It’s 2021 and COVID-19 is slamming the world. Corporations everywhere are struggling, but Silicon Valley’s darling Facebook has never had a higher market capitalization. Its CEO, Mark Zuckerberg, has never been richer. 

As of today, Facebook, now rebranded as Meta, has lost hundreds of billions of dollars in evaluation, whereas Zuckerberg has lost more than 54 billion USD in net worth. 

So, what happened to Meta? In short: the metaverse. 

But what is the metaverse? Why is Meta spending billions of dollars on this technology? Will the metaverse succeed and help Meta succeed? 

In many ways, the metaverse is like today’s internet: there are marketplaces, meeting rooms, entertainment systems, and more. But instead of accessing the metaverse through your phone or computer, you gain entry by putting on a virtual reality (VR) headset, which simulates an environment and experience that is an animated copy of our physical world. It should be noted that you can access the metaverse using traditional technology such as apps or your local browser. These provide a less immersive augmented reality (AR) or social platform. 

In this virtual world, you interact with the world through an avatar and go from place to place. If you’re looking at a picture of a painting, on the internet it’s on a webpage, while in the metaverse, it’s perhaps a 3D simulated art gallery you access through your VR headset. 

But who owns all this? Much like the internet today, no one owns it — specific companies have their space within the metaverse that they run, all interconnected to each other. 

Now that we know what the metaverse is, let’s go back to the pandemic and see how Meta messed up. The pandemic meant that almost everyone who could stay indoors was doing so, so we were all using the internet more than ever before. This led to technology companies not just surviving the pandemic, but thriving in it — compared to other industries and past historical data within the technology industry. 

In a recent video about technology industry layoffs in the context of the pandemic, the Wall Street Journal notes that “many tech CEOs thought the growth would continue at the same rate they had seen for the last two years.” Speculations such as these influenced Meta’s decision to “be metaverse-first, not Facebook-first,” according to Zuckerberg. The company wanted everything from office meetings to socializing to happen in the metaverse, leading to Meta pouring almost 10 billion USD into developing its wearable VR/AR technology. This pivot was a huge gamble for the company, moving it away from its core business into a largely unproven area and betting billions on the latter’s success.

What does billions of dollars worth of investment in VR/AR technology look like? Commenting on the physical feel of the headset, The Verge reporter Adi Robertson claimed that after wearing it for a few hours, she “sometimes got a painfully numb strip on [her] forehead.” Physically, it’s not the best, but what about the software? When fellow The Verge reporter Alex Heath was reviewing the company’s Quest Pro headset software by being in the metaverse, he told fellow reporters, “​​This is like one of the most buggy software experiences ever, right?” The Verge Editor-in-Chief Nilay Patel said, “There is zero chance that I would ever make a serious decision in this software.” So Meta is failing in creating a digital office. 

When Robertson was in a public space in the metaverse, the population, consisting entirely of pre-teen and teenage boys, became incredibly excited that there was a woman logged on. Not exactly the social mecca the company had envisioned. 

As the lifestyle impacts of COVID-19 in 2022 have vastly diminished, the company no longer finds itself in the financially prosperous position it once experienced. To make matters worse for Meta, in 2021 Apple unveiled its App Tracking Transparency feature, which blocks the mining of Apple users’ data from companies like Meta. This new feature cost Meta roughly 10 billion USD in revenue. 

Additionally, posing an existential threat to Meta’s core business platforms, Facebook and Instagram, is their main competitor: TikTok. The platform has nearly one billion monthly users and in the words of New York Times technology reporter Taylor Lorenz, “Facebook is absolutely desperate right now to regain any semblance of relevance which they’ve lost quite a while ago.” Zuckerberg recently said to Meta employees, “Today I’m sharing some of the most difficult changes we’ve made in Meta’s history. I’ve decided to reduce the size of our team by about 13 per cent and let more than 11,000 of our talented employees go.” Although Meta is not alone in doing this — the tech industry is experiencing a wave of post-pandemic related layoffs — it is uniquely poorly positioned as the metaverse isn’t paying off and its core business is failing.

While the metaverse may seem new, it’s actually quite an old concept— which brings us to something called Second Life. You may know Second Life from the TV show The Office when Dwight Schrute logs on, stating, “Second life is not a game, it is a multi-user virtual environment. It doesn’t have points or scores, it doesn’t have winners or losers.” Second Life is effectively a version of the metaverse, including avatars. Given the fact that I just had to explain what Second Life is, you can see that it is not hugely popular, and, to me, it would seem simple why. Why would you live your life on a lower quality plane? This I think is the same problem that Meta has run into. Why exist in an uncomfortable, almost unusable, impractical piece of technology, when the real world exists? 

So will this technology take off? The Varsity spoke to Laurie Bertram, an associate professor of history at U of T who has taught courses on history and social media, to learn more. Although it may seem like a given that this technology will take off, Bertram said, “History is filled with new inventions that are marketed as being the thing that will change the future, and filled with histories of things that fail to deliver on those promises.” She also made the important point that we have new tech pushed onto us as if it is essential, but it often isn’t. Bertram said, “I’ve really stopped buying into hype for things.” She noted that many others who understand tech companies also don’t buy into its hype. 

I don’t think the metaverse will take off until the technology is there to make it convincing, and although that day might come, I doubt Meta will be there to see it.