Meta Likely to Cut Infrastructure Spends

Going forward, Meta is likely to spend less on infrastructure.

Meta is resorting to layoffs, in an effort to cut costs and improve efficiencies. While it is yet uncertain whether this would mean cuts in backend infrastructure (such as data centers), there is bound to be an impact, especially since 11,000 employees have been asked to leave.

CEO Mark Zuckerberg, in a letter to employees said: “I’m currently in the middle of a thorough review of our infrastructure spending. As we build our AI infrastructure, we’re focused on becoming even more efficient with our capacity. Our infrastructure will continue to be an important advantage for Meta, and I believe we can achieve this while spending less.”

Also, this development needs to be seen in the backdrop of data center infrastructure which powers the internet will need major upgrades to bring the metaverse from theory to practice. The metaverse will require a massive platform as data capacity requirements grow from new applications and uses, according to JLL.

The metaverse will require a massive platform and could ultimately be a significant driver of colocation leasing, according to industry experts. Also, this is bound to have a ripple effect on the data center industry.

What that essentially means is an increased focus on enhancing network connectivity, additional power allocation, more efficient data center cooling, reduced latency, scalability and the ability to expand on demand.

Meta is heavily investing in the metaverse, and this hefty bet has cost Meta $9.4 billion so far in 2022, and the company anticipates that losses will grow significantly year-over-year, according to CNBC.

“While we’re making reductions in every organization across both Family of Apps and Reality Labs, some teams will be affected more than others. Recruiting will be disproportionately affected since we’re planning to hire fewer people next year,” said Zuckerberg.

Apart from Meta, almost all the big tech majors such as Twitter, Microsoft, Google and others have resorted to job cuts. Recently, social media platform Twitter said that it is exploring the possibility of cutting extra server space in an effort to reduce costs.


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South Asia News
May 13, 2021