Although the term “metaverse” was used just seven times (compared to 23 for “AI”) during Meta’s quarterly earnings call this week, the business continues to pour enormous resources towards realising its goal of a socially-connected virtual reality.
In 2021, Meta started listing the VR and AR operations at Reality Labs as a separate section. That allows us to observe the astonishing amounts of resources Meta is devoting to certain regions.
Meta’s operational losses for Reality Labs in 2022 were $13.7 billion, an increase from the staggering $10.2 billion it lost on the business unit in 2021. Last year, Reality Labs earned $2.16 billion, down from $2.27 billion the year before.
To put this in perspective, in2014, Meta spent $2 billion to acquire Oculus, a virtual reality (VR) hardware pioneer and the company’s foundation. In recent years, the corporation has increased its commitment in the field by acquiring a number of prominent software startups, such as Within, producer of the virtual fitness programme Supernatural and the inventor of Beat Saber.
Although Meta hasn’t confirmed the current size of the Reality Labs team, the team allegedly included 17,000 people before layoffs at the end of 2017. The majority of its budget is allocated to the region, with the majority of that going toward payroll and the development of new gear.
The CFO of Meta, Susan Li, has said that the yearly losses for Reality Labs are expected to increase in 2023. Li called the company’s efforts in augmented reality (AR), virtual reality (VR), and the metaverse (Metaverse) software “a long-duration investment” and promised to keep pouring resources into the field.
Later in2023, Meta intends to release a next-generation consumer headset, maybe a reimagined version of its Quest gear with mixed reality capabilities. Apple is generally anticipated to release a new AR/VR headset shortly, making it one of the few consumer-focused businesses with a chance to compete with Meta in the industry.
Mark Zuckerberg, CEO of Meta, mentioned Reality Labs and how it incorporates augmented reality (AR), virtual reality (VR), and metaverse-related software (Horizon Worlds, etc.) on this week’s earnings call. In contrast to the cost of developing hardware, “I believe the software and social platform could be the most significant element of what we’re doing,” Zuckerberg remarked.
To win over doubtful investors, Meta may downplay its metaverse efforts in public. Nonetheless, the business seems committed to continuing to develop virtual reality and augmented reality products.
So far, Zuckerberg hasn’t noticed any “signals” that indicate a need to change Reality Labs’ long-term approach. As part of our continual efforts to improve efficiency, we are always tweaking the finer points of how we go about carrying this out.
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