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Facebook, under universal fire, focuses on the metaverse

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Zuckerberg’s comments follow revelations uncovered in hundreds of internal documents by former Facebook product manager Frances Haugen, which was made public in early October with accusations that Facebook favors profits over profits. user safety. The documents showed that Facebook has been experiencing declining growth metrics for key user groups, such as teens and young adults, on Facebook’s flagship app for years.

The company also underlined its commitment to building the metaverse, an immersive digital environment accessible using virtual and augmented reality tools. To pursue future growth, Facebook has invested in products powered by virtual reality and augmented reality in part because of Mr. Zuckerberg’s long-held belief that they will be the basis of the next major communications platform. human, and a platform where Facebook hopes to get ahead of its rivals.

“I think this work is essential to our mission because it gives a feeling of presence, as if you were there with another person,” he said on the call. “This is the holy grail of the online social experience. “

Highlighting its dedication to the Metaverse, the company said it will begin reporting financial results for Facebook Reality Labs, which includes the Oculus hardware division, in the next quarter. The move will allow Facebook to separate its core digital advertising business from its major investments in building virtual worlds and allow investors to see the costs and revenues associated with those efforts.

The company will see a $ 10 billion reduction in operating income this year for investments in Facebook Reality Labs, the statement said.

Facebook is also hosting a conference later this week exploring “the future of augmented and virtual reality”. These devices would also make it easier for Facebook to deliver its services to consumers rather than having to rely on cell phone makers.

Some versions of these devices made their debut. Facebook, in partnership with Ray-Ban, unveiled its long-awaited smart glasses last month, which allow users to take photos and videos, listen to music and answer phone calls. Oculus in August announced new workplace features for Facebook Horizon, a virtual reality-based service where people can interact with others as digital avatars.

For the third quarter, strong user growth for the family of apps, including Facebook, Instagram and WhatsApp, offset some duller aspects of the company’s earnings report. Last quarter’s sales and revenue forecast for that period missed analysts’ estimates, and the social network said it was shaken by Apple’s restrictions on collecting consumer data from apps and the uncertainty associated with post-pandemic economic recovery.

Without Apple’s changes to iOS 14, the company would have seen positive quarter-over-quarter revenue growth over the September period, COO Sheryl Sandberg said.

“When you look at it from a technological point of view, they think Apple and Google can make changes to their operating system, and that affects” the business of Facebook, said Mandeep Singh, analyst at Bloomberg Intelligence. By building the metaverse, “they can control their own destiny.”

Zuckerberg also sees the appeal of young users in a crowded social media marketplace, which includes Snapchat and TikTok, to be central to Facebook’s future. The number of young adults on Facebook in the United States has declined by 2% since 2019 and is expected to continue to decline by a further 4% over the next two years, according to internal documents.

These young adults are also sharing less than a year ago and sending fewer messages, according to documents, which were collected by former employee Frances Haugen.

“They are clearly losing their engagement with the younger demographic,” Singh said, although he added, “it doesn’t hurt them in terms of ad revenue because they have a more mature business.”

Mr Zuckerberg has also presented a staunch defense of his company’s efforts to tackle the evils of his platform, as a wave of reports based on the documents collected by Ms Haugen revealed.

The documents, dubbed the “Facebook Papers,” were disclosed to the United States Securities and Exchange Commission and provided to Congress in drafted form by Ms. Haugen’s legal counsel. They are also the basis of a series of stories published in the the Wall Street newspaper from last month.

The company fights back accusations of misleading investors and the public about its efforts to tackle hate speech and disinformation, and explains how the platform was used to stage the Jan.6 attack on the US Capitol.

Zuckerberg said the media coverage of the Facebook Papers was part of a “coordinated effort” to paint a negative and unbalanced picture of Facebook’s work to moderate its platform, which he hailed as better than that of its rivals.

“Any honest account should be clear that these issues are not primarily about social media,” he said. “This means that no matter what Facebook does, we’re never going to fix it on our own.”

Bloomberg


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