2022 has been far from being the best year of Goal. The economic results have been meager, his share price plummeted 65% and Mark Zuckerberg had to lay off thousands of employees. And while many point to the dogged focus on the metaverse as the root of all evil, those in Menlo Park have ratified their commitment to virtuality for 2023.
Andrew Bosworth, Meta’s chief technology officer and leader of Reality Labs, addressed the issue on the company’s official blog. The title chosen for the article Why we still believe in the future (Why We Still Believe in the Future), makes it clear that Californians’ stance toward the metaverse will not change. At least as long as the corporation’s other divisions—Facebook, Instagram, and WhatsApp—remain profitable.
As the executive mentioned, 20% of Meta’s investments during 2022 went to Reality Labs, the branch in charge of the metaverse and the virtual reality glasses Meta Quest. And he hinted that in 2023 he will continue along the same lines. “It’s a level of investment that we think makes sense for a company committed to staying at the forefront of one of the most competitive and innovative industries in the world,” he remarked.
In addition, Bosworth spoke of the “disastrous consequences” of short-term thinking in companies. A message that seems tailor-made for Meta shareholders, who have been especially critical of Mark Zuckerberg’s management, due to his resounding turn towards the metaverse.
Beyond the lunge towards the detractors of “waste” in the development of virtual platforms, the executive tried to be conciliatory. Although he promised keep looking for a more efficient way of working, assured that Meta will not negotiate his vision and his efforts in the metaverse. But not only focusing on virtual reality, but also on augmented reality.
“While we’ll continue to find ways to work more efficiently, what won’t change in 2023 is our vision and the long-term research effort we’re putting in to get there. Building true augmented reality headsets will require a massive set of breakthroughs and inventions in all sorts of areas, from miniature lenses and displays to lightweight materials and AI-powered interfaces.While our VR headsets and software get the lion’s share of public attention, we’re driving about half of our operating expenses from Reality Labs towards our augmented reality initiatives. This means one of the most ambitious research and development operations in the world today, focused on building a new type of computing platform.”
Andrew Bosworth, CTO of Meta and leader of Reality Labs.
Meta does not negotiate its push for the metaverse
Although from the beginning the focus on the metaverse generated more doubts than certainties, the fiercest criticism against Meta came after the financial results for the third quarter of 2022. The 52% drop in revenue, added to the increase of 20 % YoY of Costs, angered shareholders. Especially when it became known that Reality Labs had lost another $3.7 billion in the quarter.
The division dedicated to virtual reality and the metaverse lost almost 9,500 million dollars in the first 9 months of 2022. A trend that has been going on since 2020, and which until last April had already cost its parent company more than 20,000 million dollars .
Not for nothing, shareholders asked Mark Zuckerberg to stop burning money in the metaverse. The company Altimeter Capital Management went so far as to request that investments in Reality Labs be limited to no more than 5,000 million dollars annually. “Meta needs to get in shape and focus”he had assured.
Regardless of what Andrew Bosworth and himself say ZuckDiscontent with the metaverse isn’t just outside of Menlo Park. The company’s own employees have expressed their discontent with the push towards life in virtuality. To the point that one even said that this bet will be the “slow death” of the company. “All the leaders want to do is follow a pipe dream for the metaverse, which is poorly executed (bottom up) and without any real direction,” said another.
While all this is happening, another point of conflict opens up for Meta: the regulatory. It is that the American company does not want governments to regulate the metaverse. Why? Because they consider that issuing laws now would be an obstacle to innovation.