"Afraid of Being Hampered by Regulations" Why Meta Is Persuading Washington DC [Next.Jjin]

Mark Zuckerberg, CEO of Meta
Photo by Reuters

[Asia Economy Reporter Jeong Hyunjin] Employees of Meta Platforms' product and policy teams, the parent company of Facebook, have been focusing in recent months on introducing what the metaverse is and how users work, shop, and play in the virtual world in Washington DC, USA. This effort aims to persuade the increasingly distrustful political circles of big tech companies and instill the belief that "the metaverse is not evil."

According to Bloomberg News citing sources on the 7th (local time), what Meta employees mainly do in Washington DC is meet with think tanks and nonprofit organization officials to explain the metaverse. They are prioritizing persuading external groups, mainly institutions pursuing free-market economics that Meta has supported, conducting a kind of campaign to reduce the political burden of imposing regulations.

Bloomberg reported, "Before discussing with highly skeptical members of Congress about Meta's next moves, CEO Mark Zuckerberg is trying to start a soft campaign to dispel concerns among insiders in Washington," and conveyed that the initial motto of "move fast and innovate" has changed.

CEO Zuckerberg's decision to take such measures likely stems from having been summoned to Congress multiple times and experiencing difficulties due to various regulatory measures. Both the Democratic and Republican parties, busy checking each other in Congress, share equal concerns about Facebook's fake news, hate speech, and online child protection, so they do not view Meta favorably. Some lawmakers have already openly expressed distrust since Facebook changed its name to Meta in October last year.

[Image source=Reuters Yonhap News]

In particular, after changing its name from Facebook to Meta, Roger McNamee, a U.S. venture capitalist and one of Facebook's early investors, pointed out to BBC that "Facebook should not be allowed to create a dystopian metaverse," indicating that distrust toward Meta's expansion into the metaverse business is significant.

What is the problem?

The metaverse has rapidly gained attention since last year due to its business scalability, but several unresolved issues follow. First is the issue of data privacy. The three-dimensional virtual space called the metaverse is expected to rapidly expand its usage and become part of work life within a few years. Currently, it is difficult to prevent the metaverse operator from collecting data when individuals engage in activities within the metaverse. This means a kind of "surveillance" could become possible.

David Bundy, Director at global consulting firm PwC, pointed out, "In the metaverse, because it may be related to decentralized networks, it is not easy to designate who is responsible for data processing." He emphasized that legal factors must be considered, such as who is responsible if data is lost or stolen, how to notify users about privacy protection, and how to obtain consent for sensitive data like biometric data or data of minors.

[Image source=Reuters Yonhap News]

There are other issues as well. Problems arising from the expanded use of non-fungible tokens (NFTs), which are mainly utilized in the metaverse, need to be addressed. Many factors need consideration, such as how to define the nature of NFTs, how to view NFT ownership, and whether virtual real estate should be subject to existing real-world real estate laws.

Also, various incidents such as violence, hate, sexual crimes, trademark infringement, and copyright violations that have occurred on social networking services (SNS) are already happening in the metaverse, which is one of the reasons Congress views the metaverse unfavorably. Meta recently introduced a "personal boundary" feature that prevents avatars from approaching each other beyond a certain distance to prevent sexual harassment within the metaverse.

There is a growing argument that to build a stable ecosystem in the virtual world of the metaverse as in the real world, appropriate regulations and foundational management must be established. Especially given the distrust of Facebook in U.S. politics, these issues are expected to become even more significant.

Calls for "foundation establishment" in Korea and the EU

As the metaverse rapidly spreads worldwide, this is not just a problem in the United States. Voices calling for regulation are growing in Europe as well as domestically in Korea.

[Image source=AP Yonhap News]

Margrethe Vestager, European Commissioner for Competition of the European Union (EU), recently said in an interview with Politico that the metaverse presents new challenges for antitrust regulators. Commissioner Vestager emphasized, "As metaverse usage expands, including the use of NFTs, discussions on this must start now. Investigations into the metaverse are still in the early stages, and we are considering how to ask the right questions." Since Europe has focused more on monopoly issues of big tech companies and user privacy protection compared to other regions, it is cautiously expected that stringent regulations may be enacted.

In Korea, on the 11th of last month, Kim Young-sik of the People Power Party introduced the "Metaverse Industry Promotion Act" as a representative bill, followed by Cho Seung-rae of the Democratic Party submitting the "Act on the Development and Support of the Virtual Convergence Economy" to the National Assembly on the 25th of the same month. At a forum held in the National Assembly, experts argued that to promote the metaverse industry, a whole-of-government decision-making system capable of effectively coordinating related policies is necessary, and that legal status for virtual assets and NFTs used in the metaverse must be established.

The metaverse is a fascinating and amazing new world. Given its limitless business scalability, many things will happen in the virtual space just as in the real world. We hope that companies nurturing the metaverse and politicians building its foundation will conduct healthy discussions to ensure innovation and growth proceed in the right direction.

Editor's Note[Next.Jjin] means 'looking ahead to the real next of business' and is a corner delivering overseas news related to future businesses and startups such as the metaverse, artificial intelligence (AI), and robots. We will uncover and explain both major visible issues and small but important hidden issues in an easy-to-understand manner.

This content was produced with the assistance of AI translation services.