Metaverse Morgue: Touring the $69 Billion Virtual Reality That Nobody Uses

Introduction

You’ve seen the headlines: “Metaverse will be the next internet,” “Big tech pours billions into virtual worlds,” “Buy virtual land now.” Then you clicked into Decentraland and found an empty lot, or logged into a branded “experience” with one other avatar and a looping promotional video. Welcome to the Metaverse Morgue — a place of massive capital, hyped projections, and, frequently, ghost towns.

This exposé is for readers obsessed with digital behavior: researchers, product designers, sociologists, and anyone who studies how humans inhabit — or abandon — digital spaces. The numbers are messy and contradictory. On the one hand, recent industry tallies claim around 700 million monthly active metaverse users (June 2025) and a market that reportedly reached $203.7 billion in 2025, up from $130.5 billion the year before. On the other hand, major corporate initiatives hemorrhage cash (Meta’s Reality Labs posted a $17.7 billion operating loss in 2024 and $4.21 billion in Q1 2025 alone), virtual real estate speculation appears frothy, and anecdotal experience of platforms like Decentraland often feels like walking across an internet-era ghost town.

This piece pulls together the hard numbers and the lived reality. We’ll tour the economics, the user data, the platforms that look abandoned, and why a sector with staggering growth projections — a 44.4% CAGR and trillion-dollar forecasts for the next decade — still often looks empty. You’ll get data, on-the-ground observations, and, crucially, practical takeaways for anyone studying or designing for digital behavior in virtual spaces.

If you want to understand why metaverse projects attract billions and produce so many deserts of attention — and what might revive them — read on. This is less fanfare and more autopsy.

Understanding the Metaverse Reality

“Metaverse” isn’t one thing. It’s an umbrella for virtual and mixed reality environments, avatar social spaces, persistent 3D worlds, game-driven ecosystems, and AR overlays. That definitional fuzziness is part of the problem: it allows marketing to conflate gaming, enterprise XR, and NFT land sales under one glittering banner. The statistics reflect that conflation.

Aggregate usage figures appear impressive: approximately 700 million monthly active metaverse users as of June 2025. In the US, 26% of adults report using a metaverse platform in the past 12 months, and among VR headset owners, adoption rockets to around 80% — meaning core hardware users are intensely engaged. Awareness is broad: roughly 7 in 10 US adults have heard of the metaverse concept, and 33% say they’re curious about it.

Yet demographic skew is stark. A large portion of metaverse activity clusters in younger age groups; some figures suggest heavy concentration under age 16. Men are also far more likely to express interest — nearly three times as likely as women in some surveys. Those skews affect what spaces thrive: youth-centric, game-heavy virtual worlds do well; slow-moving, corporate-branded plazas do not.

Use-case breakdown helps explain the ghost-town phenomenon. Not all metaverse visits are equal: - Video games account for about 33% of metaverse applications. - Media entertainment makes up 18%. - Industrial manufacturing 15%. - Retail 14%. - Medical environments 13%. - Education 8%.

That distribution shows where real engagement lives: gaming and entertainment drive the bulk of attention, while retail, education, and corporate showrooms lag. A platform oriented toward social coffee chats or showrooming without compelling content, community, or utility is likely to feel empty even within a large metaverse ecosystem.

Hardware trends add nuance. XR headset shipments are accelerating — from 7 million units in 2020 to an estimated 105 million units by 2025 — and projections estimated about 110 million AR monthly users by the end of 2023 (up from 83.7 million in 2020). So the addressable audience is growing, but that doesn’t mean every virtual parcel will be populated. Hardware expands the potential stage; content and social dynamics fill (or abandon) it.

Finally, the money picture is paradoxical. Industry-wide revenue reportedly reached $203.7 billion in 2025, and analysts project continued high growth (44.4% CAGR) toward trillion-dollar valuations by 2030 and beyond. Yet major corporate bets have been loss-making: Meta’s Reality Labs produced $2.1 billion in revenue in 2024 and lost $17.7 billion operating that year, with $4.21 billion lost in Q1 2025 and cumulative losses north of $60 billion since 2020. Those losses shape product strategies and can create pressure to monetize quickly — sometimes at the expense of user experience.

Put simply: there are hundreds of millions of users, but the bulk of meaningful engagement is concentrated in gaming and entertainment; massive investments produce shiny but often underpopulated experiences; and the hype economy around virtual real estate has created both speculative windfalls and empty lots.

Key Components and Analysis

Let’s take the tour: what are the metaverse components, where the money flows, and why many places end up as ghost towns?

Virtual Real Estate and Speculation

Virtual land — parcels in worlds like Decentraland, The Sandbox, and similar platforms — became a marquee story. Early buyers and speculators snapped up “land” as NFTs, betting on future scarcity and foot traffic. That created headline valuations and a speculative market. But speculation is fickle. Without vibrant communities, ongoing content, and discoverable activities, land becomes a commodity with little recurring utility. The “virtual real estate crash” some commentators warn of isn’t necessarily a single collapse so much as a cooling of speculative demand: prices plateau or fall when expectations of perpetual growth collide with actual user behavior. Walk through Decentraland at off-peak hours and you’ll see the problem: parcels, heavily marketed, with minimal or no visitors — keywords: decentraland empty, metaverse ghost towns.

Platform Differentiation and UX

Gaming platforms dominate because they solve a basic problem: they are fun. Well-designed games have reward loops, multiplayer dynamics, and community drivers that encourage repeat visits. Many corporate metaverse projects mimic the surface of a game — avatars, branded spaces — without the underlying behavioral mechanics. The result: environments that look cool in screenshots but lack the hooks that create habitual use. This is where “Second Life abandoned” narratives come in. Second Life still has users decades after its launch, but it also demonstrates lifecycle effects: peak communities can drift, age, or segment into niche enclaves. New platforms often mistake visual fidelity for social gravity.

Hardware and Accessibility

XR shipments growth (from 7M in 2020 to ~105M in 2025) matters, but hardware adoption is uneven. High-end headsets remain expensive, and many users interact with metaverse-adjacent experiences on 2D devices or mobile AR. The experience gap between the promise of fully immersive 3D and the reality of mobile web experiences widens expectations and disappointment. The 80% adoption among VR headset owners shows hardcore users will use these spaces, but they remain a minority of the broader population.

Corporate Strategy and Burn Rates

Huge investments drive the industry forward but create incentives that don’t always align with organic community-building. Meta spent heavily to build Reality Labs, generating $2.1B revenue in 2024 but losing $17.7B that year. These losses indicate a long-term bet, but they also pressure teams to find near-term monetization — events, branded “experiences,” NFT drops — that often prioritize extractive revenue over user value. The result: spaces designed for transactions rather than social behavior, which contributes to sparse attendance outside launch hype cycles.

Use Case Fragmentation

Enterprise applications — industrial training, medical environments, business maintenance — show real ROI. $4.1B in 2024 funding for business training and industrial maintenance suggests the metaverse as tool can be valuable. Entertainment draws the crowd, enterprise funds sustain development, and retail/education still struggle to create sticky experiences. This fragmentation means a single platform rarely serves all needs; failure to find a core use case leaves places empty.

Awareness vs. Engagement

Awareness is high — roughly 70% of US adults have heard of the metaverse — but curiosity (33%) doesn’t always convert to sustained use. The ecosystem measures success in many ways: headline million-user counts can hide short-session visits or single-activity spikes. A monthly active user metric of 700 million is meaningful, but it's an aggregate across many domains; the distribution is not uniform. A handful of high-traffic game titles can account for a large slice of total activity while non-game environments remain deserted.

Analytically, these components interact to produce ghost towns. Speculative land buys create supply disconnected from organic demand. Corporate spaces without community mechanics fail to retain users. Hardware growth increases potential but doesn’t guarantee visits, and financial incentives push fast monetization over slow community formation.

Practical Applications

If you study digital behavior, design virtual experiences, or advise organizations thinking about metaverse investments, here are practical ways to read the landscape and act intelligently.

Prioritize behavioral hooks over visuals

Want users? Design reward loops, social incentives, and repeatable activities. High-fidelity graphics attract attention, but gameplay, community events, and meaningful social mechanics create return visits. For digital behavior researchers, measure retention and session depth, not surface user counts.

Target the right segment

Not all audiences engage equally. VR owners (80% adoption in metaverse use) are core users; youth demographics are heavy users. If you’re building a corporate showroom aimed at older, non-gaming adults, adapt the UX for lower technical thresholds: clear goals, low friction entry, and strong moderation.

Use enterprise wins to cross-pollinate

Industrial training and medical simulations show measurable ROI ($4.1B invested in such use cases in 2024). These enterprise applications can justify investment while helping create robust interaction paradigms that consumer spaces can borrow (onboarding flow, feedback loops, retention metrics).

Test small, iterate fast

Avoid buying large swathes of virtual land as speculation. Use smaller, testable projects to validate behavioral hypotheses. Developers should A/B test different social features (events, leaderboards, badges) and measure effect on revisit rates.

Design for discoverability

Empty parcels often fail because nobody knows they exist. Use cross-platform discovery, scheduled events, and integrated friend lists to channel attention. Syndicate events into broader communities rather than relying on organic foot traffic alone.

Measure the right KPIs

Monthly active users and revenue headlines are noisy. Track retention cohorts, DAU/MAU ratios, average session length, social graph growth, and recurring spend per active user. For academic research, combine quantitative telemetry with qualitative ethnography — why do users stay, and why do they leave?

Be cautious with virtual real estate

“Virtual real estate” can be a viable asset if tied to ongoing utility: events, community hubs, or content pipelines. Pure speculation is risky. If advising clients, stress that land is only as valuable as the people and experiences it attracts.

These applications aren’t operational magic — they’re principles for aligning product design to human behavior. The metaverse is populated by people who want reasons to return; give them one.

Challenges and Solutions

The ghost-town problem has technical, social, and economic roots. Below are the core challenges and practical solutions based on digital behavior insights.

Challenge: Speculation over sustainability - Problem: Speculative buying of virtual land decouples supply from demand. - Solution: Tie land to recurring utilities (events, creator residency, persistent content). Platforms can incentivize active stewardship (rewards for hosting events, tax on dormant parcels, or mechanic that reverts abandoned land to community trust).

Challenge: Lack of engaging mechanics in corporate spaces - Problem: Many branded experiences favor spectacle and marketing over social design. - Solution: Apply game design thinking: define clear player goals, social incentives, and rituals. Pilot smaller, interactive experiences with community input before scaling.

Challenge: Hardware and accessibility barriers - Problem: High-end XR cost and friction reduces mainstream adoption. - Solution: Optimize multi-device experiences. Ensure 2D web/mobile entry points offer meaningful interactions and tie into richer XR moments for invested users.

Challenge: Monetization vs. user value - Problem: Pressure to monetize leads to extractive models that harm retention. - Solution: Experiment with value-aligned revenue: event sponsorships, creator revenue shares, premium subscriptions for enhanced social features. Prioritize long-term engagement metrics over one-time transactions.

Challenge: Measurement illusions - Problem: Aggregate metrics hide uneven distributions of engagement. - Solution: Embrace granularity. Segment metrics by platform, geography, device, and cohort. Use qualitative research to contextualize telemetry.

Challenge: Gender and age imbalances - Problem: Environments skew male and young, limiting broader adoption. - Solution: Research barriers for underrepresented groups, design inclusive onboarding, moderate harassment, and create content appealing to a broader audience.

Challenge: Perception vs. reality - Problem: Public narrative (hype or doom) influences investment and user expectations. - Solution: Transparent reporting from platforms about activity patterns and use cases helps set realistic expectations. Scholars and journalists should highlight both success stories (enterprise training) and failures (empty parcels) to create balanced signals.

These solutions are not one-off fixes; they require cultural change inside companies, new KPIs, and patience. Building a durable social world is slow work — faster monetization strategies often undermine that work.

Future Outlook

Where does this all go from here? The metaverse is at an inflection point between speculative overreach and pragmatic utility. Several plausible scenarios emerge:

Consolidation and specialization

Expect fewer, more specialized platforms to dominate specific use cases. Gaming and entertainment platforms will stay front-and-center for consumer adoption, while enterprise XR (training, maintenance, medical) will continue to receive steady investment. The $203.7 billion market in 2025 and a 44.4% CAGR point to growth, but not uniform growth across all platform types.

Slow migration to meaningful AR/VR adoption

XR shipments climbing to about 105 million by 2025 establish a hardware base. As headsets and AR devices become cheaper and more comfortable, more users will move from curiosity to habitual use. That shift will favor platforms that have already built community dynamics, not those that rely purely on novelty.

Correction in speculative markets

The virtual real estate market will likely cool. “Virtual real estate crash” headlines may exaggerate a volatile correction, but expect reduced speculative ROI and greater scrutiny. Investors will favor platforms demonstrating real retention and monetization tied to utility.

Better measurement and regulation

As governments and researchers scrutinize economic and social impacts, transparency could improve. Platforms might publish more nuanced metrics (cohort retention, social network health) rather than only monthly active users. Regulation around consumer protection for NFT sales and virtual item transactions may also emerge, changing market dynamics.

Hybrid models win

Platforms that combine entertainment, social utility, and enterprise tools could succeed. Cross-pollination — enterprise-grade interaction patterns informing consumer worlds — will create more robust experiences.

Community-first revivals

Some deserted spaces can be revived by grassroots creators and communities. Second Life’s long tail demonstrates that persistent communities can sustain niche worlds for decades. Platforms that enable creator economies and community governance will be more resilient.

For researchers in digital behavior, the exciting part is that the metaverse remains a grand social experiment. The question isn’t only whether the metaverse will be used, but how it will be used: as an entertainment layer, an enterprise toolkit, a place of speculative exchange, or a combination. Current indicators — huge market numbers, major corporate burn, concentrated usage in gaming, and skeletal corporate-branded spaces — suggest an ecosystem sorting itself out.

Conclusion

The “Metaverse Morgue” label is sensational, but not entirely unfair. Walk into many headline virtual properties and you’ll find polished shells with few inhabitants. Yet the bigger picture is nuanced: hundreds of millions of users engage with metaverse-adjacent products; hardware shipments and AR/VR adoption are rising; enterprise applications are generating meaningful ROI; and the market — reported at $203.7 billion in 2025 with a 44.4% CAGR — continues to attract capital.

The real takeaway for anyone studying digital behavior is to look past the hype and the headlines. Measure retention not just reach. Design for people, not press releases. Be skeptical of speculative virtual real estate unless it’s tied to ongoing utility. And recognize that the metaverse is not a single city that either thrives or dies; it’s a constellation of neighborhoods, some lively, some abandoned, and many in between.

Actionable summary: - Prioritize engagement mechanics over spectacle. - Target clear user segments and adapt UX accordingly. - Use enterprise use-cases to validate interaction models. - Measure deep retention and cohort behavior, not only MAUs. - Be cautious about virtual real estate speculation. - Design for discoverability and community governance.

The morgue image will persist in stories — it’s a good headline. But for practitioners and researchers, the task is to turn empty lots into neighborhoods, and speculative bubbles into sustainable economies. The metaverse won’t die in a day; it will evolve, and our digital behavior research should help shape which parts of it survive.