Mark Zuckerberg, Founder and CEO of Meta Group, has a plan to jump-start the growth of his business. The leader will bet everything on the metaverse and artificial intelligence. Explanations.
Interviewed by CNBC, Mark Zuckerberg believes that the metaverse will allow Meta toreap huge profits in the future. The billionaire assures that digital universes in virtual or augmented reality will represent an important part of Meta’s activities during the second half of the decade. That’s why the Facebook group renamed itself Meta last year.
By 2030, Meta’s CEO expects to find about “a billion people in the metaverse.” Several studies abound in the same direction as Mark Zuckerberg. According to a Gartner reporta consulting and research company, 25% of people will spend at least one hour a day in the metaverse by 2026.
Read also: Meta tackles harassment in the metaverse with a new option
The metaverse, Meta’s growth driver
Within the metaverse, Internet users will be invited to spend money. The founder of Facebook foresees that users buy “digital goods, digital content or different things to express themselves”. According to him, it could for example be “clothes for their avatar or different digital goods for their virtual house” or decorative objects for “their virtual conference room”. Meta has also opened a virtual clothing store for avatars.
To pay and store these digital elements, Internet users will have to turn to Meta Pay, the logical evolution of Facebook Pay. The mobile payment solution will gradually evolve to become the must-have digital wallet of the metaverse. This wallet will store both digital currencies and non-fungible tokens (NFTs). To reap profits, Meta intends to require a fee of 47.5% on every sale of a digital good on its platform. This commission mainly concerns content creators, the central element of the metaverse economy.
Mark Zuckerberg seems convinced that the metaverse will sooner or later revive the growth of his company, which has gradually contracted. During the last quarter, Meta announced a net profit down 7.5% compared to the same period in 2021. Despite an annual increase of 7%, the turnover of the firm worries investors. Worse, Facebook lost users for the first time in the last quarter of 2021.
This is why Meta has invested colossal sums in the metaverse, which is considered a growth driver. But, despite Zuckerberg’s enthusiasm, the company has been forced to cut spending on the matter. Largely in deficit, Reality Labs, the division dedicated to virtual and augmented reality, has canceled several projects in recent weeks. Meta’s connected watch project, with two integrated cameras, was notably aborted.
“It will take a while to scale to hundreds of millions, if not billions of people in the metaverse, just because things take a while to get there,” Zuckerberg admits. A few months ago, the entrepreneur had already warned the shareholders: the Reality Labs division will not generate no profits with its products before 2030.
Meta’s short-term solution: copy TikTok
To raise the bar in the near future, Meta intends to bet on artificial intelligence. The Silicon Valley giant plans to copy content recommendation algorithm which made the success of TikTok, the favorite social network of 18-25 year olds.
Meta has also announced its intention to thoroughly review Facebook’s news feed based on the TikTok interface. As Mark Zuckerberg explains, the social network will gradually abandon the system in which “most of the content you see on Facebook and Instagram”. Now, “more and more of this content will simply come from AI recommendations.” Will this fundamental change allow Facebook to escape obsolescence while waiting for the rise of the metaverse?
Source :
CNBC