The great Meta reset
Just over one year in, Meta's much-talked-about rebranding and focus on the metaverse has not so far worked out in the company’s favor. As of the beginning of November 2022, Meta disclosed that Facebook, Instagram, and WhatsApp, would see a significant wave of layoffs, affecting around 11,000 employees (13 percent of the company’s workforce). Meta’s market capitalization as of February 2023 stood at 479 billion U.S. dollars, making it the third most valuable U.S. based internet company. This is however a far cry from its peak of 1.07 trillion U.S. dollars in August 2021. For Meta, the development of a metaverse environment is still a work in progress, as plans to create a different kind of online experience are still in the very early stages. At the beginning of 2023, the company joined the generative AI race and stated the development of its AI discovery engine as one of its priorities , while relegating the metaverse development to long-term project status.Company financials
Although Meta generated an impressive 116.6 billion U.S. dollars in annual revenue in 2022, the company reported its first ever decrease, down from 117.9 billion U.S. dollars for the fiscal year 2021. This decrease in revenue is still substantial growth of around 36 percent when compared to 2020’s annual revenue of 85.9 billion U.S. dollars. Additionally, around 98 percent of Meta’s annual revenue is generated by its Family of Apps, with the remaining two percent being generated by Reality Labs. The vast majority of Meta’s revenue is produced through advertising.Meta’s Family of Apps and Reality Labs
Meta’s Family of Apps continues to dominate most the social media industry in terms of user numbers. Facebook is the most used social media platform worldwide, with almost three billion monthly active users (MAUs) as of January 2023. In addition, WhatsApp and Instagram have both achieved two billion MAUs. Nevertheless, Google’s YouTube is a strong competitor for the top spot, accumulating around 2.5 billion monthly users in January 2023. Meta Quest, the mobile app for Meta's VR headsets, was downloaded over ten million times in 2022, up from 7.5 million downloads in 2021, indicating steady yet substantial growth in interest in Meta’s VR products.On July 5th, 2023, Meta released Threads, a new social network that users can sign up for via their Instagram account. In juxtaposition to Instagram, Threads is a text-focused app, and much of the hype around this new platform is its release taking place around the time that big changes happening on direct competitor Twitter. Within one day, Threads amassed 30 million sign-ups.
Meta’s controversies and public opinion
Meta’s success has not been without controversy. With the Cambridge Analytica scandal in 2018 seeming like thing of the past, 2022 and 2023 brought numerous fines for Meta, breaking EU data protection and privacy laws. In September 2022, Meta was fined 405 million euros by the Irish Data Protection Commission (DPC) for violating Instagram's children's privacy settings – the second largest fine issued to a digital company for breaches of the General Data Protection Regulation (GDPR) as of 2022. In November 2022 and January 2023, Meta was fined again by the DPC for data scraping, and by the EU Commission for illegal advertising practices.Taking into consideration the fines and accusations of inadequate action surrounding content regulation, public opinion is split. Although Facebook is in many ways the most successful and well-known social media platform, a positive impression is not assured. As of May 2022, although 20 percent of U.S. adults reported having a very favorable opinion of Meta’s Facebook, a further 19 percent reported having a very unfavorable opinion of the platform. Moreover, four in ten U.S. adults aged 18 to 34 years had a somewhat or a very unfavorable impression of Facebook.
