Inlinewithabroadertrendamongmajortechfirms,Chinesee-commercebehemothAlibabaisdownsizingitsmetaverseoperations.
Therestructuring,whichaimstoimproveefficiency,ledtolayoffsinYuanjing,Alibaba’smetaverseunit,asthecompanyrecalibratesitsfocusinthissector.
DownsizingMetaverseUnit
AccordingtothereportbySouthChinaMorningPost,whichisalsoownedbyAlibaba,thismovehasaffected“dozens”ofemployees.ThelayoffsreportedlyimpactedYuanjing’soperationsacrossShanghaiandHangzhou,Zhejiangprovince’scapital.
Theunitoncehadhundredsofemployeesandreceivedsignificantinvestmentsinthe“billionsofyuan.”Despitethereductionintheemployeecount,theunitwillstillremainactiveandwillshiftitsfocustometaverseapplications,tools,andcustomer-orientedmetaverseservices.
Aspartofitsmetaverseefforts,Alibabaspearheadeda$60millioninvestmentroundinNreal,aChinesecompanyspecializinginaugmentedreality(AR)glasses.
IndustryobserversbelievedthatAR,virtualreality,andmixedrealitytechnologieswouldserveastheprimarygatewaysforuserstoengagewithmetaverseplatformsinthefuture.Furthermore,Yuanjingdevelopedacloud-basedoperatingsystemthatfacilitatedtheuseofthemetaverseinvideogamesandvariousindustrialsectors.
Lastyear,AlibabaCloud,abranchoftheChinesee-commercecompany,teamedupwithAvalanchetobuildalaunchpadforcompanieslookingtodeploytheirmetaverseapplicationsontheLayer1blockchain.
FocusonAI
Alibaba’sdecisiontoreduceitsmetaverseworkforcemirrorsthetrendamongotherleadingtechfirmsthatarescalingbacktheirinvestmentsintheonce-promisingsectorandreallocatingresourcestowardartificialintelligence(AI).
InOctoberoflastyear,Facebook’sparentcompany,MetaPlatforms,laidoffemployeesfromitsFacebookAgileSiliconTeam,partofitsRealityLabsdivisiondedicatedtodevelopingcustomsemiconductors.Additionally,Baidu’smetaversehead,MaJie,departedinMayasthecompanyshifteditsfocusmoreheavilytowardAIfollowingthelaunchofChatGPTbyUSstartupOpenAI.
Evenastheinitialhypebehindthesectorappearstohavewaned,datafromGlobalMarketsInsightssuggestthattheglobalindustrialmetaversemarketwasvaluedat$22.4billionin2023andisexpectedtoexpandatacompoundannualgrowthrate(CAGR)of29.5%from2024to2032.
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