November 2022 has proved to be a particularly difficult month for Meta, the parent company of social media platform Facebook, and its Chief Executive Officer. On 9 November 2022, Meta laid off 11,000 employees, aka Metamates, amounting to 13 percent of its workforce. During that same month, the net worth of Meta founder and CEO Mark Zuckerberg dropped to a mere $34 billion, from $142 billion in September 2021, and Meta, valued at $1 trillion last year, lost around three-quarters of its valuation as its share prices continued their downward plunge. Meta appears to be embarking on a path of self-destruction as its CEO ploughs massive resources into the Metaverse to little effect, just as social media activity is declining and advertising revenues are falling at Facebook.
Back in July 2021, Mark Zuckerberg referred to a “transition from people seeing us as primarily being a social media company to being a metaverse company”. Shortly thereafter, a division focused on the Metaverse was set up and the head of the Facebook Reality Labs, which took over responsibility for the new venture, was promoted to Chief Technology Officer. In keeping with this change in direction, Facebook was duly rebranded as Meta Platforms Inc. on 21 October 2021.
Metaverse represents the extension of the concept of a parallel world that was first described by science fiction writers. The first virtual world was created as part of video game in 1978 by Rob Trubshaw and Richard Battle at the University of Essex and came to be known as Multi-User Dungeon I (MUD1). Multi-player video games can thus be considered precursors of the Metaverse, a word which first appeared in Neal Stephenson’s 1992 science-fiction novel ‘Snow Crash’, in which human-controlled avatars dominated the world. The advent of the Internet was to set the scene for the Metaverse as we recognise it today.
The Metaverse is an online, immersive, and expansive virtual 3-D environment, still in development, which is sometimes presented as the next iteration or version of the Internet. It provides an embodied environment in which avatars (electronic images of users) can meet, play games, party, shop, learn from and trade with other avatars, interact with objects, travel (teleport) to distant locations, and even own property and digital assets (non-fungible tokens) in the virtual world. This parallel universe is enabled by virtual reality, augmented reality, high-speed Internet connections, high- fidelity images, and a digital infrastructure based on blockchain technology. The Metaverse can be accessed either via a dedicated website on a computer or mobile device, or through a virtual reality (VR) headset or augmented reality (AR) goggles. Unlike the HTML protocol for the Internet, the Metaverse lacks an industry standard for connecting virtual worlds- yet interoperability between these domains is essential to its eventual success. Metaverse’s social platform, Horizon Worlds, has been criticised for its underwhelming graphics and far from “photorealistic” avatars, thus attracting only low numbers, amounting to around 200,000 monthly active users.
The Meta story has its beginnings in the early 2000s. On 4 February 2004, Mark Zuckerberg, a psychology and computer science student in his sophomore year at Harvard College, launched thefacebook. com, shortly after his first venture, facemash.com, was shut down by university authorities for alleged security and privacy violations. His new social networking site allowed Harvard users to enter their personal details to create online profiles, share their interests, provide their photos, and give contact information to connect with their peers. The following month, access was expanded to Columbia, Stanford, and Yale universities. Zuckerberg then dropped out of Harvard and moved operations to Palo Alto in California’s Silicon Valley in June 2004. Backed by venture capitalists, the network widened its reach in stages before opening to anyone aged over 13 and with a valid email address by September 2006. The company’s name was shortened to Facebook with the purchase of the facebook.com domain in August 2005. The user interface evolved, new features were introduced, and major acquisitions followed. Facebook acquired Instagram, the photo and video sharing platform, for $1 billion in April 2012. The company was floated on the New York Stock Exchange on 17 May 2012, in one of the largest IPOs (initial public offerings) in American history, with a valuation of $104 billion. In 2014, Oculus VR, a producer of virtual reality headsets for video games, was purchased for $2 billion, and the WhatsApp messaging platform for $19 billion.
In recent years, Facebook has lost some of its initial attraction and its younger Gen Z users have continued to switch to competitors such as TikTok and Snapchat. Its attempt to launch a cryptocurrency, known as Libra, had to be called off in June 2019, within hours of its announcement, in the face of widespread opposition from governments and financial regulators around the world. Facebook’s business model has relied heavily on monetising users’ data. When users of Apple’s new iOS 14.5 version, released in April 2021, were opted out of browser data sharing with Facebook and others apps, Facebook lost an estimated $10 billion in revenues from targeted advertising. To regain the initiative, and maybe because of a loss of interest in his social media platform, Zuckerberg has turned his sights on the much bigger potential rewards of the projected latest version of the Internet. It cannot be overlooked, however, that he is not alone in his quest and that many other tech titans have also entered the fray.
It remains unclear how the Metaverse, however exciting it may sound, will add value to and enhance society as a whole. Setting aside the real world and spending more of our work and leisure time in a contrived virtual society may not necessarily enhance our social relationships and make us happier and more creative in the way its proponents seem to be predicting. The digital world has so far failed to deliver on such matters as the security of private data, the safety and happiness of its users, the validation and moderation of user-generated online content, the spread of misinformation, and so on. The Metaverse has a long way to go to reassure us of its commitment to reverse these trends while simultaneously promising a digital utopia. It is also disappointing that despite the massive resources already poured into the Metaverse, the product so far has proved unenticing to the world’s discerning digital users.
Ashis Banerjee