Entertainment conglomerate Walt Disney Co. has reportedly scrapped its metaverse plans as part of its decision to lay off 7,000 employees and reduce US$5.5 billion in expenses, according to an internal memo sent to staff seen by numerous media outlets

See related article: India’s religious festivals coming to a metaverse near your avatar?

Fast facts

  • Disney’s metaverse unit had about 50 people, all of whom will lose their jobs, except the division’s head Mike White, according to the Wall Street Journal
  • Metaverse is a virtual world where users can take the form of avatars. Blockchain, the underlying technology of cryptocurrencies, can add an economic layer to these virtual worlds. Some metaverses can be accessed through virtual reality headsets. 
  • Several technology companies are facing challenges with their metaverse strategies, such as higher equipment costs and limited participation.
  • Mark Zuckerberg, the chief executive of Meta Platforms Inc., the parent company of social media platforms Facebook and Instagram, said in December that he was optimistic about the future of the metaverse. However, the company’s metaverse division which develops virtual reality technologies, Reality Labs, posted a higher loss of US$13.7 billion in 2022, compared to US$10.2 billion in 2021. 
  • Despite the challenges in widespread adoption, South Korea announced this month plans to invest about US$21 million into new projects looking to utilize metaverse technology for public services, while Japanese companies have signed an agreement to build a metaverse economic zone
  • See related article: South Korea keeps betting on the metaverse, ignoring the current clunky technology