“We don’t even know what it is yet.” That’s how the theatrical depiction of Mark Zuckerberg described “The Facebook” to his then co-founder Eduardo Saverin in the 2010 film, The Social Network.
“We don’t know what is it. We don’t know what it can be. We don’t know what it will be.”
Much of the same can be said about the Metaverse. At The Wall Street Journal’s “Tech Live 2022” event last Wednesday, columnists asked several tech executives to finish the following sentence: “The Metaverse is …”
The answers varied. Snapchat CEO Evan Spiegel said “living inside a computer.” Microsoft Gaming CEO Phil Spencer, replied “a poorly built video game.” And Apple executive Greg Joswiak and Craid Federighi agreed on “a word I’ll never use.”
The responses weren’t surprising. After all, these tech executives represent Meta’s biggest competitors. But others have cast doubt on the company’s pivot to the Metaverse with the acquisition of the virtual reality company Oculus in 2014. Elon Musk stated in December 2021, “I don’t see someone strapping a friggin’ screen to their face all day.”
Meta’s stock plunged this week, as you might have heard, with commentators pointing to the company’s firm commitment to virtual reality and the spending of $25 billion on R&D just this year. Meta has sold more than 15 million units of its Quest 2 headset, according to some estimates. But it’s unclear if the purchase of Oculus will pan out as Zuckerberg envisioned.
It’s a prime example of the risk companies take when they make acquisitions and attempt to innovate.
It remains to be seen if the drop in Meta’s stock will sway the momentum of FTC Chair Lina Kahn’s interest in the social media company. Meta’s drop in revenue and users earlier this year certainly didn’t dissuade the FTC from investigating Meta’s acquisition of the VR fitness app Unlimited.
We don’t know what the Metaverse is yet. We know it’s predicated on virtual reality, with some hoping that the platform will fully incorporate blockchain technology. But we don’t know the impact the platform will ultimately have on the stream of commerce.
Meta’s Facebook is already in decline among younger users. And many of the naysayers on the long-term success of the Metaverse are seeing the company’s stock drop as a foreseeable day of reckoning.
The future of the Metaverse is up to Meta, its shareholders, and its users. It certainly shouldn’t be up to the Federal Trade Commission (FTC) or other regulatory agencies. Acquisitions help companies innovate to deliver new products and emerging technologies. The FTC should stay out of the way.