tech
Meta has struggled at selling anything other than ads. Will AI be different?
Meta is making a major push to expand its business beyond online advertising, but past efforts show that success is far from guaranteed.
TL;DR
- Meta is launching subscription services for its AI app and website, testing them in Singapore, Guatemala, and Bolivia.
- The company is also considering a cloud computing business, which could position it against tech giants like Amazon, Microsoft, and Google.
- Advertising accounts for nearly 98% of Meta's revenue, highlighting a long-standing reliance on this single business segment.
- Previous non-advertising ventures, including the Portal device, Oculus VR, Libra cryptocurrency, and Workplace, have largely failed to achieve success.
- Analysts are cautiously optimistic about AI subscriptions, with some projecting significant revenue contributions by 2030.
- Challenges include Meta's focus on direct-to-consumer markets and the difficulty of building enterprise-level businesses and cloud infrastructure.
- Meta's increased capital expenditures on AI infrastructure signal a significant investment in the technology.
- Past attempts by other companies to enter the cloud business using existing data center capacity have not been successful.