Meta (Photo: ShutterStock)
In mid-March, Meta, the parent company of Facebook, Instagram and WhatsApp, announced its intention to lay off another 10,000 employees, as part of what is known as Meta's "year of efficiency", during which the company cuts expenses, and this against the background of a continuous decrease in the company's revenues from digital advertising and the increase in interest rates.
The company's founder and CEO Mark Zuckerberg wrote, as usual, a long and tedious post on the matter, but besides the announcement of the layoffs, another clear message to Silicon Valley and Wall Street was reflected in the text: artificial intelligence is now as important to the company as the Metaverse. A quick look at Zuckerberg's Facebook post announcing the layoffs indicates
, Without much sensitivity, it must be said how important AI is to the future of the company. While talking about how Meta invests in future technologies, Zuckerberg said, "Our biggest investment is in advancing artificial intelligence and building it into each of our products."
Zuckerberg's post
Meta hopes that developing its own AI capabilities will get it back into the good graces of Wall Street, and get it the capital it needs to advance its metaverse ambitions in the coming years.
Although Zuckerberg mentioned work on the Metaverse twice in his statement, it was only after talking about the company's AI efforts.
"We work on a wide range of cutting-edge technologies and then distill that into inspiring products that improve people's lives," Zuckerberg wrote.
"We are investing in AI to help you express yourself creatively and discover new content, with the Metaverse to provide a realistic sense of presence, with new media formats to create richer experiences, with encryption to allow you to communicate privately in more ways, and with tools Businesses that will help reach customers, create opportunities and grow the economy."
Or in a free translation: we want to create a user experience so innovative and bombastic that even we don't know exactly what it will look like and there is no chance that it will be ready in the near future, so to stay relevant we divert attention to directions that we know are currently in demand, even if they are not Consistent with our previous statements.
Zuckerberg follows trends
Part of the reason for this turn in meta goals is the hype around text generators, which was ignited by ChatGPT and got all the tech giants on their feet.
Microsoft, which purchased OpenAI for $10 billion, is now integrating it into its search engine, and Google, which rushed to launch BARD ahead of time and thus exacerbated the decline in the company's stock, is rapidly losing its position as the world's leading search engine.
The other half of this equation is related to Meta's need to continue competing with TikTok, which also makes considerable use of artificial intelligence technologies in its content recommendation engine.
While TikTok faces its own existential issues, including a potential ban by the Biden administration, Meta is working hard to catch up in the technological gap in front of it.
"One thing that's very clear is that AI and the Metaverse are front and center for Meta's long-term strategy," Forrester VP and head of research Mike Proulx told Yahoo Finance. "But here and now, there's a limit to what one company can do."
When you make bombastic statements, you have to deliver the goods
Meta was stung for its massive investments in Zuckerberg's plan to make the company the pioneer of the Metaverse.
This involved extensive research and development, from the VR/AR hardware to the software that would run the apps.
To set the record straight, only in the second quarter of 2022, the work on the project, known as Reality Labs, cost Meta approximately 2.8 billion dollars, which was invested, among other things, in the purchase of startups and the development of VR equipment, in an attempt to catch up with the technological gap with other media giants such as Apple , Google and Microsoft.
And yet, despite the inexhaustible investment, it seems that the company's virtual reality glasses, which are the project's current flagship product, are still far from becoming mainstream among consumers.
In 2021, Meta reported a loss of $10.1 billion for its investment in Metaverse.
In 2022, that number jumps to $13.7 billion.
A greater emphasis on artificial intelligence, allows Meta to appease the investors breathing down Zuckerberg's neck, and to continue plowing the field of Metaverse in the hope that one day it too will bear fruit, knowing that it may take years, if at all.
Gene Munster, managing partner of Deepwater Asset Management, recently wrote: "The NFT experiment is gone. Further investment will be made in AI to improve Reels recommendations and ad measurement tools, adding large language model (LLM) messaging features, and automation of advertising campaigns with the creation of creative content".
In other words, meta is once again abandoning investments of millions in favor of the next trend.
On the other hand, despite the declarations of investment in AI, it is in no hurry to part with the Metaverse.
While there is no doubt that artificial intelligence will benefit society, this attempt to catch all the eggs in one basket could cost the meta dearly.
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