Following Layoffs, Microsoft Hints at Halting Expansion of Metaverse


A week ago, Microsoft announced plans to cut around 10,000 jobs worldwide. With the sunsetting of AltspaceVR, the company’s plans to expand on the metaverse are likely to be halted for the foreseeable future.

Even as the world moves deeper into 2023, massive layoffs have continued. Tech giants, including Amazon, SAP, Google, and Microsoft, have cut thousands of jobs. Following in the footsteps of Meta, Microsoft, too, had big plans for the metaverse. Now, however, Microsoft is dropping hints about halting the expected expansion for the time being.

Recently, Microsoft announced the closure of its AltspaceVR facilityOpens a new window , which is set to close in March 2023. Furthermore, the tech giant has also fired the Mixed Reality Tool Kit (MTRK) team, which was responsible for integrating virtual and augmented reality.

While the company continues to focus on digital hybrid models, including mobility cross-functionality in shopping platforms, without compromising on the value from offline locations, it has not invested notable efforts in the hardware front with products like the Hololens.

Also, in December 2022, the company faced another roadblock with the FTC announcing a block on Microsoft’s acquisition of game developer Activision Blizzard Inc. for USD 69 billion. The FTC’s actions are said to have affected Microsoft’s metaverse goals.

When approaching the deal, Microsoft CEO Satya Nadella statedOpens a new window , “Metaverse is essentially about creating games. It is about being able to put people, places, and things in a physics engine and then having all the people, places, and things in the physics engine relate to each other… And so, the way we will even approach the system side of what we’re going to build for the metaverse is, essentially, democratize the game building.”

See More: The Metaverse Brings Huge Opportunities to the Future of Work

Microsoft to Focus on Mesh

All said, Microsoft does not plan to abandon the metaverse. A spokesperson for the company stated, “As we look to the future, we see the opportunity for VR expanding beyond consumer into business and now have an even greater goal: a more open, accessible, and secure version of immersive experiences in the metaverse. To achieve that, we have made the difficult decision to sunset the AltspaceVR platform on March 10, 2023, and shift our focus to support immersive experiences powered by Microsoft Mesh.”

Microsoft Mesh will now focus on mixed reality, VR, and AR to build a platform for all parties in the sector, including customers, creators, and partners.

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