Alibaba Shakes Up Metaverse Division with Staff Reductions as Industry Hype Dwindles
In Brief
To streamline its processes and enhance efficiency, Alibaba Group is downsizing its metaverse division, impacting personnel at Yuanjing.
Multinational technology company Alibaba Group announced a reduction in its metaverse workforce, leading to the layoff of numerous Yuanjing employees. This reorganization seeks to promote operational efficiency and refine company processes.
The cutbacks affected Yuanjing’s locations in Shanghai and Hangzhou, the provincial capital. Zhejiang province Founded by Alibaba in 2021 amidst a surge of metaverse interest, Yuanjing aimed to delve into this promising technology. Backed by significant financial investments in the billions of yuan, Yuanjing initially boasted a workforce of several hundred.
Despite the job cuts, it is anticipated that Alibaba’s metaverse division will continue its operations, maintaining its efforts in developing various metaverse tools, applications, and services aimed at its client base.
Alibaba's foray into the metaverse landscape has included investments like leading a $60 million funding round for Nreal, a Chinese firm known for producing augmented reality (AR) glasses. AR, together with virtual reality (VR) and mixed reality (MR), is often regarded as a critical conduit to metaverse platforms.
Recently, Yuanjing has been focused on crafting a cloud-based operating system intended to facilitate metaverse integration in gaming and a range of industrial sectors.
Alibaba Reassesses Metaverse Plans as Tech Industry Shifts Focus to AI
The decision to trim its metaverse workforce aligns with a shifting trend within the tech landscape, where major corporations are pulling back on their metaverse investments while increasingly investing in AI-related initiatives. resources into AI .
In October of the previous year, Meta Platforms, the parent entity of Facebook, reportedly laid off members of the Facebook Agile Silicon Team, part of its Reality Labs working on metaverse-related semiconductor innovations. In a similar vein, Baidu underwent management changes within its metaverse wing when head executive Ma Jie exited the company in May, as Baidu pivoted towards advancements in AI, particularly following the global debut of ChatGPT developed by OpenAI a few months prior.
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