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- Meta's VR/AR Roadmap 🛣
Meta's VR/AR Roadmap 🛣
And also: TikTok ban in the making, Elon's AI, AI-Powered Bing taskbar.
Update 2023-03-01
Meta Reality Labs Plans to Invest in AR/VR Hardware Despite Setbacks
Social Media and The Subscription Trend
House Committee Moves to Ban TikTok, Sparking First Amendment Debate
Uber Reports "Strongest Quarter Ever," No Broad Layoffs Planned
TikTok Launches Creator Program in the US to Provide Additional Earnings for Qualified Creators
EU Alleges Apple Music Violated Antitrust Laws, Potential $39 Billion Fine
Zoom Reports Net Loss, Restructuring Towards Enterprise Customers, Optimistic for Fiscal 2024 Strategy
Workday Reports Subscription Revenue up 21.7%; AI/ML Investment Increases and New Leadership Roles Appointed
Elon Musk Recruits AI Researcher for Chatbot Alternative Project
Microsoft Launches AI-Powered Bing Chat on Windows 11 Update
Thoma Bravo Completes $8 Billion Acquisition of Coupa Software
David Sacks Burn Multiple for SaaS Companies
Microsoft Xbox Game Pass Launch in 40 New Countries
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Big Tech and Startups
Meta Reality Labs division has shared AR and VR roadmap details with thousands of employees. The company plans to continue investing in consumer hardware despite setbacks and cost-cutting.
An "accessible" headset codenamed Ventura is planned for 2024, while the most advanced model, La Jolla, featuring photorealistic codec avatars, will be released in the future.
A second generation of the recent Meta Quest Pro is planned after Ventura in 2024.
Meta plans to release its first pair of smart glasses with a display in 2025, alongside a neural interface smartwatch designed to control them.
In 2025, Meta's third generation of smart glasses will ship with a " viewfinder " display and a "neural interface" band that lets the wearer control the glasses through hand movements.
The company intends for AR glasses to eventually be worn throughout the day as a replacement for smartphones and aims to make money off these devices by selling virtual goods and running AR ads.
📝 Cloudly quick take: Why is Meta betting so hard on AR/VR/Metaverse? They have felt the pain of not owning the platform where their product is being consumed (Apple privacy etc.) Zuckerberg is taking the bet that AR/VR will be a significant platform in the future, and do not want to miss that race. In our view, AR is much more likely to have a consumer breakthrough than VR (at least in its current form).
Social media companies have traditionally offered a “free” service, relying on ad revenue and user data to remain profitable. To cope with declining revenues, social networks are now looking to adopt subscription plans as an alternate source of income. These paid plans can offer users access to vanity checkmarks, exclusive stickers, and increased reach.
Twitter debuted its subscription service, "Twitter Blue", in 2021, offering exclusive features like a blue verification mark and priority in replies.
Facebook and Instagram followed suit with "Meta Verified", an $11.99/mo subscription plan with access to exclusive stickers and extra protection from impersonation.
Snapchat launched "$3.99/mo Snapchat+" back in June of last year, offering users perks such as pinning someone as their No. 1 friend and increased visibility in comments/recommendations.
Reddit also offers a premium membership program called "Reddit Premium" at $5.99/mo with ad-free browsing, custom avatars, 700 Reddit coins per month, and exclusive awards for posters.
Tumblr provides an ad-free version at $4.99/mo, allowing users to browse without ads.
US House Foreign Affairs Committee plans to vote on a bill that would give President Biden the authority to ban TikTok, the Chinese social media app used by more than 100 million Americans.
The bill, introduced by Republican chairman Texas Rep. Mike McCaul, is expected to pass the committee on Tuesday and then advance to the full House for a vote.
If passed, HR 1153 would revise existing rules known as the Berman amendments, enacted during the Cold War, and protected digital content like TikTok from sanctions-related import and export bans. The bill could ultimately ensnare TikTok, owned by China's ByteDance, if it is approved and referred to the full House for a vote with bipartisan support of stemming China's global influence.
Uber CEO Dara Khosrowshahi confirmed no broad layoffs are planned for the company. A more rigorous approach to performance reviews is being taken, which may result in reduced workforce numbers.
Uber reported its "strongest quarter ever," with $8.6 billion in revenue and 2.1 billion rides in Q4 2022. Layoffs are happening at Uber Freight but not company-wide, as previously discussed at Davos 2023.
TikTok is introducing a new Creator Program in the US for eligible creators to earn additional revenue. Participants must be at least 18 years old, have an account in good standing, and meet certain follower and video view counts.
The program requires users to post high-quality, original content longer than one minute. The company hasn't revealed how much it plans to pay out through the Creativity Program but stated it will "provide a higher average gross revenue for qualified video views."
The program has previously been tested in France and Brazil before launching in the US.
The European Commission has issued an update alleging that Apple Music has violated EU antitrust laws by imposing restrictions on developer's advertising subscriptions. In response to a complaint made in 2019, Apple must now respond to the allegation regarding the restrictions placed on developers, who were initially forbidden from mentioning or linking out to alternative methods of subscribing.
A potential fine of up to 10% ($39 billion) of Apple's annual worldwide turnover could result if the European Commission finds Apple in breach of EU law. However, Apple has yet to respond to the EC's update, and there is no legal deadline for bringing an antitrust investigation to an end.
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SaaS and Cloud
In Q4'22, Zoom reported its first quarterly net loss since 2018, with a net loss of $104 million. The total revenue for the quarter came in at $1.1 billion, up 4% year over year. In addition, enterprise customers contributed $636.1 million in fourth-quarter revenue, up 18% year over year. Zoom has earlier announced it would be making cuts of 1,300 employees due to current tech sector challenges.
CFO Kelly Steckelberg announced restructuring focusing on enterprise customers. CEO Eric Yuan described cuts as "painful" but said they allowed the company to reset, despite a slowdown in seat purchases and currency impact. Yuan is optimistic about the company's fiscal 2024 strategy, which seeks to redefine teamwork with immersive experiences and modern collaboration tools.
Zoom plans to embed AI into more workflows for smarter working, with features such as translations, captioning, and meeting summaries currently available.
Workday reported a Q4'22 loss of $125.7 million and an adjusted EPS of 99 cents per share, compared to a year-ago period loss of $73.3 million and an adjusted EPS of 78 cents per share, respectively.
Revenue rose to $1.65 billion from $1.38 billion in the year-ago quarter, while subscription revenue rose 21.7% to $1.5 billion from a year ago; margins for the quarter rose to 18.5% from 17.2%. The company forecasts subscription revenue at $6.53-$6.58 billion with an opportunity "well beyond $10 billion" when the environment improves.
AI/ML investment increased by $250 million, and Sayan Chakraborty was appointed Co-President to focus on AI/ML. At the same time, Robynne Sisco becomes Vice Chair for coordination between the global sales team & CFO office.
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AI
Elon Musk is contacting AI researchers to create a lab to develop an alternative to ChatGPT, the viral chatbot developed by OpenAI. Musk hopes to recruit Igor Babuschkin, a researcher who recently left Google's DeepmindAI lab, for his project. The billionaire has expressed displeasure at OpenAI and its relationship with Microsoft.
Musk has recently received criticism from Tesla investors that he needs to focus more on the electric car company.
Microsoft added an AI-powered Bing chat to the Windows 11 taskbar. In addition, the latest Windows 11 update includes a search box in the taskbar, and those on the waitlist can access it.
Microsoft executives stated that the new Bing gives people access to information previously difficult to find. Other features such as improved Chat, Phone Link for iOS, more widgets, tabs in Notepad, and Snipping Tool are also part of the latest update.
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Funding & M&A
Thoma Bravo, the California-based private equity firm, has completed its previously announced $8 billion acquisition of Coupa Software. Holden Spaht from Thoma Bravo looks forward to accelerating growth, investing more in product innovation, and better serving Coupa's world-class customer community.
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Learn
Burn Multiple is a capital efficiency measure used to evaluate the performance of startups based on their Net Burn (expenses) and Net New ARR (Revenue). It's an annualized version of Hype Ratio: Burn Multiple = Net Burn / Net New ARR. Burn Multiple allows investors to assess product-market fit by evaluating how much a startup burns in order to generate incremental revenue.
A higher Burn Multiple indicates that burn is high relative to growth; a lower one signifies efficient growth. Factors contributing to high Burn Multiple are gross margin problems, sales efficiency problems, churn issues, lack of growth, and startup leadership issues.
A multiple of 3x or less is usually acceptable for early-stage startups. As the startup matures, the Burn Multiple should improve; 0x is the expected mark for when the company becomes profitable. Founders can use it as a metric and rule to keep burn low and reduce wasted time and money in order to strengthen product-market fit.
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Quick news
Microsoft's PC Game Pass preview program is now available in 86 countries, including 40 newly added countries. To join the service, users must install the Xbox Insider Hub app and sign up for the Xbox Insider Program.
Subscribers get access to new Xbox Game Studios releases from day one and special pricing of $1 for their first month of membership. Coming soon are the action-strategy game Minecraft Legends on April 18th and Arkane's open-world vampire shooter Redfall on May 2nd.
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