Lack of access to data, competition, regulation... Never has the empire of the American billionaire had to face so many threats?
Does Mark Zuckerberg dream of living in the metaverse? No doubt that at this moment the terrible child of Silicon Valley would in any case want to spend a little more time there to escape the real world and its share of problems that are anything but virtual. Because the former Harvard student is going through a particularly complicated period. Undoubtedly the most complicated since the creation of Facebook in 2004. In addition to repeated scandals over the lack of moderation of online content, the 37-year-old billionaire must manage new financial, industrial and regulatory constraints which this time threaten- here is the very existence of his empire...
Tim Cook and the Data Battle
Never had a group lost so much money on Wall Street in a single day. On February 3, Meta saw its capitalization melt by 237 billion dollars, more than those of giants like Nike or McDonald's! The reason for this unprecedented fall? Not the results of the social network, which remain very good, but the not very bright financial prospects of the group in the years to come because of a certain … Tim Cook. Apple boss has been forcing millions of iOS app developers for several months(the Apple group's operating system) to obtain users' authorization to track their activities, what they consume, what they watch on their iPhones and iPads. A real nightmare for Zuckerberg, who has built his entire business on the exploitation of this data and the very juicy targeted advertising, which represents 98% of his income.
But without the ability to track the hundreds of millions of Apple users - unless they explicitly give their consent - Meta is a giant gone blind. H&M, Coca-Cola and other advertisers no longer have any interest in paying "Zuckie" handsomely to promote their clothes or drinks if he is not able to push it to the right customers... Result , the billionaire announced that Meta could lose, at the very least, $10 billion in revenue in 2022, or almost 10% of its annual turnover ($117.9 billion in 2021). "It's absolutely gigantic," slips an investor.
Zuckerberg publicly attacked Apple, accusing the world's largest capitalization of wanting to voluntarily "penalize" his group, which did not seem to bother Tim Cook, who assumes this policy. "Protecting the personal data of our customers is an absolute priority," replied the successor to Steve Jobs. In the meantime, the race against time is well and truly on for Meta, which absolutely must find a solution to reduce its dependence on advertising as quickly as possible and prevent its share price from continuing to fall.
Shou Zi Chew, the real rival
The situation is all the more complicated for Zuckerberg as Meta sees emerging from the depths of the Asian Web a rival to its measure: TikTok. A name as quick to pronounce as the speed at which the Chinese social network has conquered the planet. More fun, younger, with hyper addictive and particularly viral short videos, the application run for a few months by Shou Zi Chew, one year older than Zuckerberg, has become the darling of social networks; in 2021, the subsidiary of the Chinese giant ByteDance was the most downloaded application on the planet, ahead of... Instagram and Facebook!
TikTok and its billion users certainly still weigh less than Meta and its army of almost three billion monthly active users (including Instagram and WhatsApp), but the trend is clearly favorable to it. New generations no longer go to Facebook, now identified as an outdated and adult-oriented platform. “TikTok has succeeded in reinventing social networks with an even more engaging approach,” explains Julien Maldonato, partner at Deloitte. Sign of the trend, Facebook has just recorded for the first time in its history a decline in the number of its users over a quarter. “We are only talking about a million fewer people, but that is not trivial,” underlines Jean-Christophe Liaubet, partner at Fabernovel.
For the past few months, Zuckerberg, who has officially recognized that his group "suffers from competition" from the Chinese, has been working on the launch of new formats on the model of what TikTok does. Instagram has also adopted "reels", these very short and very engaging videos. But not sure that's enough to reverse the trend...
Satya Nadella, the future king of the metaverse
If he fears losing his crown as king of social networks, Zuckerberg has already found a new kingdom to conquer: the now famous "metaverse". The American is convinced that this digital space is the new frontier for tech giants. A gigantic market that several banks like Morgan Stanley have estimated at more than 10,000 billion dollars over the coming decade. In addition to the change of name of his group, Zuckerberg has put the package internally on the subject with the recruitment of thousands of engineers - 10,000 eventually in Europe - and the announcement of billions of dollars of investments each year.Except that Zuckerberg is not the only one to have smelled the good shot. Some 1,200 kilometers north of San Francisco, Satya Nadella, the boss of Microsoft, also harbors great ambitions in the metaverse, to the point of giving Zuckerberg a few cold sweats...
The boss of Meta obviously has assets, in particular his virtual reality headset, which is the gateway to the metaverse. The Oculus Quest is a bestseller. "It's the best product currently on the market", confirms an engineer. Meta also has the advantage of displaying the most competitive prices, especially compared to Microsoft's HoloLens headset. A few weeks ago, the Oculus represented just over 50% of sales on the world market. "They totally crush the competition in hardware", underlines Jean-Christophe Liaubet. But on the software things are very different. There, they are late", he adds. Which constitutes a real handicap. Because the metaverse is above all a subject of content.
However, at this level, Satya Nadella has a few steps ahead of his younger brother. “Meta has relied too much for years solely on infrastructure,” explains Julien Maldonato. Conversely, the Redmond group has gradually established itself as a global content giant thanks to Xbox and a series of acquisitions of successful game publishers such as Halo or Minecraft, and now Call of Duty thanks to the takeover of Activision Blizzard a few weeks ago for a whopping $69 billion. To catch up, Zuckerberg can always try to follow the same strategy: he has the means with his 60 billion dollars in cash. Provided of course that the gendarmes of the competition do not put too many spokes in the wheels.
Lina Khan or the risk of dismantling
Since her arrival at the head of the very dreaded Federal Trade Commission (FTC), the American policeman of competition, Lina Khan has been moving forward with a beating drum. With a simple objective: to bring the tech giants to heel. Zuckerberg knows it very well, his group is in the sights of the lawyer appointed less than a year ago by Democratic President Joe Biden. "Lina Khan is a real subject for Zuckerberg because he will not be able to make any structuring acquisition", underlines Julien Maldonato.
Post a Comment