The metaverse's winter doesn't seem to be over yet, or rather, Meta has finally decided to adjust its exorbitant costs of building dreams. According to...Bloomberg News reportedAs previously anticipated by the market, Meta has begun laying off more than 1000 employees in its Reality Labs division, which is responsible for virtual reality and metaverse products. According to an internal memo from Meta's Chief Technology Officer, Andrew Bosworth, the division's future focus will shift significantly towards developing AI wearable devices such as the Ray-Ban Meta smart glasses.
A strategic shift after burning through $700 billion
This news of layoffs is not surprising. Since Mark Zuckerberg's major move in 2021 to rename the company Meta and fully invest in the metaverse, Reality Labs has accumulated losses exceeding $700 billion. Although Meta's Quest series of headsets has gained some recognition in the consumer market, its profitability is clearly far from enough to fill the huge black hole of research and development and operations.
Faced with pressure from investors and the rise of AI, Meta finally had to confront reality. Its original grand vision of a "metaverse" had to be scaled back due to the lack of killer applications and lower-than-expected hardware adoption.
Embrace "Mobile Devices" and AI Glasses
According to reports, Meta's future metaverse plan will focus on "mobile devices." This refers not only to mobile apps, but also to lightweight wearable devices that are highly integrated with mobile phones.
In a memo, Andrew Bosworth wrote, "Given our larger potential user base and faster growth rate, we are shifting almost entirely our team and resources to mobile devices to continue accelerating adoption in this space." This means that, compared to bulky VR headsets, smart glasses like the Ray-Ban Meta, which combine a camera, audio, and AI assistant, are becoming Meta's new favorite due to their portability and practicality.
The VR division has become "flat," which may delay the release of the Quest successor.
As for the VR headset business, Meta has not completely abandoned it, but Andrew Bosworth pointed out that the division will operate in a more streamlined and flatter organization, and will adopt a more focused product roadmap to maximize long-term sustainability.
This statement suggests that Meta may slow down the development of high-end VR hardware. In other words, players hoping to see a successor to the Quest 3 or a higher-end Pro version update in the near future may be disappointed.
Analysis of viewpoints
Over the past few years, Meta has been trying to create a virtual world (VR) that people can "immerse" in. However, after the explosion of generative AI, they found that people need an AI assistant that can "assist" in real life. The unexpected success of Ray-Ban Meta smart glasses obviously gave Mark Zuckerberg a good way out: instead of forcing users to wear VR headsets to enter the virtual world, it is better to use lightweight glasses to overlay AI and information into the real world.
However, this doesn't mean the metaverse is dead; rather, the entrance to the metaverse has shifted from VR headsets to "AI wearables." For Meta, this is an extremely pragmatic decision, since monetizing AI is much faster than selling virtual land, and reducing Reality Labs' losses is the most direct way to improve the stock price.
