In an open letter, Altimeter Capital’s CEO and founder recommended the tech giant cut its metaverse investments from $10-15 billion a year to $5 billion.
A shareholder’s open letter to Meta CEO Mark Zuckerberg has labeled the tech giant’s investment into the Metaverse as “super-sized and terrifying.”
The shareholder has urged the company to scale down its investment in the metaverse and its related technology arm amid a significant fall in its stock price over the last 18 months.
The open letter was published on Oct. 24 and was directed at Zuckerberg and the board of directors. It was authored by Brad Gerstner, CEO and founder of technology investment firm Altimeter Capital, which owns roughly a 0.11% share in Meta, according to Hedge Follow.
Gerstner said that Meta’s foray into the metaverse, while important, should not command as much investment from the company as it currently does.
He said the company has announced investments of $10 billion to $15 billion per year into its Metaverse project, including AR/ VR tech and Horizon World, but “may take 10 years to yield results,” explaining:
“An estimated $100B+ investment in an unknown future is super-sized and terrifying, even by Silicon Valley standards.”
Rather, he has urged the company to focus more on artificial intelligence (AI) and less on the metaverse, as it “has the potential to drive more economic productivity than the internet itself.”
“While most companies will struggle to monetize AI, we believe Meta is incredibly well positioned to leverage AI to make all of its existing products better,” he added.
Gerstner’s comments come on the same day the Bank of America downgraded Meta from a “buy” to “neutral” valuation, partly due to its Metaverse investments likely to remain an “overhang” on the stock because of the “lack of progress” and “new competition from Apple.”
Gerstner added that over the last 18 months, Meta’s stock has fallen 55% compared to an average of 19% for its “big-tech peers,” which he suggests “mirrors the lost confidence in the company, not just the bad mood of the market.”
Related: Facebook is on a quest to destroy the Metaverse and Web3
Gerstner isn’t the only person to think the future of the metaverse is a relatively “uncertain” one either.
On July 30, Ethereum co-founder Vitalik Buterin said that while “the Metaverse will happen,” corporate attempts such as those by Facebook will “misfire” because “it’s far too early to know what people actually want.”
The share price for Meta Platforms Inc has plummeted 60.53% over the last year to $129.72 at the time of writing — a far greater fall in the current bear market than the likes of Apple, Amazon and Google.
Meta is set to report its third-quarter 2022 results on Oct. 26.
Source: cointelegraph.com