The Disney corporation has begun backing away from the metaverse—firing its entire development division, in its efforts at cost savings.
Key Details
- CEO Bob Iger is in the process of restructuring the Disney corporation and eliminating 7,000 jobs over three rounds of layoffs.
- The company’s internal metaverse team, with 50 employees dedicated to using the company’s brands to tell interactive stories within new technologies, is among the layoffs, with nearly every employee being let go.
- The division was started in February 2022 and led by former SVP of consumer experiences and platforms Mike White.
Why It’s News
Once bullish on metaverse, Disney is beginning to see the metaverse as redundant as the technology’s rollout has continuously slowed and dampened enthusiasm for virtual reality technology.
As we previously reported, Mark Zuckerberg and Facebook’s parent company Meta Platforms appear to be shying away from the metaverse, maintaining that the service has a future but quietly shifting the core focus of the company toward artificial intelligence, despite renaming the company in October 2021 after the technology they hoped would revolutionize the world.
The slow public embrace of the technology has seemingly turned the technology into a niche product, retaining a small percentage of active users. At the same time, the company drops the price of its virtual reality goggles. Meta’s Reality Labs division ran an operating loss of $13.72 billion in 2022.
This decline has made metaverse innovation dead weight for Disney, which has felt the pressure to restructure its business model radically, focusing on profitability after a year of severe losses.
The decision marks a change in rhetoric from Iger, who previously said, “we have an opportunity to connect those universes and create an entirely new paradigm for how audiences experience and engage with our stories… This is the so-called metaverse.”
