Amid Layoffs, Microsoft to Draw Curtains Over Metaverse and VR

Microsoft to draw curtains over Metaverse and VR amid the ongoing layoffs to cut costs

Microsoft, which earlier this year announced layoffs of 5% of its entire workforce, has not spared even its budding divisions focused on Virtual Reality (VR) and the metaverse. AltspaceVR and the Mixed Reality Tool Kit, two related projects, are being shelved by the software behemoth. The metaverse and VR projects in Microsoft's pipeline may experience delays in development and testing in the coming days. The corporation prioritizes cost-cutting despite the continued market volatility, so 10,000 workers will be let go.

Microsoft was developing virtual worlds with AltspaceVR to act as locations for digital performances by visiting artists. It was a separate platform that Microsoft bought in 2017. This team has been touched by the tech giant's job layoffs.

The team behind the Mixed Reality Tool Kit was working on projects that would have user interfaces for the metaverse. The division's future direction is still up in the air.

The US corporation, which has its headquarters in Redmond, Washington, has been stepping up its efforts to enter the metaverse industry. Microsoft has been interacting with AR and VR developers generally by luring in former employees from Apple and Meta.

Satya Nadella, the CEO of the company, has also previously defended the idea of the metaverse and called it a game-changer.

Microsoft has already committed US$69 billion (about Rs. 5,62,574 crore) as a down payment for the metaverse industry.

Its choice to downsize its employees on this front might also be a factor in the Web3 industry's prolonged downturn.

Before Microsoft, Meta also disclosed that it will be letting go of 11,000 workers, including members of its teams working on the metaverse. The metaverse sector has lost a sizable number of developers to lerch.

These layoffs may delay the execution of plans by advertisers and companies who anticipate using metaverse technology to interact with their Web3 native clients.

By 2024, according to Bloomberg Intelligence, the business opportunity for the metaverse is predicted to be worth US$800 billion (or approximately Rs. 59,58,719 crore).