Meta Suffers US$2.8B Loss! Lessons to Learn from the Metaverse Fail!

Meta Suffers US$2.8B Loss! Lessons to Learn from the Metaverse Fail!

Meta said earlier this week it planned to raise the price of the Quest 2 headset from US$299 to US$399.

Facebook parent Meta lost US$2.8 billion on its virtual reality division, Reality Labs, during the quarter ending in June. The substantial sum is the latest sign that CEO Mark Zuckerberg and Meta continue to spend heavily to pivot the social media giant to the so-called "metaverse." Meta said earlier this week it planned to raise the price of the Quest 2 headset from US$299 to US$399. This is not the first time Meta has lost money when it comes to the metaverse. Earlier in Q1, the company's metaverse business, Reality Labs, continued to struggle in the first three months of the year, losing US$2.96 billion.

Meta has revealed that it is continuing to hemorrhage money to try and make the metaverse a reality. Meta's Reality Labs division, responsible for its VR and AR ventures, thus an important part of the company's dreams of building a so-called metaverse, lost the company US$10 billion last year, and over the previous six months dropped nearly US$6 billion more.

Now, what are the risks of investing in Metaverse

Even after facing a huge loss, Meta is not giving up on the metaverse. They want to continue with their research and don't want to miss any opportunity to explore what else this technology can offer. Along with Meta, big tech companies, gaming platforms, musicians, artists, and apparel brands are jumping into the metaverse; its future seems bright. Everyone wants to take a bite of the pie.

But most certainly not every pie turns out to be sweet and crispy. The same goes with this latest technology. Metaverse platforms are flooded with brands and creators claiming their own space. In such a competitive platform, you need to be very wise and calculative while investing.

Moreover, if you are investing to buy lands or stocks in the metaverse you have to consider the risk factors. Here are some of the risks of metaverse investing.

Limited Market Scope

The global metaverse market valued at around US$40 billion in 2021. The global Metaverse market is estimated to witness substantial growth during the forecast period, majorly due to the rising focus on converging digital and physical worlds operating the internet. But metaverse is a niche-specific sector where only those who are interested in the niche will invest. You have to keep in mind that your market scope is limited and small. Having a small market is not an issue but your investment strategy should reflect it. You can buy lands and real estate in the metaverse. However, you should always keep in mind that only those who have a clear understanding of the blockchain and metaverse concept will be interested in your virtual land or property.

External Factors

The trade union movement, market uncertainties, and government intervention might make it impossible to benefit the most from decentralization.

Narrow Product Lines

Decentralized product lines need to be adequately broad so that autonomous units can flourish within the same. This might not be of much help in small business houses having narrow product lines. Lower levels in the organization also lack competent managers thus adding to the difficulty quotient.

China's Warning

The China Banking and Insurance Regulatory Commission has warned the public about fraudulent Metaverse projects. The statement emphasizes that the movements surrounding the Metaverse have made it a prime target for scammers who illegally raise funds in the name of such projects and steal everyone's hard-earned cash.

Risks With Metaverse Scams

As crypto and metaverse are gaining momentum, the scams have also coinhabited the space. Make sure that you don't fall into the trap of any fraudster. Always research well before you buy any virtual real estate NFT. Check the authenticity of the land NFT, its owners and the platform it exists on.

There are a number of metaverse platforms evolving in the market. You have to choose the most credible and secure platform to invest in. Do not fall for new platforms or the ones that claim attractive returns. Go for the popular platforms like Decentraland or Sandbox that promise steady returns.

More Trending Stories 

Related Stories

No stories found.
logo
Analytics Insight
www.analyticsinsight.net