Meta fires 11k employees - Effect of economy or being bullish about metaverse?

[xSkylarx]

IMHO, it's about corporate and shareholder greed as these companies are not in the red- they are still making money, i.e., profit but not just as much, which expected in a global economic downturn.

That certain can't be the only reason to fire 11,000 employees. Economic slowdown will impact all but Meta is a giant. Such kind of layoffs can only happen when a company spends money into useless areas. That's exactly what Meta did - invested in Metaverse. It has now become a major reason for its own suicide.

Mark Zuckerberg was so bullish on Metaverse that he changed the name of his company to Meta. Now they don't even have 100,000 active users there after burning billions and billions of dollars.

Mark stated that the cost of developing Meta for the following year would be doubled. That is enormous. Mark is really into Meta; the problem is if he fires more people next year. Mark is so into Metaverse that it gets to the point that he changes the company's name to Meta. I am not sure, but now the hype of Metaverse is slowly dying. It's likely because of the recession or what, but it is not the same as when Mark first announced it. In any case, I'm still hoping that the development will go well.

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[Lucius]

Which one you think might be the actual reason? Don't you think Mark had gambled quite heavily in an uncharted territory and put the existence into huge risk?

All these so-called big CEOs are always gambling, but it's always money they can afford to lose and continue to live as if nothing important has happened. For all of them, people are just numbers that they can manipulate very easily, and it is precisely these people who are expendable to the point that they are so easy to get rid of.

However, he is not the only one who tries to save money by laying off workers, all similar companies have been doing it for some time, especially in the US. The largest US CEX already fired about 1200 people a few months ago, which is about 18% of the total number of employees, and a few days ago they fired another 60 people. We shouldn't be too surprised by that, it's our harsh reality and it will become even harsher with more and more automation and robotization.

[yhiaali3]

I prefer the second reason, Mark took a big adventure and spent huge amounts of money to invest in Metaverse but he did not get the required spread so far, of course he will not be able to get the return in a short period of time unless there is a huge demand for people to use Metaverse, he bet on something new It is unknown and he expected great results, but his hope has been disappointed so far, but in any case, no one knows that the market situation may change with the change in the situation of the global economy, and then everything can change.

[ingiltere]

Both look possible. I think Meta already have too many employees so cut down some of them would affect them positively in the long run.
About Metaverse, we are still in very early stages. They probably have to spend so much money and time to get an actual product that makes money for them. Maybe it will never happen, maybe another company will develop better product and Mark will have to buy that company to get bigger. There are a lot of possibilities in the long run.

[Vlad1977]

Although companies need fresh blood, how many families are there with so many people unemployed? (really a pity)
Now that the recession has emerged, many unnamed companies have also resorted to laying off workers and replacing humans with machines.
Meta is indeed a huge gamble this time around, and the stakes are bigger than ever. But at least he showed it on the bright side.

[Renampun]

...

Which one you think might be the actual reason? Don't you think Mark had gambled quite heavily in an uncharted territory and put the existence into huge risk?

Zuck totally invests in technology which will probably not yet be implemented in the next 5 - 10 years so I believe that they must maintain a financial balance. I've heard that Zuck said the success of the meta made them have to reduce employees, and I see that's not the real reason, Zuck was just making some shit.

[EdenHazard]

...

Which one you think might be the actual reason? Don't you think Mark had gambled quite heavily in an uncharted territory and put the existence into huge risk?

Zuck totally invests in technology which will probably not yet be implemented in the next 5 - 10 years so I believe that they must maintain a financial balance. I've heard that Zuck said the success of the meta made them have to reduce employees, and I see that's not the real reason, Zuck was just making some shit.

Well yeah the first time facebook founded , many doubted it would work.

Now here we are talking about it again and realized we were wrong in the next years as meta become our primarily needs just like facebook as a tool of communication nowadays.
There is nothing to do with recession or something , it is all just planned one indeed.

[Kakmakr]

I do not blame them.. the global economy is in a recession and many companies are scaling down on projects that are expensive... that said.... 13% of their global workforce is not a lot.

I do not think the Metaverse is a failed project, I just think the timing for it is not really good.... because loads of people are struggling with finances and connectivity like this will cost a lot of money. 

[Wexnident]

Have they even released anything from their metaverse project? I think a lot of big companies have these sorts of projects just to stay in the news and attract investors, much like their attempts at libra.

He has afaik. It's called Meta Horizon Worlds, I've watched someone play it, and oh boy was it horrid. Just the simple fact that it can't even load the lower part of the models on some specific VR headsets is already bad, from what I've heard you also have to pay to like clap to someone or something similar?

There's even an article about how the head of the production or something is forcing its dev team to "love" what they made, and it honestly sounds more like a guilt trip than anything else since anyone can see how bad the product they made is. Even VR chat which is 8 years old is a thousand times better than them and most of the content that's there was community made (afaik).

In a follow-up memo dated September 30th, Shah said that employees still weren’t using Horizon enough, writing that a plan was being made to “hold managers accountable” for having their teams use Horizon at least once a week. “Everyone in this organization should make it their mission to fall in love with Horizon Worlds. You can’t do that without using it. Get in there. Organize times to do it with your colleagues or friends, in both internal builds but also the public build so you can interact with our community.”

Source: https://www.theverge.com/2022/10/6/23391895/meta-facebook-horizon-worlds-vr-social-network-too-buggy-leaked-memo

[DrBeer]

Facebook/Meta is a classic example of a business that has greatly overestimated itself. Having entered an empty niche (social networks + advertising) and becoming a leader, the owners and management decided that IT WILL ALWAYS BE THIS. Money will always flow like water, they will always use their advertising, there will always be an influx of new users and an expansion of the audience.
Mistake, miscalculation, overestimation. Considering that the flow of money will never dry up, they decided to massively "invest" huge sums in new technologies. But they calculated something ... More precisely, they did not take into account:
1. There are no guarantees that this technology will give a profit NOW or at least pay for itself
2. They did not assess the objective condition of the donor, Facebook. The audience is decreasing, many have refused just because of the dominance of advertising, advertising has lost its former effectiveness - the total has dropped sharply, but the bloated staff, projects, spending money - have remained the same.

What's left for Mark? It is logical to reduce regular expenses while reducing regular income. And I don't think it's the end...

[jostorres]

Although companies need fresh blood, how many families are there with so many people unemployed? (really a pity)
Now that the recession has emerged, many unnamed companies have also resorted to laying off workers and replacing humans with machines.
Meta is indeed a huge gamble this time around, and the stakes are bigger than ever. But at least he showed it on the bright side.

What do you mean by fresh blood? New employees? But, if I am the company owner, I will just retain my old employees because they already have the experience and I am already familiar with them while it's also good if we will give chance to other people to earn and work with us.

Maybe we can just pick the employees who don't do their duties well and they are the ones we will be replaced. Not all things can possibly be done by a robot so indeed that it is big gamble for mark in the event his plans of replacing humans with robots fail but if this becomes a success then he can also save a lot of expenses. What if meta have been planning this before and they only use the recession as an excuse to start it? Hmm..

[Flexystar]

Mark, you know he has got the past right? I am not sure why are they even trying out new experiments if they are not able to make successful metaverse projects even after spending billions of dollars on it? 
For him, laying off the 11k employees might not seem a thing, but for those employees it was their own universe to work and feed the families. Mark has always been on the negative scale for me. Even facebook being in the court room for their worst data integrity policies but things are unstoppable considering his fat wallet. If he was not capable of making successful path then why bothered to hire people from global market and lead them towards unsuccessful careers.

[eaLiTy]

~
Mark stated that the cost of developing Meta for the following year would be doubled. That is enormous. Mark is really into Meta; the problem is if he fires more people next year. Mark is so into Metaverse that it gets to the point that he changes the company's name to Meta. I am not sure, but now the hype of Metaverse is slowly dying. It's likely because of the recession or what, but it is not the same as when Mark first announced it. In any case, I'm still hoping that the development will go well.

With the way things are going, i doubt they will be doubling their spending in developing Meta because after changing the name to Meta they lost a whooping $700 billion wiped off from the market and it has become one of the bleeding stocks in a long time which should be worrying for them and should think twice about increasing the expenditure and in order to tackle the current situation they need to reduce the work force.

[Hispo]

As people might be seeing in the news, Meta has fired 11,000 employees. It's a 13% reduction of their global workforce.

There might be multiple reasons behind it but two main reasons are surfacing across the social media,

1. They are preparing themselves for the upcoming recession and forecasted negative business revenues for upcoming years

2. Meta had invested heavily on Metaverse which failed to find users or ways to earn revenue. Now the investment is lost and putting huge financial pressure on Meta.

Which one you think might be the actual reason? Don't you think Mark had gambled quite heavily in an uncharted territory and put the existence into huge risk?

The second reason is the most likely.
On one hand, Facebook/Meta depends much on targeted advertisement and data collection as their business model, they do not sell hardware. But not Iphone users and even Android users are getting anti-tracking features in their stock operative systems, which explains Meta's shift towards the Metaverse as way to sell their own hardware to continue tracking, added to the fees they plan to make out in-game transactions.
 
This strategy has backfired, not only because the result they have gotten is unappealing (Meta graphics are worse than the average game from the 2000s)  and the investors do not longer believe in Meta, pulling out their money, this has obviously led Meta to cut their staff.

At lest, Meta is providing some relief to those fired: some months of salary, temporary insurance, etc. Hopefully those people do not suffer too much till they find another job.

[kryptqnick]

I think it's a recession thing, but honestly, it's a very rude move. If a company is strong and profitable, it should feel socially responsible for its workers and try to help them survive the recession rather than focus on how much money they can save if they fire people. Helping people out is not only the right thing to do morally, but also something that can help with the effect of the recession, help make it less significant. That's because when people get fired, their purchasing power plummets. Without purchasing power, they don't support the businesses they gave their money to in the past by buying food, entertainment or something else from them. This, in turn, leads to businesses struggling and firing more people, and all that deepens the negative effects of the recession.

[AmoreJaz]

I think it's a recession thing, but honestly, it's a very rude move. If a company is strong and profitable, it should feel socially responsible for its workers and try to help them survive the recession rather than focus on how much money they can save if they fire people. Helping people out is not only the right thing to do morally, but also something that can help with the effect of the recession, help make it less significant. That's because when people get fired, their purchasing power plummets. Without purchasing power, they don't support the businesses they gave their money to in the past by buying food, entertainment or something else from them. This, in turn, leads to businesses struggling and firing more people, and all that deepens the negative effects of the recession.

unfortunately, not all companies are thinking that way. most are thinking about how to cut their losses by firing some of their employees. it is hard but they need to do it to survive. we can't blame them because that's what they think is the best option for them to keep afloat in this market. for sure, they have studied their options. i don't think it is just their random decisions here.

[serjent05]

As people might be seeing in the news, Meta has fired 11,000 employees. It's a 13% reduction of their global workforce.
Which one you think might be the actual reason? Don't you think Mark had gambled quite heavily in an uncharted territory and put the existence into huge risk?

The actual reason is that they are short of funds, possibly they are cost-cutting since the company probably suffer losses from their recent venture.  We really don't know the reason at all since Meta never reveal why they are laying off 11k employees.  it is also possible that the influence of FB is getting weaker since the competition between messengers and social media platform is really tight. 

I think it's a recession thing, but honestly, it's a very rude move. If a company is strong and profitable, it should feel socially responsible for its workers and try to help them survive the recession rather than focus on how much money they can save if they fire people. Helping people out is not only the right thing to do morally, but also something that can help with the effect of the recession, help make it less significant. That's because when people get fired, their purchasing power plummets. Without purchasing power, they don't support the businesses they gave their money to in the past by buying food, entertainment or something else from them. This, in turn, leads to businesses struggling and firing more people, and all that deepens the negative effects of the recession.

unfortunately, not all companies are thinking that way. most are thinking about how to cut their losses by firing some of their employees. it is hard but they need to do it to survive. we can't blame them because that what they think is the best option for them to keep afloat in this market.

It isn't a rude move since the survivability of a company is involved.  It would be rude if they lay out employees and don't pay them.  I believe those fired employees are well-paid of their benefits.  I will do the same if I own a company and the company funds are running low.  Because if the company shuts down, it will leave 84k employee with no jobs.

[2stout]

IMHO, it's about corporate and shareholder greed as these companies are not in the red- they are still making money, i.e., profit but not just as much, which expected in a global economic downturn.

That certain can't be the only reason to fire 11,000 employees. Economic slowdown will impact all but Meta is a giant. Such kind of layoffs can only happen when a company spends money into useless areas. That's exactly what Meta did - invested in Metaverse. It has now become a major reason for its own suicide.

Mark Zuckerberg was so bullish on Metaverse that he changed the name of his company to Meta. Now they don't even have 100,000 active users there after burning billions and billions of dollars.

How and why was it allowed that billions of dollars was spent and burned?  But of course because of fiat visions.  The crazy thing is even if Meta didn't burn billions and nixed investing in the metaverse, they would have still laid off thousands, following industry trend.