Facebook Inc. Chief Executive Mark Zuckerberg said the company would change its name to Meta to reflect growth opportunities beyond its namesake social-media platform in online digital realms known as the metaverse.
“Over time I hope our company will be seen as a metaverse company,” Mr. Zuckerberg said Thursday. He unveiled the new name for the company that also includes Facebook, Instagram, WhatsApp and other products at Facebook’s annual developer event.
At the Facebook Connect event Thursday, he detailed his vision for the metaverse that he sees as key to the social-media giant attracting a younger audience.
“We’ve gone from desktop to web to phones, from text to photos to video, but this isn’t the end of the line,” Mr. Zuckerberg said at the social-media giant’s annual developer forum called Facebook Connect. “The next platform and medium will be even more immersive and embodied internet where you’re in the experience, not just looking at it, and we call this the metaverse.”
Facebook is already investing heavily in creating that new reality of shared online spaces inhabited by digital avatars, with projects ranging from virtual-reality glasses to an e-commerce platform.
The company is adapting its structure as well. Mr. Zuckerberg said on an earnings call Monday that Facebook Reality Labs, which encompasses augmented-reality and virtual-reality products and services, is becoming a separate reporting unit and that spending for it would reduce this year’s total operating profit by $10 billion. “We expect to spend many billions of dollars for years to come,” Mr. Zuckerberg said Thursday.
The metaverse that he has been increasingly promoting also gives him a comfortable topic to focus on as Facebook faces intense criticism from lawmakers, researchers, and users over revelations in The Wall Street Journal’s Facebook Files series, which showed that the company knows its platforms are riddled with flaws that cause harm. Mr. Zuckerberg has said the criticism paints a false picture of the company he co-founded.
At Thursday’s event the Facebook chief addressed the decision to discuss emerging plans while the company faces such scrutiny. “I know some people will say this is not a time to focus on the future,” Mr. Zuckerberg said, but argued that it is important to move forward even if mistakes are made along the way.
He said on Monday’s call that the company was “retooling our teams to make serving young adults their North Star.” That could dent user growth in some of Facebook’s traditional businesses in the near-term but would open new opportunities, he said.
Bank of America analysts in an investor note Tuesday called the metaverse a compelling concept that “has a reasonable chance of mass market adoption with Facebook’s strong backing.” But they cautioned that the company’s ambitions in this area would likely take many years to come to fruition. “Long-term holders will need to have a strong belief in Facebook’s vision for the metaverse business model to want to hold the stock,” the analysts said.
Facebook is one of many big tech companies with metaverse-related objectives. Microsoft Corp., Nvidia Corp., Unity Software Inc. and others have said they are developing tools, services or content for the metaverse.
Some early iterations of the metaverse already exist. Roblox Corp. and Epic Games Inc. have hosted virtual concerts with millions of attendees who appeared as avatars. Similarly, virtual-reality applications such as “Rec Room” and “AltspaceVR” let people socialize as avatars. Some tech-industry forecasters say in the future such experiences will evolve to become almost life-like.
Mr. Zuckerberg has said it would take time before the metaverse becomes lucrative for his company. “Building the foundational platforms for the metaverse will be a long road,” he said on Monday’s call, adding, “Later in this decade is when we would sort of expect this to be more of a real business story.”
At Thursday’s event, the Facebook chief took an implicit swipe at rival Apple Inc. for the fees it charges on its App Store. “I believe that the lack of choice, high fees are stifling innovation and stopping people from building new things and holding back the entire internet economy,” Mr. Zuckerberg said. He has groused for years that Apple holds too much sway over the social-media giant’s business. Apple has defended its App Store policy as benefiting consumers.
“We want to serve as many people as possible,” Mr. Zuckerberg said. “That’s the approach that we want to take to help build the metaverse, too.”
He said the company is building a social platform for the metaverse called Horizon, a beta version of which started rolling out last year. Now, Facebook is working to bring Messenger calls to virtual reality, enabling people to more easily explore virtual worlds or join games together.
The company also plans to add the ability for creators to connect different physical locations in augmented reality, and Mr. Zuckerberg said Facebook is creating a marketplace for its Horizon platform where creators can sell and share digital items. Office-related Horizon features also are in development, he said.
Moving into a more digital world would have societal benefits, Mr. Zuckerberg said. “If you travel for work and working within the metaverse means that you just take one less flight each year, that’s probably better than almost anything else that you can do for the environment,” he said.
Facebook said earlier this month that it plans to create 10,000 jobs in Europe over the next five years to work on metaverse-related endeavours. The company also has introduced Oculus-branded virtual-reality headsets, and it joined with Ray-Ban to develop smart sunglasses that went on sale for $299 last month. In August, Facebook launched public testing of Horizon Workrooms, an app that lets people wearing its Oculus Quest 2 headset enter virtual offices as avatars and participate in meetings while seeing their computer screen and board.
“I view this work as critical to our mission because delivering a sense of presence—like you’re right there with another person—that’s the holy grail of online social experiences,” Mr. Zuckerberg said Monday.
Write to Sarah E. Needleman at sarah.needleman@wsj.com