Reality Labs, the Metaverse division of the large Meta, has recorded a loss of $2.8 billion in the second quarter of 2022. This marks the seventh consecutive red quarter in the books for Reality labs. CEO Mark Zuckerberg remains confident, calling the technology a “huge opportunity.”
Years of red numbers ahead
During the discussion of the July 27 quarterly earnings, Zuckerberg acknowledged that Reality Labs’ losses could continue for years to come. “The Metaverse is a huge opportunity for several reasons. I now have an even stronger sense that developing this over time will yield billions, if not trillions of value,” said an optimistic Zuckerberg.
In any case, what’s optimistic for the Metaverse industry, if we can call it that, is that a major party like Meta recognizes that it’s a huge market. The fact that they are fully committed and willing to take big losses indicates that there is a lot to be gained. The big question is, of course, which world will emerge as the winner.
Centralized vs Decentralized
Essentially, that question boils down to the battle between centralized parties and decentralized platforms, aka the battle between Web 2 and Web 3 that we’ve been reading a lot about lately. Companies like Meta and Twitter are part of Web 2, while Decentraland and other crypto projects are part of Web 3.
Who will be the ultimate winner has a big influence on the future of the internet. If the Web 2 companies win, we end up in a controlled environment. If the Web 3 companies win, we may have a freer future on the Internet.
The only downside to the Web 3 projects is that the Web 2 companies have huge amounts of capital to win this battle. Meta can afford to lose billions every quarter to make this a success. In the long run, this is almost impossible to fight against.
