Disney Reportedly Axing Metaverse Division Amidst Company Restructuring
The metaverse division of Disney has apparently fallen victim to the latest round of layoffs announced by the company. Per reports from the Wall Street Journal citing people “familiar with the situation,” the whole next-generation storytelling and consumer-experience unit, comprised of 50 people, has been axed — this being part of the 7,000 layoffs the company is executing as a cost-cutting measure.
Disney’s Metaverse Division Is No More, According to Reports
Disney, the well-known entertainment behemoth, seems to have lost interest in the metaverse. According to reports coming from the Wall Street Journal (WSJ), the metaverse unit of the company was wholly disintegrated in the latest round of layoffs that CEO Bob Iger announced on March 27.
The measure, which will be completed in three waves, will reduce Disney’s headcount by 7,000, aiming to cut costs by $5.5 billion. In a memo sent to employees, Iger justified this move stating that it was “part of a strategic realignment of the company, including important cost-saving measures necessary for creating a more effective, coordinated, and streamlined approach to our business.”
Mike White, who was tapped to lead the now-defunct unit back in 2022 by former Disney CEO Bob Chapek, was the only that evaded the axe, with all of the 50 employees of the metaverse unit being laid off. The future for White at the organization remains uncertain at the moment.
Disney aimed to enter the metaverse in 2022, seeking new markets in which to introduce its intellectual properties. At the time, Chapek profiled the metaverse as a pillar to establishing various initiatives including the implementation of digital experiences. In a memo issued on February 2022, Chapek declared:
Teams across the company are exploring this new canvas, and I have been blown away by what I’ve seen. Today, we have an opportunity to connect those universes and create an entirely new paradigm for how audiences experience and engage with our stories.
However, the metaverse industry seems to be experiencing a slump in 2023. Axios indicates that companies involved in metaverse development might be facing problems getting funding, citing about $2 billion raised through March 2022 as compared to just a little more than $500 million so far this year.
Meta, one of the first major companies to pivot to metaverse and put the concept on the mainstream map, has also suggested that it is pursuing other interests after announcing 10,000 layoffs. On March 16, Meta CEO Mark Zuckerberg stated that while the metaverse remained a key part of the business, the single largest investment was focused on advancing AI and building it into each one of Meta’s products.
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