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Press Review - February 2024

Margaux Montagner
Published on
What's been happening in the brand tech world this month? Apple launches its first AR/VR headset in the US; tech CEOs come under scrutiny on the US Senate floor; Meta revenue soars as Facebook celebrates its 20th birthday; and Snap announces mass layoffs.

Apple’s much-hyped Vision Pro hits the shelves 

On February 2nd, Apple launched its highly anticipated Vision Pro headset in stores across the United States. Priced at $3,499, the Siri-integrated headset combines virtual reality (VR) and augmented reality (AR) and supports eye, head, and hand tracking for navigation, eliminating the need for external controllers. The Vision Pro is marketed around "spatial computing," which allows users to interact with virtual environments and objects overlaid on their real-world surroundings. Apple is still a relative newcomer in this particular market, which Meta has so far dominated. Still, the company is convinced that the Vision Pro could revolutionize the field, with CEO Tim Cook hailing the device as the most advanced consumer electronics device ever created.

While the Vision Pro is aimed chiefly at Apple enthusiasts and may not become a mainstream product immediately, the company's strong brand and history of producing high-quality products might boost its adoption. The device also boasts a more comfortable AR/VR experience for users, being lighter and less cumbersome than most in this category, a feat accomplished by Apple through an external battery - continuously plugged in, the latter allows for up to 2 hours of use.

While not all brands may find immediate applications for spatial computing, entertainment companies like Disney+ are already partnering with Apple to provide immersive viewing experiences on the Vision Pro, hinting at the device's potential for engaging audiences in new ways. Apple is also launching a dedicated App Store for the headset, with over a million compatible iOS and iPadOS apps and over 250 titles on Apple Arcade. Despite its niche market positioning, UBS projects around $1.4 billion in revenue for the Vision Pro.

Read more on The Drum and The Tech Portal.

Lawmakers confront tech CEOs over online child abuse in US Senate

Executives from five major tech companies – Meta, TikTok, Snap, Discord, and X – faced intense questioning from the Senate Judiciary Committee regarding their efforts to protect children online. The January 31st hearing, which lasted over four hours, focused on a wide range of issues, including combating child sexual exploitation, safeguarding young users' mental health, and ensuring the security of children's data. This hearing was part of a larger legislative effort to pass new bills aimed at enhancing online safety for young people: the Stop CSAM Act, the Earn It Act, the Shield Act, the Project Safe Childhood Act, and the Report Act. The Kids Online Safety Act (KOSA) was a topic of contention, with some executives expressing support while others were more hesitant. Another key issue was Section 230 of the Communications Act, which provides immunity to platforms hosting user-generated content; some senators argued that this hinders accountability. 

While several executives were subpoenaed, TikTok's Shou Zi Chew and Meta's Mark Zuckerberg appeared voluntarily. Zuckerberg took the unprecedented step of directly addressing the relatives of online child abuse victims present during the hearing. Expressing his sorrow for their suffering, Zuckerberg acknowledged the pain the families had endured due to incidents related to his company's platforms. This remarkable moment followed a series of intense discussions with senators who criticized Meta for not effectively tackling the widespread issue of child exploitation and abuse on its apps. After the hearing, Mary Rodee, a parent of a victim, still expressed skepticism about Zuckerberg's comments and criticized the company for not doing enough to prevent such tragedies, highlighting the need for action rather than just dialogue. And despite heated debates, experts remain divided on whether the hearing will lead to meaningful change, with some skeptical due to past failures to enact significant regulations and others hopeful due to the growing momentum for action.

More info at the New York Times and The Drum

Meta announces soaring revenue…

Despite the intense scrutiny faced by Zuckerberg at the congressional hearing, Meta's stock surged by 15% following a robust fourth-quarter earnings report. The report showed revenues of $40.1 billion, surpassing expectations and marking a 25% increase from the previous year. Following the good news, Meta announced its first-ever dividend of 50 cents per share and a $50 billion share buyback program. 

This financial success could surprise some, as younger social media users favor newer platforms like TikTok. Additionally, its Reality Labs division, responsible for VR development, reported a loss of $4.65 billion in the fourth quarter, contributing to a total loss of $16.12 billion for 2023. However, Meta continues to grow internationally, and having laid off over 20,000 workers in 2023, the company doubled its operating margin to 41% and reduced its expenses by 8%. Meta is also diversifying its business to reduce reliance on advertising revenue (which is heavily dependent on user data) by focusing on integrating artificial intelligence (AI) into its products – with a notable $9 billion purchase of Nvidia chips to support this initiative. AI is expected to improve advertising on Meta’s platforms and support new products like AI chatbots, and Meta anticipates rolling out AI services more broadly in the coming months. 

Read more at the Guardian

… as Facebook celebrates its 20th birthday

2024 marks the 20th anniversary of Facebook, launched by Zuckerberg in 2004. Starting as a Harvard-only network, the platform expanded to reach one million users in less than a year, then over one billion monthly users by 2012, with innovations like photo tagging and dynamic activity feeds contributing to its rapid growth. Despite a slight drop in daily active users at the end of 2021, it continued to expand, reporting 2.11 billion daily users by the end of 2023. Although its popularity among young people has waned, Facebook remains the most popular social media platform available and a dominant force in online social interactions.

In 20 years of existence, Facebook has often been a key player in significant events, for better or for worse. The platform has held major influence in election campaigns and grassroots movements, though it has faced criticism for its role in events like the Arab Spring, the violence against the Rohingya in Myanmar, and the 2016 US presidential elections. And as mentioned in a previous section, the company has been marred by controversies surrounding child safety issues. Also controversial is the company's business model, which centers around collecting user data for targeted advertising. While it has proven highly profitable, as mentioned above, this approach has led to multiple fines for mishandling personal data, including the high-profile Cambridge Analytica scandal. As Facebook reaches this two-decades milestone, some wonder whether its innovations can outweigh its missteps.

As part of Meta, Facebook has expanded its empire by acquiring companies like WhatsApp, Instagram, and Oculus and imitating competitors' features to maintain market dominance. Looking forward, maintaining its top position will be challenging as the industry evolves and Meta shifts focus towards the Metaverse and AI.

More details at the BBC and TechRound

Snap to lay off 10% of its staff in attempt to stay competitive

Snap Inc., Snapchat's parent company, has announced that it will reduce its workforce by approximately 10% – translating to around 500 employees facing layoffs, based on the company's reported staff count of 5,000 in late 2023. This decision comes on the heels of a reported net loss of $368 million in the previous quarter and just the release of the company's fourth-quarter results. The company aims to streamline its operations through layoffs by "reducing hierarchy and encouraging in-person collaboration."

The layoffs at Snap are part of a broader trend in the tech industry, which has seen over 232,000 job cuts in 2023, as companies like Meta and Google also navigate cost-cutting strategies to stay competitive. Snap's move is seen as an attempt to gain investor confidence, especially in light of Meta's aforementioned success in cost-cutting and revenue growth. However, Snap has struggled to recover advertising revenues after a digital ad slowdown and has faced challenges finding a mass market for its non-Snapchat products, including its augmented reality glasses, Spectacles. The company has also recently shut down an AR services division for business customers; this restructuring is expected to cost Snap between $55 million and $75 million in severance and related charges, the process being subject to local laws and consultation requirements.

Read more at the BBC

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