Who Will Save Facebook?

'Tosin Adeoti
3 min readOct 28, 2022

By the time the markets closed yesterday, Facebook’s landlord, Mark Zuckerberg, had lost more than $100 billion in the last 13 months. A considerable percentage of that happened as the news was dropped that the stock of Meta had declared a $3.7 billion operational loss in the third quarter on just $285 million in revenue. Meta is the parent company of at least 90 companies, including Facebook, Instagram, and WhatsApp.

Mark may still be worth $37 billion, but he would not be happy to see that he has been plunged out of the top 20 on the list of the wealthiest people in the world. Many have said this is all on him as he has continuously ignored rising requests to pare back the company’s spending tied to the metaverse. Mark has been obsessive about the potential of the blockchain-enabled metaverse for some time now, and many are saying it is a waste of time. Meta’s VR/AR and Metaverse businesses are expected to post a loss of almost $13 billion for the year.

But it is not only Meta’s metaverse businesses that are not doing well. Meta is also having trouble with its Facebook and Instagram apps, where it faces stiff competition from TikTok and declining advertising revenue. Advertisements on Facebook and Instagram, which make up the bulk of Meta’s revenue, look to have reached their zenith. The company’s growth has slowed dramatically over the previous two years, and it is now approaching a saturation point with around 3 billion daily active users on its apps.

As you have observed, Facebook’s interface is no longer what it used to be. Instagram, too. Meta is adapting to the TikTok tsunami by making its products more TikTok-like — videos are constantly been pushed to users. Unfortunately, there is little evidence to suggest this will be a financially fruitful move. According to data, TikTok is rapidly overtaking Facebook and Instagram in terms of daily user time spent. Pew Research Center surveys show that most teens, who are an important group now and in the future, have stopped using Facebook altogether.

Previously, Facebook — before it was renamed Meta — had stayed ahead of the competition by acquiring or plagiarizing successful products. Such products include Snapt, bought in 2011, Instagram in 2012, Parse in 2013, and WhatsApp in 2014. During the wave of the extreme growth, Mark Zuckerberg acquired over 70 companies with little or no issues. However, the tables are turning. Antitrust regulators, in America and abroad, are saying, that’s not right. Just last week, Britain ordered Meta to sell Giphy, the recently purchased GIF-creating platform. Meta bought it for 400 million in 2020. Now, British regulators have said denying or limiting other social media platforms’ access to Giphy GIFs is unacceptable.

Also contributing to the nightmare are fellow American companies — Apple and Google. With their control of the iOS and Android smartphone operating systems, they have outsized control over the digital economy. Apple, in particular, has been unforgiving. Its iOS rule change will cost Meta $10 billion in revenue this year. Meta’s reaction is to either build its own OS from the ground up or find a way to sidestep smartphones. Mark is certain that Reality Labs — which houses its metaverse business — will produce this platform in some way.

Alas, it is this investment in the metaverse and virtual reality that the market is railing against. Mark, however, thinks it is of ‘historic importance’ and will ‘create the foundation for an entirely new way that we will interact with each other and blend technology into our lives as well as a foundation for the long term of our business.’

But there may be no respite in sight. There may be no success in the metaverse. Virtual reality may be a pipe dream. The anticipation of a segment of Wall Street to pillage and plunder Meta may become a reality.

But, ultimately, what options does Mark Zuckerberg have?