After pouring billions into it, Facebook’s delve into virtual reality appears to be a secondary consideration after layoffs and poor sales.
Key Details
- Mark Zuckerberg and Facebook parent company Meta Platforms appear to be shying away from metaverse, maintaining that the service has a future but quietly shifting the core focus of the company toward artificial intelligence (AI).
- On Tuesday, the company announced another round of mass layoffs, with 10,000 more Meta employees losing their jobs.
- On March 3, Meta cut the prices of its flagship Meta Quest Pro products by 33%.
- A report from The Verge that same day found metaverse users in the Horizon World’s virtual space only retained 10% of users as regular users.
- The metaverse has consistently lost money for the company, including $13.7 billion in 2022, causing investor pushback in an October 2022 investor call.
Why It’s News
Mark Zuckerberg staked the reputation and future of his company on October 28, 2021, when he changed its name from Facebook to Meta Platforms—reflecting both an overall gradual decline in the aging social-media network and a hope that virtual reality held the future of his enterprise—one which the company has invested over billions of dollars, 20% of its investments, into bringing it to reality.
Zuckerberg’s tune has changed in the year and a half since, joining the ongoing AI arms race against Google and Microsoft and talking up the company’s investments into AI, following the greater trends of the tech industry overall.
“Our single largest investment is in advancing AI and building it into every one of our products. Our leading work building the metaverse and shaping the next generation of computing platforms also remains central to defining the future of social connection,” he mentions in a February 27 statement.
The metaverse will remain operational, and Meta’s Reality Labs will continue innovating it and releasing new hardware for the service. Still, it will likely remain a niche service for gamers rather than an innovative technology for the future of humanity.
Notable Quotes
“There will be no press release, no big announcement, as he would have to acknowledge that he was wrong. But make no mistake: Mark Zuckerberg just buried the metaverse. The metaverse is dead,” says The Street’s Luca Olinga.
“It’s costing a fortune to even attempt to build the metaverse as a place people want to actively seek out and go to, and let’s assume you achieve that miraculous goal, you then have to monetize the place so it’s actually generating revenue, which carries the risk of making it actively worse for users. Meta has tried to do both at once,” says Forbes’s Paul Tassi. “It’s pretty clear at this point there is no saving this current version of the metaverse.”
