Facebook Outlines Its Plans To Create A “Metaverse”

Facebook has joined the likes of Twitter and Snap in posting strong Q2 results, but the social media giant is now warning of a significant slowdown in the coming months.

Facebook posted 56 per cent year-on-year increase in revenue to reach $US29.08 billion ($39.3 billion) – marking the fastest growth since 2016.

The strong growth has been attributed to a 47 per cent increase in average price per ad, along with a 6 per cent increase in the number of ads it delivered.

“We had a strong quarter as we continue to help businesses grow and people stay connected,” said Mark Zuckerberg, Facebook founder and CEO. “I’m excited to see our major initiatives around creators and community, commerce, and building the next computing platform coming together to start to bring the vision of the metaverse to life.”

However, the company has flagged a looming decrease in the rate of revenue growth.

“In the third and fourth quarters of 2021, we expect year-over-year total revenue growth rates to decelerate significantly on a sequential basis as we lap periods of increasingly strong growth,” the company said in a statement.

“When viewing growth on a two-year basis to exclude the impacts from lapping the COVID-19 recovery, we expect year-over-two-year total revenue growth to decelerate modestly in the second half of 2021 compared to the second-quarter growth rate.”

Creating a “metaverse”

Facebook’s latest results come as the company flags its desire to create a ‘metaverse’ – a new concept that combines virtual worlds.

The concept will bring together AR and VR technologies, which Facebook has been investing in through the acquisition of Oculus and other innovations.

Zuckerberg described it as: “an embodied Internet that you are inside of”.

Head of Facebook’s Reality Labs Andrew Bosworth said the concept will bring these new technologies into the mainstream.

“Today Portal and Oculus can teleport you into a room with another person, regardless of physical distance, or to new virtual worlds and experiences,” Bosworth said.

“But to achieve our full vision of the Metaverse, we also need to build the connective tissue between these spaces — so you can remove the limitations of physics and move between them with the same ease as moving from one room in your home to the next.”

While a shift towards any potential metaverse may increase Facebook’s revenue from hardware (VR headsets etc), it is likely Zuckerberg’s new vision for the internet will still include options for advertisers.

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