Meta's Metaverse Meltdown: Why Facebook's Rebrand Now Looks Like a Billion-Dollar Blunder

The Rise and Fall of Meta's Metaverse Dream

Five years ago, Facebook unveiled one of the most surprising rebrands of the decade. While the social media platform itself kept the Facebook name, the parent company—which also owns WhatsApp and Instagram—became Meta.

The whole thing coincided with Mark Zuckerberg declaring the metaverse "the successor to the mobile internet" and pouring billions into the project. Zuckerberg's vision has faced ridicule for years, but after recent developments, it's now looking like one of the worst rebrands of all time.

(Image credit: Meta)

The Beginning of the End for Horizon Worlds

As reported by CNBC, the company is shutting down its VR platform Horizon Worlds in a "further pivot away from the metaverse." In a community blog, Meta announced that the Horizon Worlds app will be taken off the Quest store at the end of March and fully removed from VR on June 15.

Facebook's metaverse avatars were routinely mocked (Image credit: Meta)

Reality Labs Layoffs Signal Deeper Problems

Back in January, as reported by Wall Street Journal, Meta laid off 10% of its Reality Labs division, representing around 1,500 jobs. Reality Labs is the home of Meta's AR and VR divisions.

Zuckerberg's vision for the Metaverse has already faced ridicule from a design perspective, with rudimentary graphics and missing legs. But the laying off of over 1,000 staff from the metaverse division is a much more stark and serious sign that Zuckerberg's 2021 vision might not be the future.

Facebook's Meta rebrand suddenly doesn't look so smart (Image credit: Meta)

The Official Shift in Strategy

"We said last month that we were shifting some of our investment from Metaverse toward Wearables," a Meta spokesman told WSJ. "This is part of that effort."

Zuckerberg once thought this was the future (Image credit: Meta/Mark Zuckerberg)

The Original Vision vs. Today's Reality

Meta might have perfectly valid reasons for shifting investment, but it can't scrub its 2021 messaging from the history books. "The metaverse will eventually encompass work, entertainment, and everything in between," the company announced when unveiling its rebrand. Back then, Meta announced $10B of investment into Reality Labs.

All of which is to say, with the benefit of hindsight, that rebrand isn't looking so smart anymore. Still, to be fair, few knew in 2021 what the tech landscape would look like today—the likes of NFTs looked like they could change everything, along with the metaverse. But five years later, it looks like Facebook might have been better off changing its name to 'AI'.