Facebook will invest billions in ‘metaverse’ in the coming years
Facebook says it will invest at least $10 billion this year in Facebook Reality Labs, for developments around augmented and virtual reality. This will increase in the coming years. Facebook will display the financial figures of that department separately.
Starting next quarter, Facebook will provide separate numbers for Facebook Reality Labs with its quarterly results; the department that works on AR and VR hardware and software. Currently, the social network reports company-wide figures, which do not indicate how much money is being spent in the various departments.
Facebook is making that change because it says it will invest heavily in the ‘metaverse’. That is according to CEO Mark Zuckerberg the ‘successor to mobile internet’. By this he refers to a virtual environment in which people can interact. Zuckerberg has long indicated that he sees the metaverse as the future and Facebook said earlier this month it would hire 10,000 people to work on it. The investments in the metaverse will not be profitable in the coming years, says the CEO. The company is now setting up the foundations, Zuckerberg said.
This year, Facebook says it will invest about 10 billion dollars in Facebook Reality Labs and that will increase in the coming years, according to the company. The Oculus headsets and Portal screens fall under this department. More details about the investments and its vision will be announced by Facebook on Thursday at its Connect event. There are rumors of a name change of the company, which would further assist the focus on the metaverse, but nothing has been announced yet.
Currently, Facebook makes money almost exclusively from advertising. In doing so, the company is experiencing setbacks as Apple has added anti-tracking features to iOS that require users to explicitly allow apps like Facebook to track them. The company is also under scrutiny from regulators. With the investments in the metaverse, Facebook is also focusing more on hardware, as it requires AR and VR glasses to make use of it.
Facebook also wants to make internal changes to attract more young users. The social network has difficulty reaching that target group. Instagram is getting a greater focus on videos for this. Facebook wants to compete with TikTok with this.
In September, Facebook had 1.93 billion daily active users. That is 6 percent more than a year earlier. The number of monthly active Facebook users was 2.91 billion at the end of September, which is also an increase of 6 percent. The company estimates that 2.8 billion people use a Facebook service every day. Every month there are 3.6 billion. These figures also include the use of Instagram and WhatsApp.
Facebook’s quarterly revenue came in at $28.3 billion, up 33 percent from the same quarter last year. Profit was $9.2 billion, an increase of 17 percent. Converted, the quarterly profit amounts to about 7.9 billion euros.
Oculus Quest 1 and 2