By Martin Baccardax
The metaverse ended, as T.S. Eliot might have predicted, not with a bang but a whimper.
Meta Platforms, the Facebook parent which renamed itself after the virtual reality world it vowed to create five years ago, quietly shuttered a key portion of the project in a blog post earlier this week.
Horizon Worlds, the virtual reality app that tied into Meta's Quest VR headsets, will disappear in June, but remain an option for mobile phone users.
The ignominious conclusion marks a stark contrast to CEO Mark Zuckerberg's original ambitions for the project, which he said would host "hundreds of billions of dollars of digital commerce, and support jobs for millions of creators and developers." It would, he said, ultimately "reach a billion people."
Billions were indeed reached, but not in the form Zuckerberg had hoped: Reality Labs, the Meta division that hosts the project, has racked up around $75 billion in operating losses since 2020, with another $19 billion to come this year, according to the group's latest forecasts.
Trumpeting a corporate strategy is what CEOs should do, so in same ways Zuckerberg can't really be criticized for his full-throated commitment to this tech sector absurdity (although his previous failures to create a digital currency, a global bank and a trusted dating app might have given us pause).
What seems more egregious, in both hindsight and foresight, is the speed at which corporate America swallowed his vision of crudely-drawn cartoon doppelgängers conducting global commerce at a scale equivalent to the annual GDP of Japan.
"Our bottom-up view of consumer and enterprise use cases suggests it may generate up to $5 trillion in impact by 2030 -- equivalent to the size of the world's third-largest economy," analysts at McKinsey predicted in 2022.
"The metaverse is simply too big to be ignored," the report added. "It will have a major impact on our commercial and personal lives."
Wall Street was even more effusive in their forecasts, and tagged an $8 trillion value to the "total addressable market" the metaverse would tap.
The fact that none of these predictions was even remotely accurate should be top of mind as we're being told about the future of artificial intelligence.
Shortly after the first projections for the metaverse, PwC issued a report on the potential impact of AI technologies, and argued that it could contribute as much as $15.7 trillion to the global economy by 2030.
So far, that impact has been largely based on the many billions that big tech companies, including Meta, are spending in the AI arms race. But even that is up for debate.
Jan Hatzius, chief economist at Goldman Sachs, said in a recent interview with the Atlantic Council that its impact on U.S. growth has been "basically zero."
Forecasts for AI's disruption of the job market, however, bear a startling resemblance to early predictions for the metaverse.
ServiceNow CEO Bill McDermott told CNBC earlier this week that graduate unemployment could soar past 30% over the next two years as a result of AI automation. Anthropic CEO Dario Amodei warned last year that around half of all entry-level, so-called white collar jobs could be eliminated by the end of the decade.
Interestingly, PwC, which drew the first line in the sand in AI's economic potential, published data in January that showed more than half of the 4,400 company bosses it surveyed "have seen neither higher revenue nor lowest costs" from the new technology.
It's doubtful AI will flop as spectacularly as the metaverse did, if only because so many companies, universities, and governments are so vested in its success.
The efficiencies it can generate are immensely seductive for corporate bosses, while the benefits it can bring to higher education have college presidents enthralled. Governments love anything they can tax, and simultaneously vow never to get left behind on a new technology wave by China ever again.
But it's worth remembering a theory developed by economist Carlota Perez in the early 2000s: Big Bang technologies follow a predictable three-step life cycle of installation boom, mid point financial crisis and longer term adoption.
Predicting what may happen with the third, before calculating the second, only makes the first step seem even more frenzied.
"Only those who will risk going too far can possibly find out how far one can go," Eliot wrote in 1931. Being bold with predictions is fine, but so is being skeptical of their veracity.
Write to Martin Baccardax at martin.baccardax@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
March 19, 2026 13:03 ET (17:03 GMT)
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