Meta’s CEO Mark Zuckerberg recently announced that the company will be cutting 10,000 jobs and freezing an additional 5,000 open roles in the name of efficiency. This move follows a financially tumultuous 2022 that saw a slowdown in ad revenue and a 13% reduction in the workforce in November. It was the first time that Facebook or Meta had ever initiated mass layoffs and size reductions. The company’s push for Horizon Worlds, a virtual hang-out service inside the Metaverse not dissimilar to VR chatrooms, was met with a shrug. Zuckerberg had originally hoped 500,000 monthly active users would be on Horizon Worlds by last Christmas. That goal was shifted to 280,000 after it was reported that only 200,000 were using the service.
Meta made a loss of $13.7 billion USD last year, with its Reality Labs division recording a $4.28 billion USD loss in operation costs in Q4 alone. NFT support on Instagram and Facebook is also being dropped after an unsuccessful year of experimenting with paid cosmetics and assets on both platforms. Stephane Kasriel, Meta’s commerce and financial technology leader, has announced that Meta will instead ‘focus on other ways to support creators, people, and businesses.’
Up until now, Meta’s continual negative press has kept Zuckerberg undeterred. He has publicly insisted that the Metaverse will be the future of online socializing, going so far as to call it the ‘internet’s next chapter.’ Funding for virtual reality and online social spaces has been extensive and aggressive. As of August 2022, Meta had raised a total of $26 billion USD in funding over 17 rounds. The company has spent over $36 billion USD on the Metaverse specifically since 2019, while profits have steadily slowed. In Q3 of last year, the company made $285 million USD in revenue, almost half of that same quarter in 2021.
In a shareholder meeting in 2022, Zuckerberg said that a ‘significant amount’ of money would be lost in the next three to five years. This bullish approach reportedly angered major investors, who called Meta’s excessive spending ‘tone-deaf’. Now, with its recent layoffs and a promise to streamline operations, it seems the company may finally be starting to rethink its long-term strategy.
But why could Zuckerberg potentially be changing course? Insiders have said that Meta is turning away from its virtual reality plans and instead veering into machine learning. In February, Zuckerberg announced a new product group that will develop generative AI for the company’s existing platforms, including Instagram and WhatsApp. Meta will be researching ways to generate text, images, and other media that are comparable to human-made content.
This shift from failing virtual social spaces to artificial intelligence products isn’t all that surprising and reflects a larger turn within tech. Snapchat has integrated ChatGPT into its UI, Google is building its own chatbot named Bard, and Microsoft Bing’s own chatbot was built with OpenAI’s language models. ChatGPT and DALL-E have been at the forefront of mainstream tech conversations for the past twelve months or so. Anyone can now create unique images or text from human prompts using AI that pools from a huge database of references. This has led to countless memes, unsettling portraits of faces that don’t exist, and debate as to the moral ethics of an emerging technology that could have widespread ramifications for artistry.
Unlike Meta’s struggling Horizon Worlds, promising AI programs such as these have the numbers to back up their supposed public interest. OpenAI surpassed 100 million users in January and is reportedly growing faster than most traditional social platforms, including TikTok. In September 2022, image generator software DALL-E boasted over 1.5 million users actively creating over 2 million images a day. Meta AI is an exciting and potentially lucrative venture for Meta. It could make the company a leading player in the tech industry once again, but it also raises some ethical concerns. As AI technology advances, there are concerns about potential bias, lack of privacy, and security issues. It’s crucial for Meta and other tech companies to address these concerns to ensure that AI technology is used ethically and responsibly.
Moreover, AI also has the potential to change the way we work and live. With AI, jobs in industries such as customer service, healthcare, and transportation could become automated. This could lead to job losses for many people, which could have negative economic and social implications. As such, it’s important for companies like Meta to consider the potential impact of AI on society and work to mitigate any potential negative effects.
In conclusion, Mark Zuckerberg’s announcement of layoffs and a freeze on open roles, as well as the discontinuation of NFT support on Instagram and Facebook, reflects a shift in Meta’s strategy. The company is moving away from its virtual reality plans and focusing on AI development. This shift may be a wise move, as AI technology is growing in popularity and has the potential to be very profitable. However, it also raises ethical concerns that need to be addressed. As we move forward into an age of increased automation and AI, it’s crucial for companies like Meta to consider the potential impact of their technology on society and work to ensure that it is used ethically and responsibly.
FAQs
Why is Meta shifting its focus from Virtual Reality to AI?
Meta is shifting its focus from Virtual Reality to AI because they believe that AI has the potential to revolutionize the way we socialize online. With AI, users can interact in more natural and personalized ways, and AI-powered assistants can help users navigate the platform more easily.
What are the potential benefits of using AI for socializing on Meta?
Using AI for socializing on Meta can lead to more natural, engaging, and personalized interactions between users. AI can also help reduce the risk of online harassment and abuse, by identifying and moderating harmful content.
What are the risks of using AI for socializing on Meta?
The risks of using AI for socializing on Meta include the potential for bias and privacy concerns. AI algorithms may unintentionally perpetuate existing biases and stereotypes, and users may be uncomfortable with the idea of their data being used to train AI models.
Is shifting focus from Virtual Reality to AI a risky move for Meta?
Shifting focus from Virtual Reality to AI is a bold move for Meta, but it also presents opportunities for innovation and growth. By leveraging the power of AI, Meta can create a more engaging and personalized social platform for users. However, it is important for Meta to address potential risks and concerns associated with using AI, and to be transparent about how user data is being used and protected.
