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Could The $80 Billion Metaverse Flop Be One Of The Four Horsemen Of The AI Bubble Apocalypse?

## Technology Update: Meta's Shift in Strategy

RBy Ryan EllisMar 19, 20261 min read

Technology Update: Meta's Shift in Strategy

Meta Platforms Inc. has announced the discontinuation of Horizon Worlds on its Quest headsets. Previously a significant component of the company's virtual reality strategy, this platform will now transition to a mobile-only application. This decision follows substantial investment in virtual reality through Meta's Reality Labs division.

Since 2020, Reality Labs has reported approximately $80 billion in losses, including over $6 billion in operating losses during the fourth quarter of the previous year. Horizon Worlds, at its peak, recorded only a few hundred thousand monthly active users, falling short of the company's original projections for metaverse engagement.

The removal of Horizon Worlds from the Quest store is scheduled for the end of March, with a complete withdrawal from virtual reality platforms by Thu, Jun 15, 2023. The platform will persist solely as a mobile application, indicating a shift in Meta's focus away from immersive virtual reality experiences.

has announced the discontinuation of Horizon Worlds on its Quest headsets.
Ryan Ellis · Thehackingpost

In recent weeks, Meta's Reality Labs division has experienced significant restructuring, including over 1,000 job reductions. Resources are being redirected towards artificial intelligence infrastructure and consumer AI products, reflecting broader industry trends favoring AI over virtual reality.

When Meta was rebranded from Facebook in 2021, the metaverse was envisioned as a major growth area. However, market demand has not met expectations, and the high cost and complexity of VR headsets have hindered widespread adoption. The company’s investment in hardware and infrastructure anticipated a demand that did not materialize, contrasting with the rapid adoption of AI technologies.

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Meta's strategic pivot away from Horizon Worlds underscores the importance of aligning technology investments with user behavior and market demand. While AI is currently delivering immediate returns and enhancing existing workflows, the metaverse initiative required significant changes in consumer habits and new hardware investments.

Based on reporting by techround.co.uk.

AI transparency. This article was produced with the assistance of artificial intelligence and published under human editorial oversight. AI systems can make mistakes. Read how we use AI (EU AI Act, Art. 50).
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