Alibaba Group is reportedly scaling back its metaverse operations to boost efficiency. The South China Morning Post reported Sunday that Yuanjing, its metaverse unit, laid off dozens of employees.
Yuanjing, Alibaba’s metaverse unit, reportedly cut jobs in its Shanghai and Hangzhou operations. Previously, the unit had a few hundred employees after investing yuans worth billions.
According to SCMP, the unit will remain active. It will continue to focus on creating metaverse applications and tools, and providing related services to its customers.
Alibaba did not return Cryptonews’ request for comment by press time.
Alibaba’s Early Bet on the Metaverse Shows Strategic Vision
Alibaba stepped into the metaverse space around 2022. By March 2023, it increased its involvement through leading a funding round for AR glasses maker Nreal, showing its commitment to enhancing digital consumer experiences.
Janet Wang, head of Alibaba’s luxury division, noted that the tech company’s projects started before “metaverse” became a buzzword. This shows its strategic foresight in transforming digital shopping into an interactive and engaging experience.
For context, the metaverse industry is set for major growth. Projections show a compound annual growth rate (CAGR) of 44.4% from 2023 to 2030. By the decade’s end, the market is expected to reach a $1.6 trillion valuation.
Pro-Crypto Leadership Signals New Era
Last year, Alibaba Cloud, the cloud computing branch of Alibaba Group, partnered with Avalanche, a layer-1 blockchain platform, to launch a blockchain-based metaverse. This partnership aimed to bring innovations to the metaverse by creating decentralized, secure and scalable virtual environments.
Soon after, Alibaba appointed pro-crypto executive Joseph Tsai as its new Chairman, succeeding long-time chief Daniel Zhang.
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