloud-based apps including Teams and Dynamics 365 as its cloud business continues to power the company’s bottom line. Revenues for Microsoft Cloud, previously known as Commercial Cloud, rose 36% to $20.7 billion in the most recent quarter, exceeding $20 billion in a quarter for the first time in the company’s history.

Microsoft CEO Satya Nadella described today’s Ignite announcements as “the next chapter of the Microsoft Cloud, and how we are building it for the era ahead.”

A virtual lobby in Mesh for Teams. (Microsoft Image)

Microsoft’s and Facebook’s embrace of the concept of the metaverse amounts to a major push toward a new way of interacting with both technology and other humans.

Those efforts come as little surprise as the COVID-19 pandemic plods into its second year. The pandemic kicked the development of collaboration software and companies’ adoption of cloud technologies into overdrive as it forced most knowledge workers to quarantine and work remotely. It amounted to the largest shift in the way work gets done since the advent of the PC.

Still, assuming the metaverse concept continues to gain traction, it will take time to build out its infrastructure, including new camera sensors in laptops and smartphones as well as adapting the web’s social media, e-commerce and other services to the new medium. The Information speculated last week that the metaverse could be worth $82 billion by 2025.

Yet, Facebook founder Mark Zuckerberg said last week that he intends for the metaverse to eventually reach a billion people and generate “hundreds of billions of dollars of digital commerce a day.”

In the meantime, both Facebook and Microsoft executives are adopting a sort of hybrid approach, where metaverse technologies are available in some form on all existing devices and as an option that augments – instead of replaces – today’s technologies.

Facebook’s Oculus virtual reality division, which it bought in 2014, will no doubt help it build out its vision of the metaverse. But Microsoft has plenty of assets to apply to its development of metaverse technologies, including widely used enterprise productivity software, Azure cloud infrastructure, Surface laptops and tablets, and HoloLens mixed reality headset.

Microsoft is turning to the metaverse as a potential solution to a prickly post-pandemic problem: As offices begin to reopen, many employees want to continue working remote at least some days of the week. At the same time, companies are trying to preserve the benefits of face-to-face interaction and maintain their workplace cultures.

“The ability to work from anywhere and connect with colleagues online is awesome, but remote meetings can feel impersonal and lack the small moments that build relationships and careers,” Microsoft said in a blog post about Mesh for Microsoft Teams published Tuesday.

Too many online meetings have proved “awkward and binary” – with the only view of colleagues as a static picture or a bubble containing their initials, Microsoft said.

Mesh for Teams is set to begin rolling out in the first part of next year.

Watch Nadella’s keynote address below, starting at the 20-minute mark.

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