Disney, the global entertainment giant, is reportedly making a major shift in corporate strategy by dismantling Disney’s Metaverse division.

Apparently, the move is part of a larger plan to cut operating costs by $5.5 billion and cut the number of employees by 7,000 over two months.according to wall street journal (WSJ), about 50 members of the division will be left without new contracts.

Disney’s Metaverse division had high hopes

Chief Mike White Disney’s Metaverse Division, founded the unit with the goal of exploring innovative ways of storytelling using technology. He was tasked with creating a technical toolkit that his executives at Disney’s Creative could use for their projects. White, who has been with Disney for more than a decade, is not believed to be affected by the job cuts.

The department also looked to integrate augmented reality (AR) and other advanced technologies to enrich Disney’s storytelling. As an early example of this effort, an eight-minute augmented reality movie was recently released on Disney+. By prioritizing innovation and new storytelling techniques, Disney wanted to stay relevant in an ever-changing media landscape.

disney metaverse
IRL Disney Credit Leosprspctive

Disney’s decision

Several factors may have contributed to Disney’s decision to dismantle the Metaverse division. The company consulted with his McKinsey & Company to identify cost-cutting opportunities that may have contributed to the decision to cut costs and headcount.

In addition, unfavorable economic conditions and increased competition in the streaming industry may have contributed. Former and current Disney CEOs Bob Chapek and Robert Iger once saw the Metaverse as a worthwhile investment opportunity, but changing market conditions have made it difficult for the company to justify retaining the division. may have become difficult.

It’s unclear exactly why Disney made this decision, but it’s possible that the potential benefits of investing in the Metaverse were weighed against the associated risks and costs.

Not long ago, Disney responded to the explosive growth of NFTs by partnering with VeVe. The collaboration aimed to offer Disney NFTs on VeVe’s mobile digital collection app.

metaverse fallout

Disney’s decision to shut down the Metaverse division could have a significant impact on the development of the Metaverse as a whole. As a major player in the media and entertainment industry, Disney had the resources and expertise to contribute significantly to the development of the Metaverse.

The decision to exit suggests that the potential rewards may not yet outweigh the risks and costs. Despite this, other companies are likely to continue exploring the possibilities of the Metaverse, and it remains to be seen whether Disney’s decision will have broader implications for the industry.

By Jules

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