NetEase, China’s second largest video gaming company, has become the latest tech firm in the country to voice its commitment to the metaverse concept, joining a host of peers including Tencent Holdings in a rush to embrace what has been touted as the next iteration of the internet, despite scepticism from stock market regulators. William Ding Lei, founder and chief executive of NetEase, said during an earnings call with analysts on Tuesday that the Hangzhou-based company has already prepared the technologies and strategies required to build the metaverse, which has been loosely defined as a shared, immersive 3D virtual space where people can interact and trade. “When the metaverse eventually arrives … we’ll probably be the fastest runner around,” said Ding. What is the metaverse, how will it work and why does Facebook want in? While several Chinese tech giants including NetEase have quietly registered metaverse-related trademarks over the past few months, only recently did some of them openly share their plans to build out the metaverse. Interest around the nebulous concept surged to new heights last month after Facebook renamed itself Meta . Last week, Tencent, owner of the world’s biggest video gaming business and Chinese super app WeChat, publicly disclosed its vision for the metaverse for the first time when president Martin Lau said during an earnings call that the company can potentially approach the concept through a range of businesses, citing video games and social networks as its major strengths. Lau said that Beijing does not appear to be “fundamentally averse” to the metaverse, although it is expected to come up with a set of regulations different from the rest of the world. In the same week, China’s big three telecoms carriers – China Mobile, China Unicom and China Telecom – partnered with several tech companies to form China’s first industry group dedicated to the metaverse. At the founding ceremony of the “Metaverse Industry Committee”, the three telecoms giants discussed plans to leverage their advantages in 5G network infrastructure, cloud gaming and virtual reality (VR) technologies to shape the metaverse. Also last week, Baidu, the leading web search company in China, launched a new virtual world social platform named Xirang, in a move seen by many as its most tangible foray so far into the metaverse. In August, ByteDance, the world’s most valuable unicorn that is widely considered another contender in China’s metaverse race, bought VR start-up Pico Interactive in a deal estimated to be worth close to 5 billion yuan (US$772 million). The metaverse industry is forecast to be worth US$800 billion by 2024, according to Bloomberg Intelligence. Microsoft is building its own metaverse and it comes with PowerPoint Despite the enthusiasm, however, regulators and state media in China have expressed concerns over the market frenzy around the metaverse. Last week, the Economic Daily warned against speculative trading in metaverse concept stocks, sending share prices tumbling before paring losses this week. In a commentary, the state media outlet said that retail traders should not hastily put money into an “immature” concept like the metaverse since it is a project that requires long-term investment and development. Meanwhile a group of China-listed tech companies that have called themselves builders of the metaverse have drawn scrutiny from stock exchanges in Shenzhen and Shanghai , with regulators issuing inquiry letters to the firms asking for details on their involvement in the metaverse. Last month, a state-run think tank associated with China’s Ministry of State Security warned of national security risks involved with the metaverse , including cybersecurity risks and “technological hegemony”. Developing countries increasingly rely on technologies built by developed countries, and the metaverse could widen that gap, according to the think tank. Chinese state-owned think tank flags national security risks of metaverse For most companies, the technology behind metaverse still “looks very raw” and seems “mostly at the experimentation stage”, said Mio Kato, founder of LightStream Research, a financial consultancy focused on Asia. Tencent still lags behind Sony Group and Epic Games, the current leaders in metaverse, according to Kato, although Tencent owns 40 per cent of Epic. But Tencent’s investment into Wave, a US virtual concert organiser, marks a promising application of the metaverse concept, said Kato. “One positive for Tencent to look out for is the Justin Bieber concert held on Wave [on Thursday],” Kato said. He added that Epic’s Fortnite concert series, which has featured American rapper Travis Scott and pop star Ariana Grande performing in the popular battle royale video game, shows that the US game maker is far ahead of most players in the metaverse field.