How Yuga Labs hopes to get to the metaverse first with Otherside

Yuga Labs has managed to sell $1 billion worth of non-fungible tokens (NFTs) to virtual land prospectors, known as Voyagers, who have purchased tokenized land plots in the Otherside virtual world. And in July, the company gave 4,500 Voyagers access to the “first trip” for its Otherside metaverse.

In March, Miami-based Yuga Labs raised $450 million at a valuation of $4 billion. It did so because it has created one of the most popular new NFT brands in the form of The Bored Ape Yacht Club, but like other NFT companies it needs to give owners some utility for their NFTs, which use the digital ledger of blockchain to authenticate unique digital items. And getting them access to the first trip was part of the reward for the Voyagers.

The Otherside demo was made possible by the software of Improbable, a Cambridge, England-based company that has been experimenting with technology to build massive gaming worlds for years.

In the demo of Otherside, Yuga and Improbable were able to bring 4,500 players together at once in a tight 3D space. What was remarkable about that was that the players enjoyed full physics effects for their characters, and they could speak with each other using 3D audio and hear all the players at once.

Nicole Muniz, CEO of Yuga Labs, talked to me about this grand experiment. While she believes Otherside will be “a metaverse, but not necessarily the metaverse,” Muniz said she was very happy that the demo could show people what’s possible with a big investment in technology. (I talked with Improbable CEO Herman Narula about the tech that made the demo work).

The demo made a decent impression. On the weekend of the First Trip for Otherside, fans mentioned Otherside and linked to it 34,000 times, with 29,000 mentions of @OthersideMeta and 2,000 mentions of Otherside and “first trip.” But it’s up for discussion as to whether this was a big moment for the metaverse. I talked with Muniz about this matters, including resistance to NFTs from hardcore gamers.

Here’s an edited transcript of our interview.

GamesBeat: It certainly seems like a big leap forward for what’s been possible with real-time metaverse applications. That’s what caught my attention with this demo. I wanted to see it from your perspective as well. Is there a general overview of how you view the metaverse and what the Otherside project in particular fits in that vision?

Nicole Muniz: That’s a question that has about 20 questions inside of it. What I can pull back and start with is, I don’t know that there will be “a metaverse.” That’s a big maybe. In terms of our vision, what we’re excited about as far as the future of this space is an opportunity to build on some core web3 tenets. By that I mean identity is super important when we think about Web3. It’s clearly a thread that’s woven through everything we do at Yuga. I can break that down a bit more. Ownership as well is very important. Interoperability and how that fits alongside and adjacent to decentralization, or in addition–sometimes it’s the same and sometimes they’re different depending on who you talk to. Those are the tenets of web3 that we think are the spine of this next phase of the internet.

When we think about metaverses, it’s an opportunity to build a rich experience, a dynamic experience, that has these things woven into it. One thing we have to sometimes ask ourselves is, “Do you own your identity in this space? Can you take the things you own, the things you bring to the table, in and out of these spaces?” That’s why I don’t necessarily know that there’s “a metaverse.” There will be different metaverses, different spaces or online worlds or whatever we want to call them. The bigger concept is, are they interoperable? Can you go from one experience to another? What are your rights within those spaces?

There’s a likelihood that there will be closed worlds and there will be open worlds. There will be worlds that aren’t interoperable, where you don’t necessarily own anything and they aren’t decentralized. That’s okay too. The internet is big enough for all.

GamesBeat: You have the resources to do the decentralized side right. Otherside itself, how should we look at it? It’s a nice one-time event so far, but is there anything you learned? Is it a sign of something more permanent to come?

Muniz: Our real vision for Otherside is for it to be an open, interoperable world. If you think of this as–I’ll use a very strange analog that isn’t right, but it’s the easiest way to explain it. This is our digital Disney World. What’s cool about this digital Disney World and why it’s differentiated is it’s an open world. It’s not just a place for our IP. It’s not just a place for apes and mutants and punks and Otherside characters. It’s a place for anybody. It’s for your own character. That’s the identity part and the ownership part. If you’re a Cool Cat you’re welcome. If you’re something new that you’ve cooked up in your brain and you want to create a new character for yourself in this world, you can use our SDK to do that. That’s the vision.

Not only is it a place where all characters and all identities are welcome, but also it’s a place that’s not just for our rides and attractions, going back to the Disney World analogy. Anybody can build. We’re going to build things, rides and attractions for the world. We’re going to have layers of gameplay and different experiences that people can do so it’s engaging and fun. But that SDK will enable all sorts of creators and developers, big and small. Hobbyists, independents, game studios, they’ll also be able to build rich creative experiences for the world and for the audience.

The First Trip was a demo. That’s what it was, literally. When we announced Otherside, this is a year-long road map. We’re aiming for our initial consumer experience. The Otherdeed holders are–unlike typical games, where you launch your cinematic trailer, and then two years later the game comes out and you pray that people like it, our process is different. Our process is iterative with the community. That’s why we’re calling it the Voyager’s Journey. You get to be part of the development of Otherside with us. You get to have a say in that.

Part of it is things like the First Trip, which are just demos. We get to hear community feedback and implement that feedback into the development in real time. There will also be richer points of engagement for the community to be able to have an impact on the world we’re building.

GamesBeat: The Improbable technology itself, until they did this demo a lot of people didn’t believe things like this would be possible with the current internet. The argument was that it might take 10 years before you could get something like this with thousands of people in it, the way you’d think the metaverse should be. What did you think of the tech itself? How integral is that for having this kind of metaverse-like experience?

Muniz: What’s really smart behind what Improbable has been doing–you mentioned that you’ve been following them for a long time. They had a solution for a problem that didn’t exist yet, for a long time. That’s what they were doing. Or they didn’t necessarily have the solution, but they were building that solution. That’s incredible. Also, by the way, sticking it out when people might have told you they were crazy–they stuck it out and said, “No, this will be a problem someday, and we’re going to start building for it now.”

That’s what excited us. We had the shared vision with them that that was a problem. We spoke to a lot of other studios, ranging from more traditional game studios to tech companies and a full mix in between. The truth of it was, when we would bring this up–we talked about the thing from our dreams. It’s that moment in the movie where you have the thousands of people in this world playing together. We want that movie moment. We would talk to people about it and they’d say, “But that’s not really fun.” There was always a reason why that was actually a bad idea. “Nobody really does that.”

For us that just read as a technical limitation. It’s not that it’s not fun. It’s just technically very difficult to do. In games you have this sort of stitching. It’s 100 people and then you try to create seamless stitching so people don’t realize that they’re jumping between servers and so on. We were very bullish on this very specific vision. It’s the vision that we had as kids at the movies. If that is core to this experience, then we needed to find the right partner or accept the fact that we needed to build it ourselves, and then our timelines would apply accordingly.

When we found Improbable, it was very much a meeting of the minds. Not only did we agree about the vision for this world and what the future holds, but we also had a lot of aligned incentives, a lot of aligned values. We also don’t have the exact same strengths, which is great. It enables us to be true partners and have a true collaboration.

GamesBeat: I get the sense that this can be done relatively cheaply. That’s part of the technology. You’re not requiring an infinite number of servers in order to make 4,500 people in one place happen. And the project probably won’t take 10 years to finish.

Muniz: Exactly. What we’ve demonstrated in First Trip was the 4,500 people. It’s 4,500 people in Otherside at the same time with no lag. When you think about that, that’s a historic moment for web3, and it’s also a historic moment. That’s not just a historic moment for web3. It’s a historic moment for gaming. What we’ve demonstrated is just the beginning. This is where we’re starting. Imagine what we’ll be able to do in the next year, and with the community.

That’s the whole part people don’t take into consideration. Our community is actively engaged, actively participating. They’re already building guilds. They’re already building for this world. There’s an incredibly rich culture and ecosystem already being created. That’s another element to this as well. It’s not just what Yuga is doing or what Improbable is doing. What is the community doing? How does that end up feeding into the greater experience overall?

GamesBeat: Did it feel like everybody was happy here? Did you get any signals from the participants here that they want you to go in a certain direction?

Muniz: We wanted the First Trip to be — it was very much an introduction. It was very much to get people to even see what this was going to be like. We didn’t have an overt amount of very specific KPIs that we wanted to get out of it. We did, of course, get things. Something that we saw that was one of the real question marks–were people going to get it? Was the fact that these were all individuals–you can play GTA online, and most of the characters you see in that world are not real people. They’re NPCs. The question was, “Will people get the fact that you’re in this world with 4,499 other people, and they’re real humans?” Would that be meaningful to people, or are they so used to NPCs that it doesn’t matter?

We saw that it did matter very much. There was an overwhelming response of people saying, “Holy shit, this is real. These are all real people.” The other thing we thought was a sort of moment — microphone was something that was very important to us as well. We didn’t just want to be able to have the scale of people playing and participating together. We wanted people to be able to talk to each other. I’ve seen a couple of people talk about it as skeuomorphic design. It’s that experience. You want people to be able to live and experience together, and part of that is the verbalization. But again, were people going to get it?

We didn’t even have to overly explain it. I don’t know if you participated in the First Trip, but pretty quickly, when we turned the voice on, the minute you started talking, people started understanding how they could use their voices, how they could engage. There were moments where, for instance, to break these crystals–we wanted to incorporate some gameplay to get people to use different features and see how it would perform. People got it. They just immediately started to understand how they could participate and engage. That was another moment where it was like the lightbulbs went off in our heads. This is working. We can do more with this.

The other things you start to see–one thing we got tons of positive feedback on was the tone and the storytelling. Curtis and the character design behind that. Just the tone was so refreshing to people. That was something that came up a lot. Curtis curses. He’s a little dirty. That’s also important. This is a world that’s going to have a very different brand feeling than a lot of the commercial products that are available right now. That’s unique to Yuga and the Yuga voice. Other things are more standard. People loved the boss fight. They loved launching themselves at this character all together and doing that in a shared experience. Again, you have hypotheses, but you don’t know if it’s going to work.

Then there are some things we still need to do. We had a retrospective on some things this morning. Some things we over-revved on. We spent a ton of time on some things and they didn’t matter. But that’s the point of First Trip and these prototypes, to be able to turn those dials.

GamesBeat: The Open Metaverse Alliance made their announcement this week. I don’t know if that was interesting to you, that this is bringing together Web3 companies into a standards-setting process.

Muniz: I did see that. I messaged them and said, “Hello?” Their response was, “You just had a baby, we were waiting! Can we talk?” And I said, “I’ve been working!” That’s a situation where it’s very cool, what they’re doing, and–I don’t have a formal response to that because I saw it when it came out. I thought, “This is awesome. How can we participate?”

GamesBeat: It sounds like you’re supportive of the idea, then.

Muniz: Yeah, absolutely.

GamesBeat: It does seem like the Web3 community needs that kind of representation to the broader metaverse vision or standard-setting.

Muniz: We’re in the early, early beginning of this space. Standards will be defined. They’ll be adjusted. They’ll be defined again. They’ll be rewritten. We’re so, so early. But it’s a good concept. It’s a good idea to try to enact.

GamesBeat: Did the 4,500 person limit actually seem like a limit? Would you want to see that number go higher?

Muniz: It wasn’t a 4,500 limit. We had more than 4,500 people concurrently in the game. We hit more than 4,500 people at one time. It just wasn’t necessarily all — we had people that dropped off. So 4,500 is the number to say. It was really 4,500 people that participated, though we hit greater numbers. But no, we want to see more. That’s where we’re starting.

GamesBeat: What other kinds of analogs are there? Like a concert–until you can do a concert, maybe you’re not there yet. But I don’t know what’s a compelling reason to get people to come in and stay in a place like this beyond the event.

Muniz: It depends on what you want to do. Yes, a concert is one idea. That’s a real thing that’s happening in real life that can be translated into a digital experience. With COVID we’ve started to see this happen already. A couple of brands came out during COVID where they were providing online digital concert experiences, and now obviously that’s shifted back to more in-person, or a combination. But concerts, absolutely. There are lots of analogs.

To the question of why people will come in, there will be gameplay. That’s a little different than some of the other metaverses in existence. We do see this as a meta-RPG, is what we call it. We will have gameplay that’s part of the core experience. There will be more to do. Otherwise you come into this space and ask, “Now what?” We want to have a built-in answer to “Now what?” Some people will be interested in that. Not everyone will want it. There will be people who are interested in other things. We see this as a diverse world that has a lot of different layers for different types of people.

GamesBeat: It’s interesting timing to have this demo while we’re in the middle of the “crypto winter.” What does that feel like? Do you think people maybe need a shot in the arm like this right now?

Muniz: I never thought about it like that, in that context specifically. It is a colder winter than we expected, but we did foresee this coming. We tried to set ourselves up as a company, and set up the development of Otherside specifically, in a way where we could — it was fully set up to succeed and be in a good place when we’re at the end of crypto winter, when spring comes. We wanted Otherside and Yuga to be in a strong position coming out of this. That’s why we made a lot of the decisions we made early this year.

Whether or not people need this — it’s so fun. Do people need fun? I don’t know if people need fun, but it is fun.

GamesBeat: It feels like they might need something to believe in, something optimistic coming down the road. That sort of affirmation that the metaverse is going to happen and it’s not 10 years away.

Muniz: What I will say is that markets ebb and flow. I truly believe that Web3 is here to stay. There is no question in my mind. Technology is not going to stop because of this crypto winter. That’s crazy. This is here to stay. Now, is Otherside an optimistic thing to look forward to within Web3? I hope so. I truly hope so.

Going back to what we were talking about earlier, this was a historic moment in tech. Not just a historic moment in Web3. Hopefully, and I don’t know if you got to participate in the First Trip, but hopefully you participated in it and you had some of the same moments that I did. I worked on building it, and I still had moments where I had chills and got a little teary-eyed. “Oh my God, it’s happening.” The shit we dreamed up as kids, that you see in sci-fi movies, it feels a bit like the beginning of that. Is that specific to crypto winter? No. That’s just cool and awesome. We get to be a stepping stone or a footnote in the story of the internet. That’s very cool.

GamesBeat: Do you see Otherside as the spearhead for the brand, given all the different things you’re doing?

Muniz: The way to think about Otherside is that it’s at the center of everything we’re doing. It lives across everything. We’ve already announced, for instance, that Noah has joined the company and will be spearheading CryptoPunks. There will be some fun stuff coming out very soon about some of the other things we’re doing. We have a lot of things in store for the entire portfolio of brands underneath the Yuga umbrella. But everything goes back to Otherside in that Otherside is, again, the world. It’s the world where everything can live and play and be expanded upon.