Mark Zuckerberg has started delivering on his promise to make 2023 a ' year of efficiency.'
Mere months after its last large-scale layoff, Met a is putting another set of jobs on the chopping block. The parent company of Facebook and Instagram will cut thousands of employees as soon as this week, Bloomberg reported, citing people familiar with the matter.
Since mid-2022, Meta has been struggling to reel back costs. It spent too much, too quickly, on its big metaverse dreams while ad revenue slid due to a macroeconomic downturn and increased competition. A $12-a-month subscription for blue ticks won't be enough to make up for it all.
A brief timeline of Meta's jobs shuffle
November 2022: Meta trimmed its workforce by 13% last November, when it slashed 11,000 roles to save costs and increase efficiency. It was the first time since Facebook was founded 18 years ago that the company announced mass layoffs.
January 2023: Meta rescinds full-time offers made to a 'small number of candidates' while it readjusts hiring priorities—a cut of this kind is a first for the company. Engineer and writer Gergely Orosz tweeted that the decision affected around 20 new grads in London with offers due to start in February.
February 2023: Meta begins to 'flatten' its organizational structure. Managers and directors are asked to transfer to individual contributor jobs, which are non-managerial positions that focus on coding and designing. It delays setting up budgets for the team as it plans to lay off more people.
Culling the Metaverse
Besides all the payrolls, there's another massive black hole that's been sucking Meta's money: the metaverse.
Just after the pandemic, when everyone was working, living, and breathing online, Zuckerbeg floated the metaverse as the next big thing and touted Facebook as its leader. He went all in to create an immersive world that can be accessed through virtual reality (VR) headsets and special glasses—albeit a slightly creepy world of floating torsos. It led to a brand and name change, and gobbled up billions of dollars in investment.
But it didn't quite catch on.
Horizon Worlds was not used by anyone, despite Zuckerberg's claims that it was better. Meta made it less accessible by making it available. Zuckerberg may be wrong to believe he can tap into the market of 13-17-year-olds to make the product successful. The US Senate is opposed to the idea of opening the platform to teens.
Zuckerberg is quietly killing the metaverse and pivoting to a 'new top-level product group at Meta focused on generative AI to turbocharge our work in this area,' as he wrote in a Feb. 27 Facebook post —the same day OpenAI teased dialogue-based ChatGPT. The team building AI-powered products is led by Ahmad Al-Dahle, who'll report to Facebook Meta's chief product officer Chris Cox.
Facebook's focus on ChatGPT-like AI
Last month, on Feb. 24, the company introduced a new large language model called LLaMA, short for Large Language Model Meta AI. It's the core software of a new artificial intelligence system, which entails mining vast amounts of text in order to summarize information and generate content.
'In the short term, we'll focus on building creative and expressive tools. Over the longer term, we'll focus on developing AI personas that can help people in a variety of ways,' Zuckerberg wrote in his post.
The most prominent remnant of the metaverse that is left is the hardware, the headsets. These are meant for crypto enthusiasts and gamers.
Quotable: Meta has ruined the Metaverse mission
"It's flabbergasting that people with so much resources can so spectacularly ruin things when the opportunity is there to do something cool," - Celia Pearce (a Northeastern professor of game design who has been studying nongame virtual worlds ever since the mid-90s on the Metaverse Failure.
Meta's dashed Metaverse dreams, by the digits
42%: The percentage of Meta employees polled in October 2022 that did not grasp and internalize the company’s metaverse vision.
$24 billion: Cumulative loss amassed by Reality Labs, the division housing metaverse projects, in 2021 and 2022. Of this, $13.7 billion was last year's loss, which grew from the year before.
'About 80%...a little more': Meta's investments going towards the core business, namely its family of apps—Facebook, Instagram, WhatsApp, Messenger, and the ads business associated with that.
'A little less than 20%': Meta's investment goes towards Reality Labs, as told to The New York Times Dealbook conference last November.
275%: How much more expensive Meta's Quest Pro VR headset was that its predecessor Quest 2 at $1,500 when it launched five months ago
$1,000: The price of Meta's Quest Pro VR headset fell 33% in the US and Canada as of Sunday (Mar. 5) as Meta brings it in line with competitors like HTC Vive XR Elite. By March 15, other markets are due to follow suit
$30: The difference between the low-end, 128GB version of the Quest 2 headset at $400 and the expanded-storage 256GB Quest 2 headset, which is now retailing at $430 instead of $500
20 million: Units of the Quest line sold to date, but how often are they being used? Meta Vice President for VR Mark Rabkin reportedly told employees that 'the newer cohorts that are coming in…they're just not as into it.' Maybe the thinner 2024 variant at 'the most attractive price point in the VR consumer market' will make it more popular.