Tencent Lays Off 300 Staff From Metaverse Unit
• Tencent, one of the largest Chinese tech companies, has laid off around 300 employees from its metaverse development teams.
• The company had been developing a specialized metaverse ring controller but scrapped it due to high costs and poor profitability predictions.
• Other major corporations like Pico and Microsoft have also announced plans to reduce their efforts in developing hardware and software based on the metaverse.
Tencent is well renowned for its software business, but it recently decided to abandon its ambitions to enter the metaverse hardware sector. This decision resulted in informing more than 300 workers that its extended reality division would be shut down. Reports suggest that Tencent briefly explored virtual reality about seven years ago, but it’s interest was reignited in 2021 thanks to advancements in pancake lenses and higher-resolution screens.
Impact of Layoffs
The layoffs will have an impact on hundreds of workers as well as the other major corporations that are reducing their efforts in developing hardware and software based on the metaverse. These companies are taking measures to save money, with Pico announcing plans to layoff 30% of its workforce across all departments.
Reason Behind Layoffs
The primary reason behind this decision is the high cost involved and poor profitability prediction when investing in creating a specialized metaverse ring controller. Furthermore, significant popularity of the Meta Quest headset could have also contributed to this decision by Tencent.
Overall, Tencent’s move to lay off hundreds of employees from its respective metaverse development teams serves as an example for other major corporations such as Microsoft and Meta who are also looking at ways to reduce their efforts on hardware and software related projects based on the metaverse