- Alibaba has laid off some of the people working in its metaverse department
- The company will, however, keep its metaverse plans alive
- Alibaba started exploring the virtual world in 2021
E-commerce heavyweight Alibaba has reduced the number of employees in its metaverse exploration division, Yuanjing, in a restructuring move. Alibaba created the metaverse unit in 2021, joining other tech companies in exploring the virtual world, which was a hot topic then. The company disclosed that it’s not disbanding the metaverse department, indicating that it still believes in the technology.
Alibaba’s Metaverse Unit Remains
According to South China Morning Post (SCMP), the Chinese e-commerce giant’s move is meant to boost efficiency in the company. The layoffs affected employees in the company’s Hangzhou and Shanghai metaverse offices.
Alibaba’s metaverse department has “a few hundred workers,” but the company didn’t disclose the number of employees that were affected by the restructuring. SCMP reported that the company will continue operating the department with a focus on metaverse-based services, applications, and tools.
Alibaba’s move comes as tech companies across the board are abandoning their metaverse plans with some pivoting towards artificial intelligence (AI). Meta, for example, has reduced its focus on the metaverse and shifted to AI.
Meta CEO Mark Zuckerberg has in the past said that the company still believes in the technology despite incurring billions of dollars in its metaverse exploration journey. The company has also in the past restructured its metaverse department leading to layoffs.
Blockchain Companies Are Also Restructuring
Last year, Microsoft disbanded its metaverse department sending home around 100 staff. Entertainment company Disney has in the past conducted a restructuring that saw its metaverse unit dissolved.
Apart from tech companies, blockchain and web3-focused firms are also laying off some of their employees to stay afloat amidst a bearish market. Last week, for example, Ethereum-centered firm Consensys reduced its workforce by 20%.
With Alibaba reducing its metaverse workforce, tech companies will likely continue to either cut their metaverse budgets, reduce their workforce, or completely abandon their metaverse mission.
