Recommendations for augmenting existing systems and infrastructure
To prepare for wider adoption of metaverse technologies, the NSW Government needs to consider the systems, services and infrastructure that will enable its potential involvement. Regardless of the extent to which the NSW Government itself decides to build or deploy metaverse applications or platforms, the existing digital services it already provides (such as digital identity) may need to interact with metaverse environments. As a regulator, the government may also require new technology and infrastructure to perform its role in the metaverse.
The following sections outline some of the key enabling technologies and infrastructure that we believe the NSW Government should start considering now, to ensure that rapid metaverse adoption does not catch them by surprise.
Designing NSW Digital Identity for the metaverse
Digital identity is an important part of operating online today. This is true whether a user is interfacing with a phone app, a website or an avatar in a metaverse world. Given that metaverse adoption is still relatively low, there may be novel requirements for digital identity in the metaverse that have yet to emerge. We recommend that the NSW Government, as a digital identity provider, assume that digital identity will be an important service in the metaverse and consider what new technical, legal and regulatory issues arise as a result.
Anonymity and identity
In the diversity of virtual worlds and services, there will likely be a need for different levels of user identification. These levels range from anonymous, un-authenticated (and potentially automated) users through to fully authenticated legal individuals identified to the metaverse platform or service.
Anonymity and/or lack of authentication can create the potential for harmful behaviour. In the case of social media, the ability for users to be anonymous has been cited as a key causal factor driving societal problems such as amplified hate speech (including extreme racism), harassment, abuse and large-scale election manipulation. 
This has led to the calls for social media platforms, including metaverse developers, to require users to verify their identities with the platform provider, even if interacting anonymously on the social media platform. , 
There are situations where full anonymity is important, however. For example, Technology companies have shared sensitive information with governments in the past, including identity information.  Dissidents, human right activists and journalists pursuing the dissemination of truth about potentially inappropriate, self-serving or downright harmful government actions stand to lose unless they can be confident their work can be carried out under full anonymity. There is also public value in removing barriers to whistleblowing.
Similarly, the institutional status quo in different countries and jurisdictions is never politically neutral and full anonymity can be important for political minorities to voice their views. It is often difficult for individuals holding political views underrepresented among mainstream institutions to openly participate in the political process without being consistently censored, defamed or vilified. As an example, the Federalist Papers were written anonymously by three of the United States' Founding Fathers; given the controversial contents of the US constitution, their ratification could have been compromised or delayed had the papers not been written anonymously so as to prevent ad-hominem political backlashes.  Anonymity can be of critical importance to promote and maintain diversity in political discourse.
It is therefore important to acknowledge and recognise the legitimacy of this tension between potential benefits and harms of anonymity in the metaverse, and consider Digital Identity within the context of that tension.
Purposes of digital identity verification
Types of verification of users or of certain properties of users that are likely to be important in the metaverse include:
- Human verification (that the given person is a human - which could use, for example, a CAPTCHA-like service or be tied to a full legal verification service)
Example use case: NSW Food Safety Overlay to ensure that reviews are provided by people rather than bots.
- Age verification (that the user is of, is more than, or is less than a certain age)
Example use case: AR Gambling Bar to ensure participants are of a legal gambling age.
- Nationality or residence status verification (that the user is of a certain nationality or is a resident in a certain physical jurisdiction - for example NSW - where virtual services are relevant to physical jurisdiction)
Example use case: Region-restricted VR media streaming
- Legal identity verification (that the user is the legal person who they claim to be)
Example use case: Virtual nursing home visitations and VR courts to ensure participants are who they say they are.
There may be a role for governments to play in types above.
Some other forms of verification that are also likely to be used in the metaverse and may include government involvement include:
- Voucher verification (that a given voucher is valid - for example, vouchers for services like the NSW Government's Dine and Discover vouchers could be used to encourage people to use metaverse services run by NSW companies)
- Credential verification (that the identified user has the stated credential - for example accredited to provide a specific service related to healthcare provision, education provision, gambling service, etc).
Mechanisms of digital identity verification
The NSW Government describes digital identity as 'a form of transactional identity that allows customers to access services online. An 'identity provider' relies on existing legal and trusted transactional documents to confirm your identity and establish your digital identity. Digital accounts can allow the reuse of the identity information you have previously provided so that you don't need to keep providing evidence of your identity'. 
According to a NSW Government Digital Identity Strategy,  the main five principles involved in the NSW Government's digital identity policy and legislative development are:
- privacy, consent & control
- transparency & security
- user-centricity, inclusivity & accessibility
- technology neutrality & data portability
- simplicity, effectiveness & efficiency.
Although there are no explicit references to AR and VR compatibility — or the metaverse — in these principles, they are encompassed in the 'technology, neutrality & data portability' component. By creating a digital identity that is technology-agnostic and built with international standards in mind, users' identity will ideally be provable in any digital environment including VR and AR scenarios, such as in virtual courts and digital classrooms.
Existing mechanisms for digital identity verification for Internet services will likely be leveraged within the metaverse. For example, a metaverse platform provider may require that, for account creation, a user be associated with a legal identity as part of signing up. In such a case, the actions of this user over time could be associated with that legal identity (optionally with just-in-time authentication for specific actions). In other cases, association with a legal identity could be done on the use of a specific location (e.g. a virtual casino) or service.
Some examples of these existing mechanisms are:
- the ATO using voice authentication to verify a caller's identity 
- the NSW Government trialling comparing digital photos captured via a smartphone app against official images such as a driver's licence to confirm an individual's identity. 
For those metaverse platforms or worlds that use the blockchain, there are also some emerging proprietary approaches for 'Web3' decentralised identity verification products. This includes services such as Magic  (which supports email, WebAuthn, fido2 security keys), PhotoChromic  (an approach to a universal digital identity that is a single blockchain asset that maps to official physical ID) and Liquid Avatar  (for management, control and using verified digital identity and personal data). These may be utilised by some virtual worlds. These efforts are all at an early stage of development and are largely non-standardised (though in some cases make use of standards).
Augmenting NSW Spatial Digital Twin for metaverse support
The NSW Government's Spatial Digital Twin (SDT) project could become a useful resource for developers building metaverse applications, as well as for the government itself to use in development of its own metaverse applications.
The NSW SDT serves as a management, delivery and visualisation tool for various 3D and spatial and spatio-temporal data. The long-term vision of digital twins in general is to create a virtual replica of the real world in digital form that can be visualised, analysed and annotated.
There are some compelling reasons to explore augmenting SDT with support for metaverse technologies: Many of the existing digital twin use-cases naturally benefit from VR and AR. For example, the existing SDT contains telecommunications and infrastructure data intended to assist emergency response teams understand the locations of valuable infrastructure during e.g. a bushfire. The use of augmented reality display of this data could enable firefighters to make better use of it.
By extending the capabilities of the data access APIs already available in SDT to facilitate use by metaverse applications, the SDT could support a variety of useful, 3rd-party tools for NSW residents. Examples include:
- using live Transport NSW information to provide augmented reality overlays depicting the locations and routes of NSW buses, trains and ferries
- using spatial data from local councils to provide augment reality overlays for building planning and approvals
- using spatial data about telecommunications infrastructure to provide AR overlays for emergency response teams.
In considering building explicit support for metaverse applications, the government may need to examine:
- the feasibility of streaming raster, vector and mesh data to XR headsets, including formats for efficient ingestion by game engines commonly used to implement metaverse virtual worlds
- whether certain applications have constraints on latency or response time that impact the design and deployment of the APIs
- whether support for XR visualisation is feasible in the federated model of data provision currently employed by the SDT.
Identifying gaps in network infrastructure
Many homes and businesses in NSW lack high quality internet access. This is particularly true in remote areas, some of which don't have internet access at all. Such lack of connectivity introduces problems for accessing metaverse applications, many of which will require high-bandwidth, low-latency connections to function. Many of the potential NSW Government use-cases described in Metaverse applications with government involvement which would otherwise be useful for people in remote areas, such as remote telehealth consultations and remote learning, may be impossible to deploy due to poor connectivity. Upgrades to connectivity will therefore be critical to support wide access to metaverse applications for NSW residents and businesses.
Bandwidth and latency are the two key metrics that will determine an application's performance.
- Bandwidth is measured as the amount of data that can be transferred from one point to another within a network in a specific amount of time.
- Latency is an expression of how much time it takes for a data packet to travel from one designated point to another.
Most current VR applications pre-install content on the headset to reduce the amount that needs to be streamed, and/or stream low resolution assets all to reduce the bandwidth requirement. This limits the size and detail of the virtual worlds due to hardware constraints within the headset.
Today, applications that stream immersive 360 degree videos do so at a reduced resolution and still require about 25 Mbps. HD resolution videos demand about 100Mbps. As network speeds in the target markets improve, more apps will seek to stream their content from data centres to provide a grander and more immersive experience. Users on slower networks risk getting left behind. However, streaming data that is rendered on the headset may require considerably less bandwidth.
NSW and Sydney are in the bottom half of the table when ranked against international comparators based on average speed and penetration of broadband connectivity. Sydney averages speeds of 16.2 Mbps (below the 2018 SIS targets of 25 Mbps), which compares unfavourably with Hong Kong (26.5 Mbps), Seattle (42.7 Mbps) and Singapore (43.6 Mbps). Only 17% of National Broadband Network (NBN) connections are at 100Mbps or above, whereas in New Zealand 17% of fibre broadband customers are already on plans of 1 Gbps or above. 
NSW also has 'numerous areas with poor or no connectivity', with '4,000 reported mobile black spots that impact around 10,000 premises.' As a result, 'more than 26% of children under the age of 15 in remote areas of NSW did not have the internet at home in 2021. Only 23% of people living in outer regional, remote or very remote areas accessed telehealth services compared to 30.4% of those living in inner regional areas and cities.' Furthermore, '38% of NSW's Aboriginal households did not have an internet connection in 2016'. 
The NSW's Connectivity Strategy (released in October 2022 by the NSW Telco Authority) aims to address this 'digital divide between metropolitan centres and regional NSW . . . to enable world-class, affordable and resilient connectivity' , with 'modern, high speed digital networks . . . available to all'. It will support the roll-out of NSW Government programs such as the Regional Digital Connectivity program, which will 'ensure families and businesses across regional NSW have better access to mobile, internet and digital services'. 
Applications that depend on reaction times such as elements of social interaction, gaming and streamed content need a low network latency to quickly relay data, user actions and audio between the relevant parties at a speed that doesn't frustrate or disorient the participants.
Network latency depends on a number of factors including the quality of the network and the physical distance between the source and destination. Typically, latency between Sydney and Melbourne is about 0.15 ms. Australia to the US is greater than 100 ms while Australia to the UK is usually greater than 250 ms.
Acceptable levels of latency are subjective and task dependent. Dan Rampton, director of engineering for Meta, has stated that a metaverse where content could be streamed seamlessly from the data centre to a user would require a network latency of between 10-20 ms. This should be seen as a vision for the future rather than what is needed to run today's less-ambitious applications which store most of the required data in the headset. For comparison, video calls typically require a latency of around 150 ms while online gaming typically requires latency of less than 70 ms.
These low latency requirements may have consequences for NSW public adoption of metaverse technologies.
- There may be growing demand for local data centres to reduce the distance travelled by the data from the hub to the VR or AR headsets.
- There may be regions with poor network connectivity or regions located a large distance from a data centre that miss out on many of the benefits offered by this technology.
- There may be some unavoidable fragmentation of the global user base into geographical regions for activities that demand low latency between users (as has been evident within gaming communities).
Starting to address connectivity gaps
As a starting point for identifying and addressing specific connectivity gaps, the NSW Government may wish to consider:
- conducting a state-wide analysis of connectivity, in order to provide a metaverse-ready view of the state to inform investment decisions
- predicting the locations that might see greater early take-up of metaverse applications and prioritise improving connectivity at these locations (for example, remote areas using VR for remote learning)
- running metaverse application trials in areas of good connectivity to better determine performance requirements
- developing a connectivity investment plan that explicitly balances targeted investments based on the likelihood of widespread use with the need to deliver inclusive outcomes
- investigating what implications the limited 5G and fibre broadband access in remote areas has on metaverse connectivity
- ensuring that the NSW Connectivity Strategy's objective of bringing meaningful digital connectivity to all citizens and achieving metro-equivalent standards can be met in light of metaverse connectivity requirements.
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