Emphasizing The Metaverse Over Social Media Will Benefit Facebook’s Public Image, Says GlobalData

• Facebook’s rebrand is expected to highlight the importance of the metaverse, an upcoming ‘virtual world’ technology that GlobalData expects will be a ‘mega theme’
   
• Reducing Facebook’s association with social media will benefit the company’s public image following recent negative press, especially around data privacy - the company has the lowest possible score in GlobalData’s Thematic Social Media Scorecard
   
• Facebook is at the forefront of shaping expectations for the metaverse but other titans such as Microsoft are also expressing an interest
   
• GlobalData expects the economic structure of the metaverse will be founded upon NFTs and cryptocurrency

Mark Zuckerberg’s plan to rebrand Facebook to reflect the company’s commitment to building the metaverse, as well as moving away from its association with social media, will ultimately serve Facebook well, says GlobalData. The leading data and analytics company notes that the metaverse is set to be the next ‘mega theme’ that Big Tech has in its sights.

Amrit Dhami, Associate Analyst at GlobalData, comments: “GlobalData defines a ‘mega theme’ as something that will be particularly important and disruptive to the technology industry, so it is no surprise that companies such as Facebook are seeking to get a head start on developing the metaverse. While nascent, new metaverse-related prototypes are expected to emerge over the next three years.”

Facebook’s plans to dominate the metaverse are accelerating. A beta for the company’s virtual reality (VR) workspace Horizon Workrooms was launched in August, while September saw the announcement that Andre Bosworth, head of augmented reality (AR) and VR, would be promoted to chief technology officer. Further, the company announced last week that it is creating 10,000 jobs in the EU dedicated to developing the metaverse. By becoming a ‘metaverse company’, Facebook is shifting focus away from both social media and advertising - currently its primary source of revenue.

Zuckerberg is particularly keen to move Facebook away from social media, with whistleblower Frances Haugen recently testifying to the Senate that the company repeatedly put profits before users’ safety.

Dhami continues: “Now is the right time for Facebook to start disassociating itself from social media. It is serving an online community that is more concerned about mental health than ever before, which may make it harder for the company to avoid accountability. Facebook must win over sceptics of its data privacy capabilities as it currently has the lowest possible score in GlobalData’s Social Media Thematic Scorecard, at one out of five, and ranks twenty seventh overall in this sector out of 35 companies.”

Another challenge for Facebook is that the concept of the metaverse is not universally understood. GlobalData defines the metaverse as a ‘virtual world where users share experiences and interact in real time within simulated scenarios’. AR is expected to be a critical component, and GlobalData forecasts that the AR market will be worth $152bn by 2030.

Dhami adds: “The idea is for assets in the metaverse to echo how they function in the real world and be transferrable for goods or property. Therefore, the economic structure is likely to be founded upon NFTs and cryptocurrency. It’s early days for the metaverse, but Facebook is already pulling ahead with its enterprise tech.”

While Facebook is at the forefront of shaping expectations for the metaverse, another titan keen to make a move is Microsoft, which has also expressed a desire to occupy this space but has not made the same tangible steps as Facebook.

Dhami notes: “Microsoft intends to use digital twins to create an “enterprise metaverse” that is modelled on the real world. Digital twins use internet of things (IoT) sensors to synchronise a digital model of anything physical with its real-world version. The company has also launched a limited version of Microsoft Mesh, a mixed-reality, cloud-based meeting app that enables shared experiences. In all, GlobalData has recorded 36 deals relating to the metaverse this year so far. It is definitely an area to watch.”

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