Shulou(Shulou.com)11/24 Report--

In the early morning of October 12, Beijing time, it was reported that Facebook parent company Meta CEO Mark Zuckerberg (Mark Zuckerberg) was making a typical Silicon Valley mistake, which was made by Yahoo CEO Marissa Mayer about 10 years ago. Later, Yahoo was sold and Mayer resigned. This time, can Meta and Zuckerberg realize their meta-universe vision?

The growth rate of an internet giant is slowing; a talented CEO is leading an ambitious bet; and a group of nervous employees are worried about imminent layoffs. That's what's happening inside Meta right now, and that's what happened to Yahoo about a decade ago.

With user growth stagnant and advertising sales slowing, Meta is turning into a "metaverse" company. In this process, the "growing troubles" brought about by these changes have also surfaced as a result of media reports.

Current and former employees are skeptical of Meta's efforts to promote augmented reality (AR) and virtual reality (VR) and are cautious about CEO Mark Zuckerberg's shift in focus (meta-universe), the New York Times reported recently.

Employees' concerns are similar to the internal turmoil experienced by Yahoo during the tenure of Marissa Mayer, the former CEO of Yahoo. Eventually, Mayer stepped down and Yahoo was sold for a fraction of what it was once worth. Now, years after Yahoo failed to turn a profit, Zuckerberg is repeating Mayer's mistake.

For CEO Zuckerberg, meta-universe is extremely risky. Zuckerberg announced about a year ago that Facebook would be renamed "Meta" and the company's business focus would shift to "meta-universe", which Zuckerberg called the "new Polaris" at the time. Zuckerberg believes that over time, people will live and work in virtual worlds and use "avatars" to interact.

Obviously, this is a bet. It's also a risk for the 18-year-old company (Facebook).

Zuckerberg's "meta-universe bet" may not be uncommon in the tech world. However, with the exception of venture capital, we do not often see such bets pay off. VCs can bet big on startups, hoping that one of them will be the next $1 billion, but Meta doesn't have to have that ability or pomp. After all, it has VR headlines to produce, social media platforms to grow, and advertising revenue to generate.

At the same time, Meta is devoting time and resources to meta-universe, and spending a lot of money in the process. Meta has invested $10 billion in a big bet in 2021. Even by Meta standards, this is a lot of money. This year, Zuckerberg also told shareholders that this trend will continue over the next three to five years.

Earlier this year, an industry veteran told the media that Zuckerberg knew very well that in the meta-universe market, he was playing a "long-term game", but it was also a "must-win" game. "Facebook has the courage, the capital and the ability to make it work and become a major market player," the person said. "but in the meantime, they can't make mistakes."

Mayer also has an ambitious vision, but it doesn't pay off. if you're familiar with Meta's current situation, you may have experienced the rise and fall of Yahoo.

Yahoo used to be an advertising giant. In 2004, it had revenue of $3.5 billion and a market capitalization of $128 billion. But with the rise of competitors such as eBay and Google, competition in the market began to heat up. Ironically, Facebook later became a competitor to Yahoo's advertising business. As advertising revenue dried up, Yahoo's market capitalization plummeted to about $20 billion in 2012.

At this point, Mayer took the stage. Her task is to restore Yahoo to one of the world's most outstanding technology companies that can compete with Google, Facebook, Apple and Amazon.

Mayer's bet is bold but not focused: developing an "all-for-everything" Yahoo App; that hired Katie Couric to set up a video interview column with an annual salary of $5 million; to produce shows like Netflix; and to buy blogging platform Tumblr for $1.1 billion.

But none of these big bets paid off. Two years after Mayer took office, Yahoo's goal of making a comeback has not been achieved, and the company's revenue is still stagnant.

In 2016, the era of Yahoo operating as an independent company ended. Verizon bought Yahoo for $5 billion, merged it with AOL (AOL), and Mayer resigned as CEO.

Zuckerberg and Mayer are in the same boat, and not only within the company, but Meta faces the same problems as Yahoo.

Recently, Meta employees said in an interview with the media that the company's strategy often changes, which seems to have something to do with Zuckerberg's whim rather than a data-based plan. In addition, Meta executives are divided on the meta-universe strategy. John Carmack, the former chief technical adviser to Oculus, has said that the company's large amounts of money spent on unproven projects made him "sick to his stomach".

Similarly, at Yahoo, Mayer is described as "making decisions based on intuition, not data". Yahoo, for example, pays $10 million a year for "Saturday Night Live" (Saturday Night Live) and hires Couric to set up a video interview with an annual salary of $5 million, even though her previous videos have failed.

And corporate culture. During her tenure, Mayer implemented a controversial performance ranking system designed to motivate people to work hard and identify incompetent employees. But it backfired, leading to staff frustration and low morale.

Now, Zuckerberg also seems eager to eliminate underperforming employees, as well as those who do not support his meta-universe vision. At a staff meeting in June, Zuckerberg told employees that Meta would step up its assessment of performance targets and eliminate undedicated employees. It was reported earlier this month that Meta was quietly laying off staff by changing its performance expectations, urging managers to drive employees home.

If Zuckerberg is right that meta-universe is the future, then these moves would be wise to help Meta stay ahead of the competition. There is also reason to believe that Zuckerberg's ambitious plan will work. After all, he foresaw the shift from desktops to mobile devices and reshaped Facebook once. At the time, even Sheryl Sandberg (Sheryl Sandberg), the "number two" of Facebook, thought the strategy was risky.

But if Zuckerberg's bet doesn't pay off, then we may see that Meta will follow in Yahoo's footsteps.

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