Facebook parent Meta may be in the big tech club, but feels overshadowed by “giant tech” company — and corporate nemesis — Apple, a top executive Nick Clegg said Wednesday.
“There’s Big Tech and Giant Tech,” Clegg told an audience in Brussels, where Meta courted his latest virtual reality (VR) Gear.
“I mean, Apple is now eight times bigger than Meta in terms of market cap,” he said.
“I mean, it’s just very, very, very, very big” in that Big Tech sector and Apple it is, Clegg added.
The comparison underscores Meta’s steep market slide over the past 16 months — and the bad blood with Apple that gutted Meta’s data-gathering strategy.
Apple introduced a privacy option on its hugely popular iPhones last year, preventing Meta and other online data collectors from obtaining user tracking information, which they previously relied on for targeted advertising.
That helped Meta halve earnings in the third quarter this year.
The US company’s costly focus on the metaversea virtual world in which users posing as digital avatars can interact has also played a role.
Meta – renamed to reflect its focus – has to date spent a staggering US$100 billion (approximately Rs 8.2 billion) building this technology, which is expected to be many years away from widespread adoption.
Meta announced last month that it would cut 11,000 employees — 13 percent of its workforce — as part of a broader tightening of the tech belt that has also seen job cuts Twitter, Amazonand Hewlett Packard (hp).
Challenge from China
Meta’s market capitalization has fallen from an all-time high of US$1.07 trillion (about Rs.88 billion) in August 2021 to just over US$300 billion (about Rs.25 million) today – a 72 percent drop.
Apple’s value has remained consistently above US$2 trillion (about Rs.1.65 billion) for the same period since the end of 2020 and is currently at about US$2.3 trillion (about Rs.1.9 billion).
Meta has long complained that Apple is building a “walled garden” where its users are locked into its devices, operating system, and app store, at the expense of Meta and other online players.
Both Meta and Apple and other big tech companies have repeatedly come under the regulatory microscope in the European Union and United States as commercial strategies clash with antitrust and privacy concerns.
But Clegg said China is increasingly challenging US dominance of the online world.
“You have US and Chinese big techs that are really towering over the whole scene now,” he said.
“And by the way, don’t underestimate how aggressively Chinese big tech companies are investing in the metaverse,” he added, noting the Pico VR headsets being marketed by ByteDancethe Chinese owner of the popular social app tick tock.
Meta’s own investment in VR and augmented reality – collectively known as XR, or extended reality – demonstrated his belief that “the biggest bets are the furthest away… and they’re also the ones where the technology is most expensive.” ‘ Clegg said.
Investor criticism of that focus, and a “pessimism narrative” about Meta’s focus on it, “deeply underestimates the very, very strong health of the company’s underlying business,” he said.
