How Meta flunked its first year as a metaverse company

Last year, the meta was riding high on the metaverse. The company recently completed its rebranding from Facebook to Meta. The social network, as Mark Zuckerberg explains, is no longer the company’s only focus. “From now on, we’re metaverse-first, not Facebook-first,” he said.

Now, with Meta ending its first full year as a “metaverse company,” the outlook is much less bright. The company lost billions of dollars to Reality Labs, the division that runs the metaverse. Its stock has craters. It was the first time that the company had mass layoffs. Even longtime shareholders have begun doing things that were once unthinkable. That is to question Zuckerberg’s vision for the future.

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At the same time, Meta hasn’t said exactly what the metaverse is, or effectively made the case for why billions of people today who use social media apps want to be a part of it. “The embodied Internet” goes even further. The company’s initial metaverse product proved to be ineffective. and turning the metaverse into a specific content instead of being a source of anticipation

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Meta and Zuckerberg have proposed a variety of definitions last year. The metaverse is “the successor to the mobile internet” and “the embodied internet where you are in the experience.” It’s virtual reality. It will also link to our existing social graphs on Facebook and Instagram, but unlike Facebook and Instagram, it can integrate with third-party platforms. It might have something to do with NFT and web3.

“The peculiarity of the metaverse is that you feel like you belong to another person or place,” Zuckerberg said during an interview at SXSW in February. “You may look at the document. You may view the website But what will you be like in the future? in it.”

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Zuckerberg might think this explains the beginning of a grand vision for the Internet of the future. But it sounds a lot like old fashioned virtual reality. Moreover It is saying that one of the examples he used was “Document viewing” in the past year The company has focused on Horizon Workrooms, a social VR experience aimed at office workers.

Meta's is integrating Zoom and Microsoft Teams into VR meetings with Horizon Workrooms.


When the company launches its new high-end Quest Pro The company introduced Horizon Workrooms as one of the core experiences optimized for the new headset. Now you can create an entire virtual workspace in VR, and soon you’ll be able to use a plethora of office and productivity software, from Zoom to Microsoft Word.

But the idea of ​​working in VR with a headset on your face is far from appealing to most people. And there are very few jobs and industries where working in VR is even remotely proven.

Perhaps most telling is that Meta is trying to persuade employees to use Workrooms, even making the Quest 2 headset free for all employees last year. But Zuckerberg’s recent push for teams to start hosting meetings in VR revealed that many people either didn’t take advantage of the offer or didn’t set up their headsets. The New York Times report

Without a clear vision It’s too easy for Meta’s critics to get caught up in issues with aesthetics and other issues. For now, the closest thing Meta has to the “metaverse” is Horizon Worlds, a social VR playground where users have the freedom to immerse themselves in virtual reality. Exploration as their avatar But the hands-on experience is different from the tweaked videos and demos that Meta shares.

This was never more evident than when Zuckerberg vigorously posted screenshots of his avatar in front of the Eiffel Tower and Sagrada Familia in Barcelona to celebrate the launch of Horizon World in France and Spain. The screenshots are comically awful and quickly take on a life of their own as people mock. “1995 class graphics”

Mark Zuckerberg's Horizon Avatar


Zuckerberg promises new and improved avatars quickly. and showing a more realistic image of himself, saying that “the graphics in Horizon can go beyond that” (A. post on LinkedIn, which has been deleted It was later revealed that the “improved” Zuck avatar took about a month and “40 iterations” to complete.

Then, at the company’s Connect event, Zuckerberg promised an even bigger advancement: legs. Soon, the legless avatar of the cartoon Horizon will soon be replaced by an avatar that resembles an actual walking human. We watch Zuckerberg’s “full body” avatar walk around Horizon Worlds, but while at first thought to be a turning point Adding leg tracking to VR is a very tricky problem. But it turns out that this demonstration was more of a platform than an actual innovation. The company later confirmed that the demo was built with motion capture and not live VR

Meta still says its avatar will eventually have legs. But it’s unclear when or if this feature will look like a demo.

It’s impossible to ignore that Zuckerberg’s metaverse pivot is in line with the company’s worst financial performance in recent memory. Meta’s revenue has fallen for two straight quarters for the first time. Its stock has lost more than 60 percent of its value this year, wiping out billions of dollars in value.

To be honest, the metaverse isn’t entirely wrong. Apple’s anti-tracking changes to iOS hurt the company’s advertising business. And the entire industry is reeling from the recession that has affected even the tech giants.

Meanwhile, Meta is undeniably losing a lot of money on its metaverse investments. Reality Labs posted a $10 billion loss in 2021 and a $9 billion loss in 2022 in the third quarter. Those losses are expected to “Significant increase” in 2023, according to the company’s CFO.

Mark Zuckerberg on what is likely to be the company's new VR headset.


So it’s no surprise that meta investors are starting to question whether the whole metaverse is worth it. Altimeter Capital’s longtime Meta shareholder, CEO, made headlines when he wrote an open letter to Mark Zuckerberg earlier this year. past It called the company’s metaverse investment “massive and terrifying. Even by Silicon Valley standards.”

In the company’s latest earnings call, Zuckerberg frequently asked some quick questions about the company’s advertising business. One analyst also raised the issue of “Experimental Betting vs. Proven Betting”

“I think everyone wants to hear why you think this is worth it,” he asked. Zuckerberg, who looked a little confused by the question, replied, “The metaverse work is a long-term endeavor that we’re working on. But I think it will end up working.” He said patience will be rewarded.

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