About a year and a half after changing its name to Meta and announcing that it would build a future version of the internet called the metaverse, Facebook has said that improving artificial intelligence will be its top investment priority.
In a letter to employees on Tuesday, CEO Mark Zuckerberg said that the company would be laying off another 10,000 people over the next few months. He also said that the company would be putting even more emphasis on “efficiency.” The shift to efficiency was first mentioned in Meta’s quarterly earnings call last month. It comes after years of putting a lot of money into growth, even in areas like a virtual reality where the potential wasn’t yet proven.
Zuckerberg says “Our single largest investment is in advancing AI and building it into every one of our products. He nodded to how AI tools can help users of its apps express themselves and “discover new content,” but also said that new AI tools can be used to increase efficiencies internally by helping “engineers write better code faster.”
Zuckerberg said on Tuesday that improving AI and putting it into all of their products is their biggest investment. He mentioned how AI tools can help app users express themselves and “discover new content.” He also said that new AI tools can be used to improve internal efficiency by helping “engineers write better code faster.”
The CEO made these comments after what he called a “humbling wake-up call” last year, when “the world economy changed, competitive pressures grew, and our growth slowed significantly.”
Meta and its predecessor, Facebook, have been researching AI for years, but the comments come at a time when AI is getting a lot of attention in the tech world. This started when Microsoft-backed OpenAI released ChatGPT to the public at the end of November.
The technology quickly became popular because it could give interesting, human-sounding answers to user questions. This seems to have started what looks like an AI arms race among tech companies. Microsoft said at the beginning of February that its search engine Bing would use the technology behind ChatGPT. Google showed off Bard, its AI-powered tool, a day before Microsoft did. Meta didn’t want to be left behind, so at the end of last month, it announced that it was putting together a “top-level product group” to “turbocharge” the company’s work on AI tools.
A senior equity analyst at Morningstar named Ali Mogharabi told CNN that Zuckerberg’s suggestion to focus on AI was a good idea. Mogharabi says that Meta’s investment in AI “has benefits on both ends” because it can help engineers make products more quickly and because adding AI features to Meta’s apps could make users spend more time with them, which can then increase advertising revenue.
Mogharabi said that in the long run, “A lot of the investments in AI, and a lot of enhancements that come from those investments in AI, could actually be applicable to the entire metaverse project.”
Mogharabi says that what shareholders and the market want to hear is that Zuckerberg is putting a lot of effort into investing in artificial intelligence and using the tools of this buzzy technology to make the company more efficient and boost its bottom line. Many investors had been unhappy with the company’s metaverse goals and spending in the past. Meta’s “Reality Labs,” which is where its metaverse work is done, lost more than $13.7 billion in 2022.
And investors seem happy with Zuckerberg’s decision to move away from the metaverse and focus on efficiency. Since the beginning of the year, Meta shares have gone up by more than 50% after falling in 2022.
Angelo Zino, a senior equity analyst at CFRA Research, says that Meta’s second round of layoffs “officially make us convinced that Mark Zuckerberg has completely switched gears, altering the narrative of the company to one focused on efficiencies rather than looking to grow the metaverse at any cost.”
Content Source: edition.cnn.com
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