Walt Disney Entertainment Co. reportedly canceled its metaverse plans as part of a decision to lay off 7,000 employees and reduce costs by $5.5 billion, according to an internal memo sent to employees.
Disney’s metaverse unit employs about 50 people, all of whom will lose their jobs, with the exception of division head Mike White, according to the Wall Street Journal .
Metaverse is a virtual world where the user can take the form of an avatar. Blockchain, the underlying technology of cryptocurrencies, can add an extra layer of economics to these virtual worlds. Some metaverses can be accessed through VR.
Some tech companies are facing challenges with their metaverse strategies, such as higher equipment costs and limited participation.
Mark Zuckerberg, chief executive officer of Meta Platforms Inc., the parent company of social media platforms Facebook and Instagram, said in December that he is optimistic about the future of the metaverse.
However, the virtual reality division Metaverse, Reality Labs, posted a higher loss of $13.7 billion in 2022, compared with $10.2 billion in 2021.
Despite challenges in widespread adoption, South Korea this month announced plans to invest around US$21 million in new projects aimed at using metaverse technology for public services, while Japanese companies have signed an agreement to build a metaverse economic zone.
