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Remember the Metaverse? It was conceived as a realm of the future where we navigate an immersive digital landscape through personal avatars. But the initial hype surrounding the concept has dissipated, even though Facebook CEO Mark Zuckerberg renamed the company Meta and invested $10 billion a year to make it happen.
Mr. Zuckerberg originally planned to hire 10,000 Metaverse employees in the EU alone, but luxury brands eagerly jumped on board for the lucrative opportunities in the virtual world. This enthusiasm has driven the valuation of the Metaverse economy to astronomical heights, with Goldman Sachs predicting his $8 trillion and Citi’s $13 trillion over the next 20 years.
Curiously, Zuckerberg is now more focused on AI and efficiency than the Metaverse. Meta’s Reality Labs division, which makes Meta Quest headsets, continues to lose money, reporting a $13.7 billion operating loss last year. Additionally, only a small percentage of visitors to Horizon Workrooms, the company’s flagship social space, return as regular users.
Advertising losses and significant business cuts have forced Mr. Zuckerberg to turn his attention to meta social media applications. As a result, Metaverse currently receives only his 20% of the company’s investment. Additionally, Zuckerberg’s new text-based service, Threads, appears to be separate from Powering the Metaverse and instead targeting rival X (formerly known as Twitter).
This disillusionment extends beyond Facebook. Microsoft abruptly shut down its Metaverse division just four months after it was founded, resulting in the layoff of 100 employees. Disney followed suit, shutting down its Metaverse division and laying off 50 employees. There is still considerable confusion about what the Metaverse represents, compounded by technical hurdles and widespread apathy. An astonishing 40% of organizations pay no attention to the metaverse at all.
Virtual real estate platform Decentraland recently achieved a $1 billion valuation, but the price of virtual land has since plummeted. Nevertheless, Meta remains optimistic and continues to invest heavily in augmented reality technology, aiming to revolutionize people’s lives and shape the future of computing.
But Apple’s newly released mixed reality headset is disrupting the metaverse and ushering in a new era of spatial computing, and less than two years after its grand announcement, what little investor enthusiasm remained. It looks as if it has been erased. For those still navigating the desolate landscape of Zuckerberg’s crumbling edifice, time may be running out.