Mark Zuckerberg, the CEO of Meta, remains optimistic about the company’s metaverse plans, despite the significant financial investment required. During a remote interview at the Nov. 30 DealBook Summit, he addressed concerns about the viability of Meta’s metaverse play and emphasized the importance of persevering through doubts.
Meta’s recent earnings report, released on Oct. 26, revealed the largest quarterly loss ever recorded in its metaverse-building arm, Reality Labs, dating back to the fourth quarter of 2020. In 2022 alone, Zuckerberg’s virtual reality venture has cost $9.44 billion, nearing the $10 billion losses incurred in 2021. However, Zuckerberg remains undeterred by the costs, believing that the metaverse is the future of computing.
Nevertheless, Zuckerberg acknowledged that these ambitious plans have had consequences. On Nov. 9, Meta had to lay off 11,000 employees, as it had made significant investments, including in hardware, to support its metaverse. The company had anticipated positive indicators from e-commerce businesses during the peak of the COVID-19 pandemic in 2021, but the reality turned out differently.
Despite Meta’s apparent focus on building the metaverse, Zuckerberg clarified that 80% of the company’s investments are still directed towards its flagship social media platforms, and this allocation will continue for the foreseeable future. Only “less than 20%” of the investments are currently dedicated to Reality Labs, but Zuckerberg believes this will change as the metaverse gains more prominence.
Within the 20% invested in Reality Labs, 40% is allocated to virtual reality (VR) headsets, while the remaining portion is dedicated to developing normal-looking glasses capable of projecting holograms into the real world. Zuckerberg also criticized Apple for its restrictive App Store policies, contrasting them with the more open platforms provided by Windows and Android. He expressed Meta’s commitment to allowing sideloading with its existing VR units and upcoming augmented reality (AR) units, and hoped that future metaverse platforms would adopt a similar approach.
Zuckerberg concluded by highlighting the potential issues associated with one company having complete control over the app experiences available on a device, underscoring the importance of openness and choice in the metaverse ecosystem.