Hi there,

Our latest deep dive into AAM research, specifically the financial outlooks of leading air-taxi players, lit a fire under some lively online debates.

Thought we couldn't leap from one intensely debated hype topic to another even buzzier one? Well, hold our beer.

Today, we're venturing into the travel metaverse.

This time, though, we're shaking things up.

Instead of our usual data-heavy, analytical approach, we're venturing into more speculative and theoretical territory.

Less crunching numbers, more dreaming big.

To lend our journey a touch of grounded insight, we've teamed up with two big shots from the aviation world.

Dive in below to see who's joining us on this research collaboration.

Enjoy.

Your Lufthansa Innovation Hub Team

Research

Aviation's Metaverse Future in Four Scenarios

In late 2021, the metaverse hype captured the tech world's imagination, driven by rapid advancements in immersive technology, the cryptocurrency boom, and the accelerating popularity of NFTs.

However, 2023 saw a shift.

The buzz around the metaverse term has waned, largely due to the absence of tangible applications and prevailing confusion about what the metaverse genuinely entails—a topic we've explored thoroughly in our past article series.

Does this dip in popularity signal the demise of the metaverse and its foundational technologies, such as immersive tech, NFTs, and Web3?

We think it's unlikely!

Although the public focus may have shifted towards other innovation themes like GenAI, tangible progress has been made in the adoption of Web3 wallets, the refinement of immersive technologies, and the introduction of groundbreaking hardware devices.

A prime example is Apple's Vision Pro, a pioneering mixed-reality headset that aims to transform "spatial computing" into a component of everyday life.

The potential of such immersive technology extends well beyond everyday use, finding promising applications within the travel industry as well.

Not only did Apple specifically configure the device for use during the travel journey, for example, for in-flight use, but airlines are also eager to experiment with its capabilities to enhance the passenger experience.
For example, Beond, a niche premium airline, plans to provide the device to select passengers on its flights to the Maldives, offering immersive previews of the destination.

While it's too early to fully determine the Apple Vision Pro's impact, early adopters, including industry executives like Microsoft VP Omar Shahine, have shared positive inflight experiences and reviews on social platforms.

This steady interest underscores the enduring potential of metaverse technologies to innovate and enrich the travel experience.

All of this led us to ponder: How will the aviation industry navigate the metaverse landscape going forward?

Will it position itself as an early adopter or a fast follower?

To uncover insights, we gathered a panel of industry experts from various sectors within aviation.

Joint Collaboration By Aviation Experts

We at the Lufthansa Innovation Hub, alongside industry experts from Airbus and aviation think tank Bauhaus Luftfahrt, embarked on a deep dive into the potential futures of the metaverse and its implications for aviation.

In 2023, we harnessed a "scientific scenario-based approach" through a series of collaborative workshops, meticulously crafting and examining four potential evolution paths of the metaverse within the aviation industry over the next decade until 2035.

In the coming weeks, we'll unveil our key findings from these scenarios.

This initial post will introduce the methodology and thought process that guided our exploration.

Our Approach: Crafting Four Different Metaverse Scenarios

The future of the metaverse might seem ambiguous, but the various technologies and trends likely to shape its development are not.

Through a series of collaborative brainstorming sessions, we did the following:

Step 1: We identified key factors that could significantly affect how the metaverse will unfold, including regulatory and financial aspects, technological trends, and what drives adoption among consumers and businesses.
Step 2: From an initial list of well over 20 potential drivers, we evaluated and chose those deemed most critical. These selected factors are pivotal; they serve as the foundation for characterizing each of the four scenarios we've envisioned.

Here is a detailed list of all those factors.

How did we decide which factors to prioritize?

We evaluated each factor based on two critical aspects:

Potential Impact: We assessed how significantly each factor could influence the development of the metaverse. For instance, consumers' widespread adoption of metaverse devices and applications is crucial. Without a broad consumer embrace of immersive technology and related apps, the vision of a comprehensive metaverse remains unachievable.
Level of Uncertainty: We gauged the predictability of each factor's influence on the metaverse. Consumer adoption, for example, is highly unpredictable. Elements such as cost and ease of use are pivotal. Consider the initial excitement around the Vision Pro; despite early enthusiasm and queues at Apple stores, its long-term success isn't guaranteed. Recent feedback reports suggest a trend of returns due to discomfort, headaches, and eye strain.

In the below chart, you can see how the most critical factors score in the upper-right quadrant of our uncertainty-impact matrix.

These factors are characterized by both high impact and high uncertainty, making them particularly intriguing for further exploration within our scenario analyses.

Step 3

Next, our journey of distilling the critical elements for our scenarios took a deeper dive.

From the wide array of priority factors we initially identified, our task was to pinpoint the two most impactful ones—those absolutely pivotal for painting the picture of the metaverse's potential futures.

This required another analysis, where each prioritized factor underwent a rigorous evaluation to spotlight those with the most profound implications for the metaverse's trajectory.

Two key factors emerged as the cornerstones of our scenario framework.

Consumer Adoption: As previously explained, its pivotal role is unmatched, occupying the top ranks for both "impact" and "uncertainty." It serves as a central component in the potential future of the metaverse, characterized by both possibilities and challenges.
Metaverse Consolidation: This factor addresses the critical question of whether a cohesive, holistic metaverse infrastructure will materialize, as opposed to a fragmented landscape of platforms with limited interoperability.

Our rationale for zeroing in on metaverse consolidation is simple yet profound.

Considering our view of the metaverse as a seamless blend of physical and digital worlds, enabled by immersive technology and the exchange of digital assets, its success relies on the development of a unified infrastructure.

Such an infrastructure would need to transcend geographical, demographic, and product boundaries, embodying a level of consolidation or "unity" that is currently absent.

In the present landscape, we observe a patchwork of fragmented "metaverses," from gaming realms like Decentraland to luxury retail experiences by brands such as Louis Vuitton and Gucci.
However, these platforms operate in isolation, lacking the crucial interoperability that would enable a free flow of information and digital assets between them.

This fragmentation poses a significant barrier to the emergence of a holistic metaverse.

Thus, by selecting consumer adoption and metaverse consolidation as our foundational factors, we laid the groundwork for our scenarios.

Step 4

Ultimately, we positioned these two pivotal factors as the axes for our scenario matrix, crafting the very structure upon which our future visions of the metaverse would be built.

Here is what that looks like:

It's through this framework that we began crafting our four scenarios, each one a distinct narrative shaped by how these essential factors interplay and influence the metaverse's unfolding story.

While detailed explorations of these scenarios will unfold in our upcoming series, you can already access a sneak peek of what we're thinking in the full opening article on TNMT.com.

Read in Full

Ready to dive deeper into each scenario?

Over the coming months, we'll roll out a detailed series, breaking down each scenario to uncover the potential future of the metaverse in travel.

Don't miss out–the metaverse future might be closer than you think!

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Most Recent Investment Deals

– VC –

inDrive - The California-based ride-hailing app raised an additional $150M in a funding round led by General Catalyst, which will be used to drive growth, expand service offerings, and enter new markets.

BlaBlaCar - The French carpooling and bus ticketing company secured $108M in debt financing from several big banks in France, the UK, and US to support the company's growth ambitions.

Moove - The Nigerian mobility fintech raised $100M of Series B funding led by Uber. The funds will be primarily used for expansion into new markets.

Blueground - The London-based furnished apartment rental platform raised $45M in Series D funding from Susquehanna Private Equity Investments, WestCap, and others. The money will support market expansion and technology investments.

TCab Tech - The Shanghai-based eVTOL developer raised an additional $20M to close out its Series A round from an unnamed strategic investment fund that plans to introduce the company's vehicles in the Middle East.

Ember - The Scottish company, which is building out the UK's first all-electric intercity bus network, raised $14M in Series A funding led by Inven Capital, 2150 and AENU, with participation from Contrarian Ventures, Pale blue dot, and others. The funds will support expansion throughout the entire country.

Moonware - The California-based startup, which uses AI to improve airport ground operations, raised $7M in seed funding led by Third Prime and Zero Infinity Partners, with participation from The House Fund, Lorimer Ventures and others. The funds will support workforce expansion, R&D spend, and partnership searches.

Terragia - The Massachusetts-based biofuel startup raised $6M in seed funding led by Engine Ventures and Energy Impact Partners (EIP). The funds will be used to commercialize its proprietary biology-based fuel production process.

Stippl - The Amsterdam-based social travel app raised $630K of pre-seed funding, which will be used to continue product development for early users. Marbruck Investments and Volve Capital led the round.

– M&A –

CWT - The Minneapolis-based business travel management company is set to be acquired by rival American Express Global Business Travel (Amex GBT) for $570M, pending regulatory approval. The deal would grow Amex GBT's existing client portfolio of 20,000 by 20%.

ETrav Tech - A minority stake in the Mumbai-based B2B provider of content to travel agents was acquired by Indian OTA, EaseMyTrip, for $4M in a move to grow the latter's non-air segments.

Direct Travel - The Colorado-based corporate travel management company was acquired for an undisclosed sum by a group of investors, including Steve Singh, Durable Capital Partners, Madrona Ventures, Top Tier Capital Partners, and Blackstone Credit & Insurance. The acquirers plan to grow the company's customer base in all markets while also expanding the number of markets and the company's product suite.

Doblemente - The Spanish travel tech company was acquired by Dutch business acquisition platform, Destino Holdings, as part of a plan to use acquisitions to create an inbound tourism platform where local tour operators sell directly from their destinations. The deal amount is not public.

GlobalReach - The London-based developer of wireless captive portal systems was acquired alongside Nomadix by Assa Abloy Global Solutions as a move to expand the latter's core business capabilities. Price was not disclosed.

LoungeUp - The Paris-based hotel CRM company was acquired by Paris-based D-Edge (Accor's hotel tech subsidiary) for an undisclosed amount as a way to expand the latter's group of products.

Nomadix - The California-based company offering Wi-Fi network solutions to hospitality companies was also acquired by Assa Abloy Global Solutions for an undisclosed amount. The deal is meant to expand the latter's core business capabilities.

SAFFiRE Renewables - The North Dakota-based SAF producer, part of a project supported by the US Department of Energy, was acquired by Southwest Airlines for an undisclosed sum, taking the airline from investor to sole owner. SAFFiRE is now expected to proceed with development of a production plant in Kansas.

VinHMS - The Singapore-based hospitality tech company focused on Southeast Asia was acquired by Vemanti Group. The deal brings together complementary business capabilities and market presence to offer clients more value.