What You Need to Know about Facebook Metamorphosing into Meta

This article presents what you need to know about Facebook metamorphosing into Meta. 

Suffice to say that The Facebook Company is no longer Facebook but now Meta.

It is a fact that the Facebook company, the owner of the popular App, Facebook, Instagram, WhatsApp among others have changed its name to Meta.

Facebook on Thursday announced that it has changed its company name to Meta.

The name change was announced at the Facebook Connect augmented and virtual reality conference. The new name reflects the company’s growing ambitions beyond social media. 

The re-branding also comes after the company has dealt with a barrage of news reports over the past month stemming from whistleblower Frances Haugen’s trove of internal documents.

Facebook, now known as Meta, has adopted the new moniker, based on the sci-fi term metaverse, to describe its vision for working and playing in a virtual world.

On Thursday, the company, through its Chief Executive Officer, Mark Zuckerberg, announced the change to its corporate name signalling an active plan to move the company beyond the traditional social media setting. 

“Today we are seen as a social media company, but in our DNA we are a company that builds technology to connect people, and the metaverse is the next frontier just like social networking was when we got started,” Meta CEO Mark Zuckerberg said. 

The company also said in announcing the new name that it will change its stock ticker from FB to MVRS, effective Dec. 1.

Meta’s stock price closed up on Thursday.

The announcement also signals the company’s structural investment in the next wave of personal computing in virtual worlds experienced through computerized glasses.

This is definitely a risky move for the $900 billion company because the company will have to invest billions of dollars every year, in its attempt to turn its sci-fi conceptual fantasy of a metaverse into reality. 

The change of name does not affect the operations of its core digital ads business which is actually experiencing an upward growth projection. 

In July, the company announced the formation of a team that would work on the metaverse. Two months later, the company said it would elevate Andrew “Boz” Bosworth, who is currently the head of the company’s hardware division, to the role of chief technology officer in 2022. And in its third-quarter earnings results on Monday, the company announced that it will break out Reality Labs, its hardware division, into its own reporting segment, starting in the fourth quarter.

“Our hope is that within the next decade, the metaverse will reach a billion people, host hundreds of billions of dollars of digital commerce, and support jobs for millions of creators and developers,” Zuckerberg wrote in a letter on Thursday.

Over the past few years, the company has ramped up its efforts in hardware, introducing a line of Portal video-calling devices, launching the Ray-Ban Stories glasses and rolling out various versions of the Oculus virtual-reality headsets. 

The company has indicated that augmented and virtual reality will be a key part of its strategy in the coming years.

Zuckerberg on Thursday provided a demonstration of the company’s ambitions for the metaverse.

The demo was a Pixar-like animation of software the company hopes to build someday. The demo included users hanging out in space as cartoon-like versions of themselves or fantastical characters, like a robot, that represent their virtual selves. Zuckerberg used part of it to accuse other tech firms of stifling innovation with high developer fees.

Zuckerberg said a lot of this is a long way off, with elements of the metaverse potentially becoming mainstream in five to 10 years. The company expects “to invest many billions of dollars for years to come before the metaverse reaches scale,” Zuckerberg added.

“We believe the metaverse will be the successor to the mobile internet,” Zuckerberg said.

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Similar Move to Google’s Alphabet

This move is similar to Google’s 2015 reorganization of its company and subsequent renaming of its parent company as Alphabet.

Alphabet houses a string of companies aimed at serving as purpose vehicles for futuristics projects. These projects include but are not limited to curing death, bets and self-driving cars, among others. 

Alphabet has not been a complete success story as it has spent billions of dollars trying to convert science fantasy to science reality, Meta’s approach may not be so unfortunate as its strategy appears more focused than that of Alphabet.

Mark Zuckerberg won’t fizzle out of the public view like Larry Page of Google

It should be recalled that when Google reorganized into Alphabet, co-founder and CEO, Larry Page kept his job but handed the Google part of the business over to Sundar Pichai. 

After that, Page largely disappeared from the public view, and it was never quite clear what he was working on as other executives like Pichai and CFO Ruth Porat ran day-to-day operations.

Eventually, Page stepped down as CEO and gave Pichai full control over Alphabet as CEO.

Facebook plans to divert huge amounts of financial resources from its profitable ads businesses into investable future technologies.

Let’s bluntly put it, digital ads are the core business of Facebook, the company’s innovative stances notwithstanding. Its digital ads business is like a money-printing machine, and such inflows are planned to be re-invested to protect against future disruption. 

Cost Implications of Strategic Move

Meta should cautiously understand that even the most ambitious ideas require time and money than a publicly-traded company might be willing to spend.

How much will Zuckerberg be allowed to spend to make the metaverse? Zuckerberg said this week that Meta will spend about $10 billion over the next year hiring staff and developing the technologies for the metaverse.

 But it’s also clear that the technology needed to make the metaverse a reality is quite far off.  Mark Zuckerberg said 10 years, but it really is anyone’s guess at this stage.

That means it can only get more expensive and time-consuming for Meta to buy its way into building the metaverse if it can do so at all. 

More so, Meta announced a new virtual reality headset named Project Cambria. The device will be a high-end product available at a higher price point than the $299 Quest 2 headset, the company said in a blog post. Project Cambria will be released next year, Zuckerberg said.

Meta also announced the code name of its first fully AR-capable smart glasses: Project Nazare. The glasses are “still a few years out,” the company said in a blog post. Zuckerberg said, “We still have a ways to go with Nazare, but we’re making good progress.” 

Moving Beyond the Whistleblower

The re-branding comes amid a barrage of news reports over the past month after Frances Haugen, a former employee turned whistleblower, released a trove of internal company documents to news outlets, lawmakers and regulators.

The reports show that the company is aware of many of the harms its apps and services cause but either doesn’t rectify the issues or struggles to address them. More documents are expected to be shared daily over the coming weeks.

In a call with analysts on Monday, Zuckerberg vehemently refuted the claims and critiques in the reports stemming from the documents provided by Haugen.