According to insider reports obtained by Reuters it seems that Meta’s run of bad news shows no immediate sign of abating. In what’s fast becoming an “Oh dear, poor Meta” weekly series, Mark Zuckerberg recently spoke with staff to allay worries in a company meeting (while simultaneously ramming them home and making them all the more real).
In brief, the now familiar message being span out (again) is that while there IS a golden age around the corner (requiring all of us to buy their hardware and leap happily into the world they’ve monetized for us) it’s actually miles away, and they’re going to have to spend more billions for it to exist in any kind of way that spends any kind of chance of recouping its investment.
It’s a wobbly predicament to be in right now as – to sum it up in equally brief terms – in the present global climate there are not many cash-rich investors sat on a pile of cash seeking a long term ‘win’.
Meta ‘predict’ an economic downturn
‘Highlights’ of the report are that Meta has reduced its engineering hires by 30% this year (down from 10,000 new jobs to around 7,000) in light of it sensing an economic slowdown… Good spot…
To quote Reuters insider report: “If I had to bet, I’d say that this might be one of the worst downturns that we’ve seen in recent history,” Zuckerberg told his workers. And – bad news, guys – it seems that rather than continue to spend their way through the problems in getting their Metaverse out there, simply “turning up the heat” on performance management will achieve their goals for now.
In other words: Thanks for all your hard work… Now work harder.
“Realistically, there are probably a bunch of people at the company who shouldn’t be here,” Zuckerberg added candidly, proving that man management continues to be a strong point. “Part of my hope by raising expectations and having more aggressive goals, and just kind of turning up the heat a little bit, is that I think some of you might decide that this place isn’t for you, and that self-selection is OK with me,” he said. Seems that the famously brusque (but ultimately game-winning) Steve Jobs has a lot to answer for.
But it’s not all bad news… Ok… It is
Backing up the Zuck was Chief Product Officer Chris Cox who set the scene prior to the meet via the company’s internal discussion forum Workplace by writing “I have to underscore that we are in serious times here and the headwinds are fierce. We need to execute flawlessly in an environment of slower growth, where teams should not expect vast influxes of new engineers and budgets.”
The desire to stem Meta’s cash hemorrhage is obvious, yet it’s a mixed message as in the same memo Cox noted that Meta would need to increase the number of GPUs in its data centres “fivefold” by the end of the year to support its “discovery” push, as Meta ramps up to please dwindling users and introduce them to the goodies just around the corner; AKA successfully launching its mixed-reality headset (code-named Cambria) in the second half of the year.
It’s a tricky situation to be in. Spending continues to go through the roof, daily active users are down for the first quarter ever and the value of the company has halved in this year alone.
While what we’ve seen from Meta is very impressive and their stance and passion hugely admirable, we have to worry about the short-to-medium term prospects of their bold ‘all or nothing’ metaverse bet.
But in the meantime: Spend less. Work more. OK?