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Facebook has dedicated a $50 million fund to developing the metaverse. While the fund is allocated for exploring and researching the product for two years, the social media giant does not expect the virtual space to be ready for a roll-out any time soon — which goes against some industry experts’ beliefs.
Facebook Expects the Metaverse in 15 Years
Believing in a metaverse-driven future, Facebook has unveiled intentions to collaborate in developing the metaverse. The social media giant has allocated a two-year $50 million fund, dubbed XR Programs and Research Fund, to the project with the aim of investing in “programs and external research” that can help foster growth for the metaverse.
Notably, the announcement reveals Facebook’s description of the nebulous term “metaverse.” Here is how the company defines the metaverse:
“The “metaverse” is a set of virtual spaces where you can create and explore with other people who aren’t in the same physical space as you. You’ll be able to hang out with friends, work, play, learn, shop, create and more. It’s not necessarily about spending more time online — it’s about making the time you do spend online more meaningful.”
Moreover, the giant social media asserted that the metaverse is not a product that a company can create alone, rather it is like the internet — a vast network that has become valuable because too many people and companies have contributed to improving it. Facebook added:
“And it [the metaverse] won’t be built overnight. Many of these products will only be fully realized in the next 10-15 years.”
However, an article by The Independent reveals that younger people, entrepreneurs, and crypto evangelists believe the metaverse is actually much closer than 10 years away. Referring to the advancements made in VR and AR industries, advocates believe the race for bringing life to the digital space is on.
Facebook to Proceed “Responsibly”
Arguably, to get ahead of criticism, Facebook has emphasized they will build the metaverse responsibly. The social media giant claimed they would achieve this by working with experts in government, industry, and academia. The official post reads:
“Its success depends on building robust interoperability across services, so different companies’ experiences can work together. We also need to involve the human rights and civil rights communities from the start to ensure these technologies are built in a way that’s inclusive and empowering.”
The fact that Facebook is proceeding conservatively comes as no surprise since the company has a history of conflicts with government officials. Back in 2019, when the company launched Libra with the aim of building a global financial system that could be used by everyone in the world, it attracted a massive regulatory backlash and eventually failed.
This was because Facebook had been breaking public trust repeatedly. The social media giant has been fined multiple times over user data privacy matters. In 2019, FTC fined Facebook $5 billion over privacy concerns, the largest fine ever imposed by the consumer protection agency.
These privacy concerns, along with the rise of rival alternative social media platforms such as Tik Tok and Discord has resulted in Facebook losing users, particularly in the US and Canada. A recent report by WeRSM (We are Social Media) reveals that Facebook’s daily active users in the US and Canada have been in decline since Q3 2020.
This is very bad for Facebook since the majority of its revenue comes from the US and Canada. In 2020, Facebook generated $85.9 billion in revenue, with $40.5 billion of that coming from the US & Canada.
Facebook Invests Aggressively in VR and AR
A report by The Information claims that Facebook has nearly 10,000 employees working in the Reality Labs division of the company. This means that almost a fifth of Facebook’s employees are working on augmented reality (AR) and virtual reality (VR) devices.
Mark Zuckerberg, co-founder, and CEO at Facebook said in early March this year:
“Today, most of what Facebook does is…we’re building on top of other people’s platforms. I think it really makes sense for us to invest deeply to help shape what I think is going to be the next major computing platform, this combination of augmented and virtual reality, to make sure that it develops in this way that is fundamentally about people being present with each other and coming together.”
Facebook’s revenue has been performing well over the last year and managed to make around $32.6 billion in profit in 2020. Despite this, many younger users are looking to their competitors to connect, such as Tik Tok. This raises questions over whether Facebook’s aging user base will be a good match for new innovations such as VR and AR.
It is worth bearing in mind that Facebook’s initial popularity was driven by young people, starting as an exclusive network for Harvard University students. With the next generation looking elsewhere, it may be that Facebook has to make another acquisition, such as when it bought Instagram, to grab its own piece of this new and emerging market.
Do you think Facebook would be able to sell its metaverse to users considering that it has waning public trust? Let us know in the comments below.