Mark Zuckerberg is criticized for spending too much on metaverse

 A representative of the Altimeter fund said that CEO Meta is gradually losing investors' confidence when spending too much money on the metaverse.

In an open letter to Meta and Mark Zuckerberg on October 24, Altimeter Capital Chairman Brad Gerstner said Meta had shifted to the metaverse in a hurry and cost too much money, causing business results to go down dramatically. bad.

At the beginning of the letter, Gerstner expressed support for Zuckerberg's vision because the founder had built Facebook successfully. However, he thinks that Meta is falling into a state of lack of focus, when there are too many people, many ideas but lacking the necessary urgent ideas. Overspending on such ideas, including the metaverse, causes investors like Gerstner to lose faith.

According to CNBC, Brad Gerstner's Altimeter Capital owns more than two million shares of Meta. Over the past 18 months, the stock is down 55%, well above the 19% average drop for other tech companies. "The drop in prices reflects a loss of confidence in the company, not just a bad market performance," Gerstner said.

According to this shareholder, Zuckerberg's team hastily turned to the metaverse, including suddenly changing its name to Meta and announcing that it will invest 10-15 billion USD a year in the new field, with new products. about AR, VR, immersive 3D, Horizon World and it could take 10 years to get results.

3D image of Mark Zuckerberg in the metaverse. Photo:Meta
3D image of Mark Zuckerberg in the metaverse. Photo:Meta

"If it's 1-2 billion USD per year, it won't be a problem. The company can R&D quietly and we will just focus on the core business," Gerstner emphasized. He said that users are still confused about what the metaverse is. So the estimated $100 billion investment for an unspecified future is "super large and scary, even by Silicon Valley standards."

Like many tech giants, Meta has an annual investment pool. In the period 2018-2020, this amount of Meta was 15 billion USD, but has increased to 30 billion USD this year. According to Gerstner, even excluding the investment for the metaverse, this is still higher than Apple, Tesla, Twitter, Snap and Uber combined.

Instead of showing that they are investing heavily in the metaverse, Meta shareholders say that the company should show interest in AI - an area that is in short supply globally. AI can also be applied to products like Facebook and Instagram to bring in revenue for the company. "Meta's investment in metaverse is smaller than investment in AI, but it gets the most attention and leads to confusion. The world is assuming you're spending 100% of your time on Reality Labs instead of AI and other things. core business".

Investors suggest that Meta should be limited to the metaverse to no more than $5 billion per year. In addition, it is necessary to reduce annual investment from $ 30 billion to $ 25 billion, and cut staff costs by at least 20%, equal to the level of 2021.

Meta has not yet commented on Brad Gerstner's letter.

In the past time, analysts have also assessed that Mark Zuckerberg has moved away from reality, always showing interest in the metaverse, but the published products are of low quality. The 3D image of the Facebook founder has been ridiculed with descriptions such as "rude", "crippled", "lifeless", and VR equipment is considered expensive. "The challenge for Meta is to be so focused on the metaverse that it lacks the necessary investment in its core products, Facebook and Instagram," Rich Greenfield, an analyst at LightShed Partners, told the FT.
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