Mark Zuckerberg's Metaverse faces over $20 billion setback

Meta Platforms' Metaverse venture faces a daunting $25 billion setback as VR enthusiasts criticize the Meta Quest 3 headset. Find out how this high-stakes virtual reality venture is faring amid setbacks.

| Updated on: Oct 30 2023, 12:15 IST
Mark Zuckerberg
Mark Zuckerberg's ambitious Metaverse venture faces a $25 billion setback as Meta Quest 3 draws criticism. (Lex Fridman/ YouTube)
Mark Zuckerberg
Mark Zuckerberg's ambitious Metaverse venture faces a $25 billion setback as Meta Quest 3 draws criticism. (Lex Fridman/ YouTube)

In a virtual interview, Mark Zuckerberg wowed audiences with the latest developments in hyper-realistic 3D avatars set against the backdrop of the Metaverse. However, the grandeur of these advancements does little to overshadow Meta's staggering loss of $3.74 billion in its Reality Labs division during the third quarter of this year. As the company grapples with these financial setbacks, Zuckerberg's response has been to trim down the workforce within the research units responsible for virtual and augmented reality hardware and software.

Meta has been at the forefront of developing tools for virtual reality, including the Meta Quest headset and Spark AR Studio, a Facebook-backed toolkit for augmented reality projects. They have also delved into the realms of artificial intelligence and machine learning.

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Investor Confidence Remains Shaky

With things not going as per plan, Meta has resorted to layoffs. The exact number of layoffs remains undisclosed, but the company may have let go of approximately 21,000 employees since November 2022, according to a Notebookcheck report. The reduction in the workforce is a strategic move to instill confidence in investors regarding the cost-efficiency of Reality Labs, even as the division faces declining revenues. Nevertheless, losses have accumulated to an astonishing $21.3 billion since August 2022.

Furthermore, Meta's VR experiences and headsets, which were expected to generate huge amounts of revenue, have come under fire from some users who find them incomplete and unwieldy.

Notably, Meta's attempt to make a splash in the virtual reality arena included giving away the high-end Quest Pro headset, valued at $1,500, to all attendees at the Roblox RDC23 conference last year. Now, the Quest 3, priced at $500, is poised to enter the market, with high hopes for an improved experience. However, avid VR fans on platforms like YouTube, Twitter, and Reddit have expressed their discontent with the headsets, particularly their audio capabilities, which Meta is expected to address.

Recent technological advancements have garnered attention, particularly the groundbreaking "first interview in the Metaverse," as coined by podcaster Lex Fridman. These lifelike avatars are the product of sophisticated software that incorporates 3D modeling, complete facial scans, and full-body scans, hinting at the potential yet to be unlocked within the virtual realm.

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First Published Date: 30 Oct, 12:06 IST