In recent months we have heard about the metaverse ad nauseam. Most of the responsibility for this to happen rests with Meta, the company we knew as Facebook until 2021, and its founder, Mark Zuckerberg. The possibility of living a life in virtuality is more than a publicity stunt for the entrepreneur, who seems willing to burn all the chips at his disposal to make it a reality, even if it means throwing away everything they have done in the past. last 18 years.
One thing is very clear: Meta is no longer Facebook. What does this mean? That the company is no longer the social network that became all the rage in the world and that, based on that growth in reach and economy, it was able to absorb other booming players —Instagram and WhatsApp— to expand its global domain.
In the eyes of Mark Zuckerberg, Meta is the superior vision that seeks to harness the power of its various social tools to pave the way to the metaverse. However, in recent times it has been seen that it does not matter how many employees committed to the cause are under its command, nor how many billions of dollars the company has to spend at its discretion. Completely changing the destiny of a company is not something simple —something that applies to any area—, especially when betting on an intangible that could only be available in the next decade and of which the only certainty is the conviction of the person who promotes it.
That said, Facebook may have ceded the Meta priority product scepter to the metaverse, but it's still the company's most important revenue stream. However, some of Mark Zuckerberg's latest decisions seem to overlook him.
Meta is no longer Facebook, but you can't live without it
That Meta tries to get as far away from the “Facebook” brand as possible has its logic. After all, the social network has been hit hard by the Facebook Papers scandal; And while it wasn't the company's first rodeo to deal with high-profile controversies, whistleblower Frances Haugen's revelations were like a stab to the liver. The accusations of censorship, lack of action to detect and eradicate hate speech, and the absence of real measures to stop the viralization of false news, were only part of what was left by the hundreds of internal documents that were made public in the period of very few weeks. And not to mention everything that was unleashed around the toxicity on Instagram and its impact on the teenage public.
This is how the metaverse appeared as the magic potion that would reverse all the ills of Facebook and make them disappear. A recipe by Mark Zuckerberg himself, who despite the changes applied to his company continues to have the last word on everything that is cooked in it.
But Meta can't get rid of Facebook, no matter how badly it wants to. As we said before, the social network may no longer be the product with priority No. 1 but it is the one that makes the money flow. After all, digital advertising represents 98% of the company's revenue.
Yes, it doesn't matter that WhatsApp is the most used messaging app in the world; nor that Instagram is the preferred platform for adolescents and young adults; if Facebook goes down, Meta falls apart. Proof of this has been the recent 24% drop in the value of the company's shares, when it became known that for the first time in its history, Facebook lost daily active users. The blow represented a drop below $600 billion in market capitalization, something that ended up favoring Mark Zuckerberg with regulators but proved disastrous for investors.
To the metaverse, whatever it takes
So, if a company with around 70,000 employees has its revenue concentrated almost entirely in a single channel, how to pivot it to a completely different business model without throwing everything away? That is the great challenge of Mark Zuckerberg, and it is not very clear how he will approach it. No matter how confident you are in the metaverse, if you fail to create a way to generate money that is as (or more) effective than the current one, the project is doomed to fail.
And many will say that in virtual life there will continue to be ads and forms of monetization; And they are right. However, Meta has set up a data collection structure through its platforms —mainly on Facebook— that is probably impossible to replicate in the metaverse. In fact, there is already concern about the identity of users and the protection of their privacy, issues that will have to be dealt with in depth before these types of experiences see the light.
But that's not all, as there is also a greater awareness on the part of the public about what it means to hand over your data to other companies. Mark Zuckerberg was able to exploit the growth of Facebook at a time when people didn't mind putting all their personal data on the web; But now it's not that way anymore. And the more companies give their users the ability to prevent their online activity from being tracked, the worse it will be for Meta and related companies.
In addition, the vision of the CEO of Meta about the metaverse does not satisfy his employees either. At the end of last January, The New York Times reported that some employees were being almost forcibly pushed to reapply for new positions within the company, to be relocated to positions related to the development of virtual reality and augmented reality solutions. And to this has been added that almost 25% of new job searches are focused on these items.
This has caused some of the workers to directly leave the company and seek a new direction, considering that efforts were being focused too much on the metaverse.
Is Mark Zuckerberg suicidal?
Today it is very difficult to know if the obsession with the metaverse will bear the fruit that Mark Zuckerberg intends. Yes, the impression remains that the strategy adopted by the manager is tremendously aggressive for a product that will not be available for several years. And that can have a very negative effect on its finances, especially if Facebook's slide against more attractive rivals like TikTok deepens.
It is clear that they must "sell" the idea of the metaverse both to the public and to investors, but it is also a reality that today people have more important concerns in everyday life than thinking about whether in 10 years they are going to live their day to day through an avatar.
Tim Sweeney, the CEO of Epic Games, recently said that the metaverse will be capable of generating "several trillion dollars" and mobilize the world economy. It is evident that Mark Zuckerberg thinks the same, otherwise he would not have spent 10 billion dollars in the development of the metaverse during 2021 alone. But that is not a guarantee of anything.
The Facebook founder may think that in order to make billions, you also need to be willing to lose them. However, we cannot help but think that his position is —at least— reckless.