According to the news report by The Wall Street Journal (WSJ) on March 28, which cited the reviews of the “people familiar with the matter“ as the source, popular mass media and entertainment conglomerate Disney has shut down its metaverse division and dismissed over 7,000 staff in just two months.
This action was prompted in order to cut down the company’s budget by $5.5 billion as a part of its strategic restructuring plan. As reported by the WSJ, almost 50 members of media’s metaverse division other than Michael White, will now be without any new employment contract. Notably, White worked as the head of the broader consumer products unit.
As per the article, the news to lower the operating costs and laying off comes after the discussions with McKinsey & Company to find an economical solution. At the end, stronger competition and current disadvantageous market situations were cited as the main reason for making the situation worse for Disney.
Disney Unable to Dominate the Metaverse
In February 2022, the metaverse division was reportedly introduced in an effort to encourage innovative and creative ways to offer a whole new experience for the Disney audiences and to present Disney’s stories using new technologies.
It also has registered as a “virtual-world simulator,” which was expected to have a feature of headset-free augmented reality (AR) at Disney theme parks.
The company’s ex-CEO, Bob Chapek has previously said that the metaverse is “the next great storytelling frontier,” and its 71-years old current CEO, Bob Iger, also supported a number of metaverse projects. Notably, in November last year, Iger returned to replace Bob Chapek for two years.
Previously, the company entered with a flash in the world of blockchain industry. It emphasized on the projects which concentrated mainly on Non-fungible tokens (NFTs), metaverse, Decentralized Finance (DeFi), and blockchain. In addition, it announced the hiring of a transaction lawyer to monitor the innovative technologies while working on an “accelerated and aggressive timeline.”
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