So... 6 months ago, Facebook did something that very few companies in the world of business has ever done. They changed their entire business philosophy and mission, pivoted a $700 billion dollar company into something that does not exist currently. We are talking about the metaverse and why FB rebranded themselves to META.. In 2021, Meta reportedly spent $10B on Facebook Reality Labs, the metaverse division at Facebook. But why the huge shift?
Let's take a look at what happened last year.. Facebook built one of the most amazing money machines the world has ever seen. Then Apple came and threw a wrench in the gears last year.. In Q1 earnings this year, Facebook revealed that changes Apple made that affect how ads work on iOS apps — namely, that it’s now much harder for app-makers and advertisers to track user behavior — will cost it $10 billion in revenue this year.. That's not even it.. Meta lost 1M daily active users in a quarter (wiped out about 20% of its value) - Worst facebook performance on record on the stock market. You could say there was a much needed change to keep people excited about Facebook.
While Facebook put the metaverse on center-stage, it is far from the only big tech company investing in the ‘verse. Facebook cannot build the metaverse alone.. and it hasn't been. Microsoft started building it’s own ideas around the metaverse more than 5 years ago... and Azure will play a huge role in its future. Microsoft also happens to be a juggernaut in the gaming space.. which is the foundation of the current ideas of the metaverse. Keep in mind, Microsoft also is in the process of acquiring Activision Blizzard..
But could the big unlock here be gaming? At THC today we break down how we believe metaverse will just be an extension of what gaming is today!
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