The media, technology, and advertising industries have all suffered significant knocks recently, leading to layoffs at businesses such as Amazon, Meta, and Twitter. It’s hardly surprising, given how intertwined each of those industries is. Massive IT giants like Google and Meta dominate the internet advertising sector (via Statista).
By the same reasoning, YouTube and Facebook must be among the most popular media sites. However, their effectiveness decreases when customers cease spending as much money on them as they used to, prompting marketers to spend less money selling their products to users of such platforms. As the cost of basic necessities continues to rise due to inflation, similar downsizing in the IT sector is expected to continue.
Following Meta’s sudden removal of 11,000 jobs on Nov. 9, CEO Mark Zuckerberg addressed an apology to the company’s former workforce, saying, “At the start of Covid, the world rapidly moved online and the surge of e-commerce led to outsized revenue growth … Unfortunately, this did not play out the way I expected. Not only has online commerce returned to prior trends, but the macroeconomic downturn, increased competition, and ads signal loss have caused our revenue to be much lower than I’d expected. I got this wrong, and I take responsibility for that.”
According to an SEC filing from Sept. 2022, the firm employed around 87,000 workers during the month of September, meaning the sudden loss of 11,000 jobs equates to a roughly 13% loss of Meta’s overall workforce across all of its businesses.
Portal’s death knell had already been rung
According to a Reuters report from November 11, Meta announced internally that it would be laying off large portions of its tech development staff. Approximately half of the firm’s 11,000 job cuts were in technology development, according to reports. Meanwhile, the company has ceased all work on Portal smart displays and smartwatches.
Aside from digital media, Meta is a large firm that operates in a variety of industries. For example, its Reality Labs division conducts virtual reality research and development, resulting in products such as the Meta Quest 2 and its significantly more costly equivalent, the Quest Pro. However, its economic model is still fundamentally dependent on advertising, which implies that its most pressing need is to remain competitive in ways that keep people interested in its products.
It makes sense that Portal and its smartwatch companion would lose support in lieu of other Meta products. Putting it simply, Portal isn’t all that successful as an advertising revenue-generating product if people don’t use it. Engadget reported in June that Meta would be discontinuing Portal sales to consumers in favor of enterprise customers, meaning its existing audience of roughly 1.4 million non-enterprise customers is likely far too small to sustain for the cost of R&D. Regardless, there are several good reasons not to trust a Meta-controlled smart device, whether you’re a professional organization or an average Joe consumer, but the company itself probably wasn’t all that keen to continue pumping its resources into a physical product line that wasn’t directly aimed at your household’s Christmas tree this upcoming holiday season. If giving your data away to Meta isn’t a concern, then arguably the Quest 2 is just a better bet.
