Meta's Shocking VR Confession: What Does It Mean For Metaverse?

Meta spills the tea on the Metaverse!

Metaverse is just plain old VR with extra flair.

Meta, the "metaverse company" that used to be Facebook, has taken on the unusual role of downplaying the potential of the virtual world technology that its founder, Mark Zuckerberg, had staked the entire company on a few short years ago.

It hasn't announced a new course of action but it toned down its Metaverse hype to lobby against a proposal by European mobile network operators. The telecom operators want regional lawmakers to require major content providers (looking at giants like Meta!) to pay them a fee for carrying their data. This has created an unhappy scenario as Meta claims the network infrastructure upgrades will be necessary to make the Metaverse happen.

Despite the controversy, Brussels has listened to the telcos' concerns: the European Union's legislators announced a future network funding consultation in February. A short time later, Thierry Breton, the bloc's internal market commissioner, spoke at an annual telco industry bash and came out as fairly sympathetic to their argument.

Meta and other Internet companies like Netflix and Alphabet might be on the hook though. Telcom operators advocating for the measure said the five or six largest content providers should pay them. When the Metaverse is adopted, it will lead to lower usage of telecom networks and compensation is justified.

"We know that some European telecom operators have justified network fee proposals by speculating about capacity constraints caused by metaverse adoption — but this is nonsense," wrote Kevin Salvadori, VP of network, and Bruno Cendon Martin, director & head of wireless technologies at Meta.

It is not necessary for telecom companies to increase their capital expenditures for network investment in order for the metaverse to advance. They go on to say that this is so because "Metaverse adoption for the foreseeable future will continue to be driven predominantly through virtual reality (VR)" and because "almost all VR content is currently consumed over fixed networks through Wi-Fi," a technology they say is already widely available and well-established throughout most of Europe.

So, is Metaverse just Virtual Reality? If yes, do the telecom operators have valid point?

Meta’s Kevin Salvadori, VP of network and Bruno Cendon Martin, director & head of wireless technologies also added, "Looking ahead, Europe's fixed network capacity, with easily upgradeable FTTH/B [fiber-to-the-home/building] deployments, is more than enough to supply demand for the metaverse and other internet services for decades to come."

This implies that there won't be much of a difference between the product experience of being tethered to a headset in VR (something that's been around) and being "in the metaverse."
 
Yet, businesses that have invested in the Metaverse are unhappy with the decision of the telecom operators. In Q1 2022, Meta had recorded a loss of USD 4.28 billion although it is closer to USD 3.99 billion in 2023. Even the revenue from Meta Reality Labs, the home of Metaverse, was quite small at USD 339 million. This means that the Metaverse is no longer a sustainable project for many businesses, most of all Meta.

"The immersive worlds we can discover in VR are just one possible way to experience the metaverse." Small form factor Augmented Reality (AR) devices that superimpose digital content onto the actual environment will also play a significant role in the future of the metaverse. As Meta fails, AR-businesses will look to swoop in and take the crown of the Metaverse from Meta.

So, will AR take us to new dimensions? Or will Meta's Metaverse reign supreme again? Let us know your thoughts in the comments section below!