Facebook’s parent company new mixed reality headset is out. Yes, Meta showed off the new $1,500 Quest Pro headset at its virtual reality/augmented reality and metaverse-focused Connect conference. Despite all the “metaverse”, Meta is looking for one thing: the ability to own and control an operating system, so that its capacity to innovate and monetize will be not be tethered to any other company’s ecosystem.
Until recently, Meta was close to $1 trillion valuation. Today, it is worth less than $350 billion. There are many reasons why that happened. Among others, industry players identified a very key reason: Apple changed the rules on how customers could be tracked, requiring customers to opt-in to be tracked. With that, few actually get tracked, making Facebook’s adverts become guesswork since to a large extent, it does not know the customers well. In other words, Facebook will not know you to deliver the right adverts because those digital identities like cookies are abstracted out by Apple. Apple owns iOS which powers most of its devices and change the rules by fiat.
As Apple does that, Google controls Android. Unfortunately for Facebook, it has none. And it is hoping that it can be the operating system for the metaverse. And that is why what it did this week is significant. Facebook is hoping that VR will have a future so that it can become the kingmaker in that space.
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As Facebook works to control the metaverse, TikTok is coming back to the physical space; the parent company of TikTok lost billions of dollars in its latest report: “By providing warehousing, delivery, and customer service returns, our mission is to help sellers improve their operational capability and efficiency, provide buyers a satisfying shopping experience and ensure fast and sustainable growth of TikTok Shop”. Amazon has a competitor!
Chinese social media app TikTok has been eating into Instagram and Snapchat’s user base for years. Now there are signs that it wants to take a piece out of Amazon’s pie too. According to job listings spotted by Axios, TikTok plans to build a network of e-commerce fulfillment centers throughout the U.S. These warehouses would allow TikTok to ramp up its nascent online commerce business, speeding up product deliveries to customers.
Physical world: Facebook will sell gadgets to help people get into the virtual world while TikTok wants to build warehouses to actually get people to do retails since watching dancing cats and smiling dogs may not deliver the alpha. Look carefully: to win the digital world, you need to have a leg in the physical one!
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It’s like TikTok will become another Uber – more buzz than money. These companies have cost efficiency problem, but then, how do you tell a multi-billion dollar entities that there are basic things they are not doing right? Just gather users, throw money around, then record losses…
As for Meta, it just needs to survive, the construct of building your entire earnings and survival on ads buys is no longer appealing, because perception has changed, so you need to insert yourself in something more critical to people’s daily experiences.
When the behemoths are feeling threatened, what is then the hope of small guys? Everything is undergoing some kind of shift, and if you don’t pay attention, you get trounced.