The Metaverse raises more and more doubts. Zuckerberg miscalculated?

In the Metaverse, even its biggest supporter, Mark Zuckerberg, is slowly losing faith.

The poor first quarter of 2022 forced Meta to make decisions

Meta’s first-quarter earnings were $7.5 billion, 21% lower than a year earlier. Revenue, however, rose 7% to $27.9 billion, the slowest growth rate since the company’s debut a decade ago. The spending target for 2022 has been reduced by US$3 billion. So the news is really bad.

The Metaverse CEO almost became obsessed with the Metaverse, and despite the company’s slowest growth in many years, he continued to invest huge sums of money in the Reality Labs division for the Oculus Quest headset and future AR headset design. It employs about 17,000 people, and the division alone lost nearly $3 billion last quarter.

Tragic results, TikTok’s dominance in the social media market, investors’ lack of confidence in the metaverse, and the slow development of the digital universe have forced the company to slow down some investments.

Source: Depositphotos

Reality Labs has seen cuts. An understandable but surprising decision

The department that deals entirely with metaverse issues has been removed. Despite Zuckerberg’s enormous fascination with the subject, his common sense prevailed at least for a while. A Meta spokesperson confirmed to Reuters that some Reality Labs projects will be postponed and others will be canceled altogether. At this time, there are no specific projects to which these reports apply.

Interestingly, however, reports suggest that no one at Meta really expected Reality Labs to succeed financially in the near term. Mark Zuckerberg would have always made it clear that the VR, Augmented Reality and Metavers departments could take almost 10 years to bear fruit.

This is particularly interesting – because if Zuckerberg and the entire Meta were well aware of this, why the sudden surprise and even outrage at the poor first quarter results and the cut of the “future” department? On the other hand, if this is Meta’s official position, it’s no surprise that investors don’t want to enter this field – few can be convinced by the argument that you can make money on it. , but you have to wait almost a decade.

Meta’s ambitions are to pay social networks

Where, then, is Meta supposed to get the money for its ambitious (and above all sky-high) ambitions? Social media…but I wouldn’t be so sure about that plan. Despite the fact that Meta includes Facebook, Instagram and WhatsApp, the latest news suggests that Zuckerberg’s business is not having the best time of its life, quite the contrary.

Some sources report that this was the company’s strategy for this year, however, following user posts in the first quarter, Meta has growing doubts about it. The profitability of this business model seems ex-Facebook an average success in the long term.

Source: Depositphotos

The finish line has changed direction and looks a bit confusing

All of these events make it seem like Meta is clearly lost in its new path. A company that was thriving in the realm of social media has completely rebounded creating the future business of the metaverse. Zuckerberg dedicated himself to this 100%, losing the top position in social media, shamefully losing to TikTok.

Metaverse, which was supposed to be a huge and revolutionary project, can’t really take off so far. Financially, the situation is even worse – and you can see that Meta is starting to have more and more doubts about it all. For now, the only question is whether the Reality Labs cut is one of many, or if it will allow Zuckerberg’s business to recover. It’s hard to say, but at this point most people feel more negative.

Source: Reuters

Featured Image: Vox

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