Meta cuts virtual universe segment, focuses on AI and wearable devices

CEO of technology company Meta Platforms Inc. Mark Zuckerberg is expected to significantly cut resources devoted to building the virtual universe (Metaverse) - an effort he once envisioned as the future of the business and a core reason for changing the company's name from Facebook Inc. to Meta Platforms Inc.

According to sources familiar with the matter, the company's leadership is considering a budget cut of up to 30% for the virtual universe development team next year, which includes the Meta Horizon Worlds virtual world product and the Quest virtual reality unit.

Sources say such large cuts are likely to result in layoffs as early as January, although a final decision has yet to be made.

A Meta spokesperson confirmed the reduction in resources for the Metaverse division, saying the company is shifting some of its investment from the Metaverse division to AI glasses and wearables due to the strong momentum in these areas.

The proposed cuts to the virtual universe building segment are part of Meta's annual budget plan for 2026, sources said.

According to sources, Mr. Zuckerberg asked Meta's leaders to find ways to cut 10% across all divisions — a standard request seen in budget cycles in recent years.

Virtual universe development teams have been asked to cut their budgets further this year as Meta finds the technology isn't facing the level of industry-wide competition it previously predicted.

Following news of the above reduction plan, Meta's stock price increased 3.4% to $661.53/share in the December 4 session.

Meta's vision of building virtual universes has yet to really take off, despite Mr. Zuckerberg's staunch belief that people will one day work and play in virtual worlds.

The team that builds virtual universes is part of Reality Labs, a division of Meta focused on long-term bets like virtual reality (VR) and augmented reality (AR) glasses, which has recorded more than $70 billion in losses since the start of 2021.

Mr. Zuckerberg has now largely stopped mentioning the virtual universe in public or on company earnings calls.

Instead, he focuses on developing large AI models that power AI chatbots and other generative AI products, along with hardware products that more closely tie into those experiences, like Meta's Ray-Ban smart glasses./.

(TTXVN/Vietnam+)

Source: https://www.vietnamplus.vn/meta-cat-giam-mang-vu-tru-ao-don-luc-cho-ai-va-thiet-bi-deo-post1081173.vnp