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Zuck Talks Generative AI, Metaverse in Meta Earnings Call

• By David Ramel
• 02/02/2023

As Microsoft and partner OpenAI wow the world with AI advances, Meta CEO Mark Zuckerberg discussed his company's priorities for generative AI and the metaverse in a Q4 earnings call.

He said Meta is focused on AI, including the company's discovery engine, ads, business messaging, and increasingly generative AI, and the future platforms for the metaverse.

"I want to give some updates on our priority areas," Zuckerberg said in opening remarks. "Our priorities haven't changed since last year. The two major technological waves driving our roadmap are AI today, and over the longer term, the metaverse."

His remarks are especially noteworthy following reports last year of a clunky, primitive initial metaverse experience in its early stages, even though the company has sunk billions of dollars into the project, devoting to it some $10 billion -- or 20 percent of the company's costs -- in 2023. What's more, the company risks the perception of being left behind in AI as advances such as GitHub Copilot shake up the development world and ChatGPT and DALL•E 2 -- respectively generating prose and images in response to natural language prompts -- shake up the rest of the world.

Regarding that latter observation, Zuckerberg begs to differ.

"Facebook and Instagram are shifting from being organized solely around people and accounts you follow to increasingly showing more relevant content recommended by our AI systems, and this covers every content format, which is something that makes our services unique," he said before also noting AI investments for the company's advertising business. He said AI is the foundation of Meta's discovery engine and ads business and the company believes it's going to enable many new products and additional transformations in its apps.

He also seemed to take a shot across the bow of the Microsoft/OpenAI juggernaut, aiming to join the leadership ranks in that space.

"AI is an extremely exciting new area with so many different applications, and one of my goals for Meta is to build on our research to become a leader in generative AI in addition to our leading work in recommendation AI."

He expanded on those AI thoughts in response to a question from an analyst, in which he seemed to address the ChatGPT and DALL•E offerings without mentioning them by name (the below remarks are taken from a generated transcript and are manually filtered for "ums" and "you knows" and repetitions and other common speech distractions).

Yeah I can start with generative AI. I think this is a really exciting area, and I'd say the two biggest themes that we're focused on for this year ... and one is efficiency. And then the new product area is going to be the generative AI work. We have a bunch of different work streams across almost every single one of our products to use the new technologies, especially the large language models and and diffusion models for generating images and videos and avatars and 3D assets and all kinds of different stuff across all the different work streams that we're working on, as well as over the long term ... working on things that could really empower creators to be way more productive and creative across the apps and run a lot of different accounts.

So I know there's some really exciting stuff here. I want to be careful not to kind of get too far ahead of of the development of it, so I think you'll see us launch a number of different things this year and we'll talk about them and we'll share updates on on how they're doing. I do expect that the space will move quickly I think we'll learn a lot about what works and what doesn't. A lot of the stuff is expensive, right, to kind of generate an image or a video or chat interaction. These things we're talking about, are like cents or fractions of a cent, so one of the big interesting challenges here also is going to be how do we scale this and make this work more efficient so we can bring it to a much larger user base. But I think once we do that there are going to be a number of very exciting use cases. I realize this is a pretty high-level answer for now, but I think that we'll we'll be able to share more details over the coming months.

And here are his thoughts on the metaverse in which he uses a company term, "meta reality," which can't get an acronym because MR is already taken by mixed reality.

So the last area that I want to talk about is the metaverse. We shipped Quest Pro at the end of last year. I'm really proud of it. It's the first mainstream mixed reality device. I mean we are setting the standard for the industry with our meta reality system. Now, as always, the reason why we're focused on building these platforms is to deliver better social experiences than what's possible today on phones, and the value of MR is that you can experience the immersion and presence of VR while still being grounded in the physical world around you. We're already seeing developers build out some impressive new experiences like Nanome for 3D modeling molecules and drug development Arkio for architects and designers to create interiors, and of course a lot of great games.

The MR ecosystem is relatively new, but I think it's going to grow a lot over the next few years. Later this year we're going to launch our next-generation consumer headset, which will feature meta reality as well, and I expect that this is going to establish this technology as the baseline for all headsets going forward and eventually of course for AR glasses as well. Beyond MR, the broader VR ecosystem continues growing. There are now over 200 apps on our VR devices that have made more than a million dollars in revenue.

We're also continuing to make progress with avatars. We just launched avatars on WhatsApp last quarter and more than 100 million people have already created avatars in the app, and of those about one in five are using their avatar as their WhatsApp profile photo. I thought that was an interesting example of how the family of apps and metaverse visions come together, because even though most of our Reality Labs investment is going towards future computing platforms -- glasses, headsets and the software to run them. As the technology develops, most people are going to experience the metaverse for the first time on phones and then start building up their digital identities across our apps.