Disney layoffs: Metaverse division gets the axe
Disney will begin the first round of layoffs of 7,000 employees within the company, and according to a report, the metaverse division is the first to bid farewell.
According to a report from The Wall Street Journal, Disney has laid off its metaverse division in the first round of layoffs. The metaverse division was announced last year by the former CEO Bob Chapek, and now the division is being laid off under the new management of Robert Iger.
Chapek believed in the metaverse and wanted to implement Disney services to the upcoming technology. After seeing Facebook's investments in the area, Chapek got more excited, but his excitement lasted until being replaced by Iger. Robert Iger wants to guarantee a stable future for the company, so he recently announced the layoffs of 7,000 employees from every branch of the company.
The metaverse division consists of roughly 50 members
Disney had a relatively small division dedicated to the metaverse, roughly 50 members. Employees were developing metaverse strategies and planning the company's upcoming moves in the field. The division's head, Mike White, a former Disney consumer products executive, will remain at the company, but his new role remains unclear.
Mike White was involved in several internal efforts, including a program similar to Amazon Prime. It would connect customer data across numerous Disney channels, including streaming service Disney+, online retail operations, and smartphone apps that visitors to Disney's theme parks use to purchase food, goods, and other products. The Wall Street Journal mentioned that it was also abandoned.
Disney is trying to reduce corporate spending and boost some cash. With 7,000 layoffs, the company plans to cut $5.5 billion in costs, including $3 billion in content spend. The metaverse division is only the beginning, and almost 6,950 more people will be left in limbo. Moreover, almost none of the employees are safe, as it concerns every department, from parks and resorts to ESPN, other media outlets, and more.
This means that Disney has suspended its research into the metaverse's future. Instead, the company might focus on what it owns right now and try to stay idle for at least a while until it boosts the free cash flow and reduces enough expenses.
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