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    Home»Startups»Reality bites: Mark Zuckerberg’s $110 billion Metaverse failure is a reminder that product-market fit still matters
    Startups

    Reality bites: Mark Zuckerberg’s $110 billion Metaverse failure is a reminder that product-market fit still matters

    Editor Times FeaturedBy Editor Times FeaturedMarch 25, 2026No Comments6 Mins Read
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    Earlier than AI was the massive tech inevitability that might proceed whether or not anybody needed it or not, there was the Metaverse.

    Till very, very lately, you can nonetheless go to worlds.com, a 3D on-line chat program that launched within the mid Nineties, and navigate via its nearly completely deserted virtual space, like an limitless, pixellated Angkor Wat. Educational literature got here to name areas like these, and there are many, “Digital Ruins”.

    Will we be left with any related remnant of Horizon Worlds? Meta’s virtual reality social network was as soon as offered as a key piece of the puzzle that might finally cohere as “the Metaverse”, and early final week  Meta announced that it was successfully shutting it down.

    On Friday, the tech behemoth backtracked barely; quite than utterly taking the app off the Quest retailer, it is going to now proceed to assist video games that exist already on Horizon World, however will not be adding anything new.

    Lower than 5 years in the past, Mark Zuckerberg introduced that  Facebook was being renamed Meta and that he was making the event of its Metaverse a precedence.

    Zuckerberg would finally sink US$77 billion (A$110bn) into Meta’s virtual reality push. Certainly, it’s straightforward to neglect that earlier than AI was the massive tech inevitability that everyone in the world was forced to interact with whether or not they preferred it or not, the metaverse crammed that position.

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    The thought of the metaverse — a broad time period for on-line worlds the place the bodily and digital converge and other people work together in a 3D area — was coined in Neal Stephenson’s 1992 sci-fi novel Snow Crash, however the notion of really bringing one about actually took off on the flip of the final decade.

    A Forbes piece from 2020 captured the overall tone of protection on the time: having regarded on the (uniformly optimistic, so far as the piece was involved) methods a metaverse might have an effect on each aspect of life, it informed us unequivocally, the metaverse was coming and requested: “How are you preparing?”

    Enterprise capitalist and former head of technique for Amazon Studios Matthew Ball, who wrote prolifically about what the metaverse would or may very well be within the early 2020s,  set out the preconditions for “true” metaverse, together with that it “by no means ‘resets’ or ‘pauses’ or ‘ends’, it simply continues indefinitely” and is “a residing expertise that exists constantly for everybody and in real-time”.

    McKinsey solely half incorrect

    In 2022, McKinsey consultants predicted that by 2030, “it’s completely believable that greater than 50% of reside occasions may very well be held within the metaverse”. In these years, customers purchased around US$2 billion price of digital land throughout totally different platforms.

    However what swiftly became apparent was how unhealthy, in its very bones, the thought actually was. It wasn’t simply the security, mental health, or surveillance implications of layering extra web over every little thing, nor the sense that it will take away the remaining slivers of human expertise that had not been privatised.

    Primarily, it was that the factor simply didn’t work.

    What was outstanding from the get-go was how amateurish it regarded — the avatars,  initially legless top halves, didn’t really feel an important deal extra subtle or tactile than, say, 1995’s 3D Movie Maker.

    The picture of Zuckerberg’s avatar in entrance of a pretend Eiffel Tower turned an ideal metaphor for the entire thing — billions being spent to create a world a lot much less spectacular than the one we already inhabit.

    After they promised so as to add legs to their avatars slightly below a yr later, Rolling Stone wrote:

    “It’s fairly astonishing … to contemplate the quantities of labor and expense that goes into every repair, for a product that has develop into a constant punching bag on social media and that the overwhelming majority of Meta’s current clients have little interest in utilizing.”

    What’s the issue?

    The primary downside was that metaverse builders didn’t appear to know precisely what downside they have been fixing.

    In a July 2021 interview, because the hype across the coming metaverse approached its peak, Zuckerberg informed The Verge (with apparently no irony): “We’re principally mediating our lives and our communication via these small, glowing rectangles. I believe that that’s not likely how persons are made to work together.”

    Which is true, however no-one appears to have concluded that the reply to that downside of recent life was but extra inescapable web.

    Take Lindt Chocolate’s try at a metaverse metaverse expertise with its ugly, inconvenient and unintuitive 3D online store. If folks did need a procuring expertise that supplied a break from the “small, glowing rectangles”, they may go to an precise store, quite than navigating a worse model of on-line procuring.

    Then there’s Decentraland, one other 3D on-line digital world during which the first exercise was the shopping for and promoting of NFT gadgets and digital land, which additionally described itself as a “metaverse”.

    Once more, it was a clunky and ugly expertise whose makes an attempt at joyful communal experiences like raves or New 12 months’s Eve events created eerie, uncanny and utterly dead experiences.

    By 2023, the worth of digital land in Decentraland and elsewhere had plummeted.

    The best way speak of a metaverse has petered out is a reminder that blanket utility of an inescapable, dangerous expertise that nobody needed doesn’t need to be as inevitable as it could appear.

    It is likely to be tempting to hope AI will go the identical manner, however in fact each its sensible and slop kinds have already conclusively seeped into day-to-day life.

    The truth is, by way of decline porn, warfare misinformation and 1,000,000 different innovations, AI has put an inescapable illusory veil over our world way more totally than the metaverse ever did.

    • This story first appeared on Crikey. You’ll be able to learn the unique here.



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