The physical world strikes back

The Iran war is a reminder that geographic facts rather than digital tech shape our lives.

Reports indicate that Mark Zuckerberg is losing interest in the metaverse. “Both users must be devastated” is one of the tarter reactions doing the rounds. To remind readers — how telling that I need to — the metaverse is a virtual world in which people interact as graphical representations of themselves: as “avatars”. Who was ever going to choose it over real life, even for an hour, beats me. But the tousle-haired one was so devoted to the idea as to rename Facebook after it in 2021.

He can blame the zeitgeist, at least. There was a wider belief around then that physical reality was becoming less important. In Britain, the techno-utopian case for leaving the EU was that territorial distance no longer counted for much. Australia could be as natural a trade partner as Spain.

If some good comes of the war in Iran, it is that all such talk will struggle to receive a hearing for a while. To slip into Thiel-ese for a moment, what we are witnessing in the Gulf is the victory of “atoms” rather than “bits”. It is the reassertion of the material world. Geologic forces put fossil fuels in the Middle East and created the aperture now known as the Strait of Hormuz. There is still laughably little that anyone can do to get around these hard facts. And not just these ones. Investors are surprised that quite sporadic attacks on commercial ships and their personnel are enough to stop them. But human beings tend to have just the one body and to feel some attachment to it. “Disrupt” that.

The decade is turning out to be an education in the importance of the three-dimensional. Circa 2020, smart people were sure that working via Zoom was as productive as office life (the evidence since the lockdown has become more mixed) and that “soft power” could keep a continent safe. Come to think of it, of all the huge bets that have been made on non-physical projects, the metaverse — which survives in fragmented and humbled form — is far from the most disastrous. The Zuckerberg of Horizon Worlds is a less diminished figure than the Angela Merkel of peace-through-trade and a neglected Bundeswehr.

A decade that promised to have us living via avatars now feels all too tangible

Last month, some fund managers were being called in for super-awkward chats with their investors. The markets, which had expected a quick and contained war in Iran, were not positioned for so tenacious an Islamic Republic. Why? The classic inability of the business-minded to “price” fanaticism, or even to accept that such a thing exists, is one reason. But another might be generational. Perhaps a financial cohort that was reared in the digital age just could not fathom how much of life still hinges on immutable geographic facts. For those who missed the Opec crises, there has not been another reminder on that scale for half a century.

Well, expect some more. Even this decade’s great breakthrough in the “bit” sphere — AI — has become a quest for (physical) data centres and the (physical) energy that fuels them. In the fight to be the “third” AI power after the US and China, Britain’s edge is its native and imported brainpower. Having attended some expert gatherings — so that you don’t have to, reader — I fear that Canada’s sheer mineral abundance will tell in the end.

A month after Facebook became Meta, US intelligence detected a strange build-up of Russian armed personnel on the border with Ukraine. The war that has raged there ever since is about (physical) territory. Russia can afford to keep fighting because of (physical) energy exports. In retrospect, October 2021 might have been the last time that a major entrepreneur could sketch out a post-material future without seeming to have his head in the clouds. A decade that promised to have us living via avatars now feels all too tangible.

Look around. In Britain: dawning acceptance of the nation’s inescapable Europeanness. In Germany: not just rearmament but the prospect of conscription. In much of the globe: competition for scarce oil cargo. Bit by bit, so to speak, people are learning to treat the world as a physical object, which is wise, as no other terms were ever on offer.

© 2026 The Financial Times Ltd. All rights reserved. Please do not copy and paste FT articles and redistribute by email or post to the web.

This Financial Times article was legally licensed by AdvisorStream