‘Metaverse’ or ‘Metaworse’ for Facebook with over 11,000 Layoffs
Dr M Rahman, Senior academician, Galgotias University
Recently, Meta Platforms Inc. (formerly Facebook Inc.) owning Facebook, Instagram, WhatsApp and Reality Labs fired over 11,000 employees, which is around 13 per cent of the company’s workforce on 9th November, 2022. It was the first mass layoff in 18-years history of Meta since 2004.
The CEO of Meta, Mark Zuckerberg took full accountability of the layoffs and said “sorry”. He justified this layoff as an inevitable action to save the company from decline. The company saw it’s revenue declining and stock price tumbling down over 70% this year, making it the worst performer of S&P 500 for 2022.
Zuckerberg mentioned multiple factors like reduced post-pandemic online commerce, macroeconomic downturn, increased competition in social media sector, and ads signal loss behind his company’s decline.
Click here to see Big Tech Companies Flourished amid COVID, Had a Blockbuster Pandemic Year
However, he failed to mention his ‘obsession and overspending in its disastrous metaverse project’ -aimed to create a virtual world in which people would live, work, shop, play and interact with others from the comfort of their home using a VR headset – behind Meta’s decline. But it has to be analyzed, whether it’s ‘metaverse’ or ‘metaworse’ for Facebook.
Metaverse or Metaworse for Facebook
Although many companies like Microsoft, Google etc. started investing in metaverse, Mark Zuckerberg has been highly obsessed with it. In October 2021, ‘Facebook Inc.’ changed its name to ‘Meta Platforms Inc.’ to chase the dream and become the leader of ‘Metaverse’ at the earliest.
Since January 2019, Meta invested a huge amount of $36 billion in its special division responsible for developing its metaverse platform.
However, due to the poor quality of its ‘metaverse’ platform, it could never able to attract enough users and suffered huge losses. Since 2019, the metaverse division incurred a loss of over $20 billion. In 2021 year alone, this company lost more than $10 billion on it, a 54 percent increase compared to 2020.
As Meta allocated billions of dollars into the metaverse project, it’s unhappy investors sent its shares tumbling more than 70 per cent since the beginning of this year. This reduced the company’s market value by over $650 billion forcing Meta undertake cost cutting measures resulting in mass layoff of over 11,000 employees.
Despite these setbacks, Meta will continue investing billions of dollars in its metaverse project. In a letter (dated November 9, 2022) to the Meta employees, Zuckerberg mentioned his commitment in ‘developing the technology to define the future of social connection’. However, many global business heads are apprehensive of the future of metaverse. According to the CEO of tech giant Apple Inc., “The metaverse isn’t the future, because people don’t understand It”.
Do you also think Meta played a gamble by focusing too much on ‘metaverse’ concept of future, rather than fixing other issues in its products? Is it ‘metaverse’ or ‘metaverse’ for Facebook?
External links
https://about.fb.com/news/2022/11/mark-zuckerberg-layoff-message-to-employees/
https://www.news18.com/news/explainers/why-zuckerbergs-meta-has-sacked-11k-employees-what-will-happen-to-indian-workers-now-explained-6346759.html
One thought on “‘Metaverse’ or ‘Metaworse’ for Facebook with over 11,000 Layoffs”
Wonderful insight.