In 2022, Meta CEO and founder Mark Zuckerberg was repeatedly chastised for plowing funds into the company’s metaverse projects. Meta isn’t giving up on the metaverse, but Zuckerberg has deemed 2023 a “Year of Efficiency.” As part of that new commitment, Meta has announced it will stop supporting NFTs. However, Meta’s newfound efficiency also comes with another massive round of job cuts.
NTFs were the internet’s favorite new plaything in 2021 and into the first half of 2022. As cryptocurrency prices skyrocketed, so did the value of these digital items. Who would have thought an ugly JPEG of a monkey could be worth hundreds of thousands of dollars? In 2023, the market has cooled along with crypto prices. Many metaverse projects have woven NFTs into the experience, and it looked like Facebook was planning to go in that direction with its metaverse play. Now, it’s changing course.
According to Meta’s head of Commerce and FinTech, Stephane Kasriel, the company is trying to prioritize its activities. It would seem that NFTs aren’t the best way to “support creators, people, and businesses,” in Kasriel’s words. These exclusive digital items aren’t outright banned from the Facebook and Instagram platforms, but they won’t be integrated with Meta products. In the coming weeks, the company will end its support for minting NFTs on Instagram and sharing NFTs via both Facebook and Instagram.
According to a new blog post from Zuckerberg, The goal is to create a “flatter” and “more nimble” company in 2023. That’s business-speak for layoffs. The company will terminate about 10,000 employees and cancel hiring for 5,000 open roles. Zuck says that managers will have no more than 10 direct reports, and that will require major reorganization over the coming months. Meta hopes that giving employees more warning about the layoffs will help soften the blow — the company caught flak for the abrupt nature of last year’s layoffs.
Meta may be in this leaner mode indefinitely. “I think we should prepare ourselves for the possibility that this new economic reality will continue for many years,” says Zuck. The company’s heavy metaverse spending in 2022 saw its stock price dip by more than half, but this sort of tough talk about spending always boosts the stock price. The last round of layoffs bumped the price by about 20%, and today’s moves have already added 8% to Meta’s value.