Mark Zuckerberg Leads Company Formerly Known As Facebook Into Tech Transformation

From a New York Times story by Mike Isaac headlined “‘Operating With Increased Intensity’: Zuckerberg Leads Meta Into Next Phase”:

Mark Zuckerberg, the founder and chief executive of the company formerly known as Facebook, called his top lieutenants for the social network to a last-minute meeting in the San Francisco Bay Area this month. On the agenda: a “work-athon” to discuss the road map for improving the main Facebook app, including a revamp that would change how users browse the service.

For weeks beforehand, Mr. Zuckerberg had sent his executives messages about the overhaul, pressing them to increase the velocity and execution of their work, people with knowledge of the matter said. Some executives — who had to read a 122-page slide deck about the changes — were beginning to sweat at the unusual level of intensity, they said.

Facebook’s leaders flew in from around the world for the summit, the people said, and Mr. Zuckerberg and the group pored over each slide. Within days, the team unveiled an update to the Facebook app to better compete with a top rival, TikTok.

Mr. Zuckerberg is setting a relentless pace as he steers his $450 billion company, which has been renamed Meta, into a new phase. In recent months, he has reined in spending, trimmed perks, reshuffled his leadership team and made it clear he would cut low-performing employees. Those who are not on board are welcome to leave, he has said. Managers have sent out memos to convey the seriousness of the approach — one, which was shared with The New York Times, had the title “Operating With Increased Intensity.”

Mr. Zuckerberg, 38, is trying to push his company away from its roots in social networking and center it on the immersive — and so far theoretical — world of the so-called metaverse. Across Silicon Valley, he and other executives who built what many refer to as Web 2.0 — a more social, app-focused version of the internet — are rethinking and upending their original vision after their platforms were plagued by privacy stumbles, toxic content and misinformation.

The moment is reminiscent of other bet-the-company gambles, such as when Netflix killed off its DVD-mailing business last decade to focus on streaming. But Mr. Zuckerberg is making these moves as Meta’s back is against the wall. The company is staring into the barrel of a global recession. Competitors like TikTok, YouTube and Apple are bearing down.

And success is far from guaranteed. In recent months, Meta’s profits have fallen and revenue has slowed as the company has spent lavishly on the metaverse and as the economic slowdown has hurt its advertising business. Its stock has plunged.

“When Mark gets super focused on something, it becomes all hands on deck within the company,” said Katie Harbath, a former Facebook policy director and the founder of Anchor Change, a consulting firm that works on tech and democracy issues. “Teams will quickly drop other work to pivot to the issue at hand, and the pressure is intense to move fast to show progress.”

Mr. Zuckerberg’s repositioning of Meta started in earnest last year, when he began rearranging his bench of lieutenants.

In October, he elevated a longtime friend and colleague, Andrew Bosworth, who is known as Boz, to chief technology officer, leading hardware efforts for the metaverse. He promoted other loyalists, too, including Javier Olivan, the new chief operating officer; Nick Clegg, who became president of global affairs; and Guy Rosen, who took on a new role of chief information security officer.

In June, Sheryl Sandberg, who was Mr. Zuckerberg’s No. 2 for 14 years, said she would step down this fall. While she spent more than a decade building Facebook’s advertising systems, she was less interested in doing the same for the metaverse, people familiar with her plans have said.

Mr. Zuckerberg has moved thousands of workers into different teams for the metaverse, training their focus on aspirational projects like hardware glasses, wearables and a new operating system for those devices.

“It’s an existential bet on where people over the next decade will connect, express and identify with one another,” said Matthew Ball, a longtime tech executive and the author of a book on the metaverse. “If you have the cash, the engineers, the users and the conviction to take a swing at that, then you should.”

But the efforts are far from cheap. Facebook’s Reality Labs division, which is building augmented and virtual reality products, has dragged down the company’s balance sheet; the hardware unit lost nearly $3 billion in the first quarter alone.

At the same time, Meta is grappling with privacy changes from Apple that have hampered its ability to measure the effectiveness of ads on iPhones. TikTok, the Chinese-owned video app, has stolen young audiences from Meta’s core apps like Instagram and Facebook. These challenges are coinciding with a brutal macroeconomic environment, which has pushed Apple, Google, Microsoft and Twitter to freeze or slow hiring.

So, Mr. Zuckerberg has kicked his company into overdrive with a strong message: It’s time to do more with less.

This month, Meta lowered its engineering hiring targets for the year to 6,000, from 10,000 to 12,000, and said it would leave some open positions vacant. Budgets that were once fat are being trimmed, and managers have been told not to expect unlimited head count for their teams. In a memo last month, Chris Cox, Meta’s chief product officer, said the economic environment called for “leaner, meaner, better executing teams.”

In an employee meeting around the same time, Mr. Zuckerberg said he knew that not everyone would be on board for the changes. That was fine, he told employees.

“I think some of you might decide that this place isn’t for you, and that self-selection is OK with me,” Mr. Zuckerberg said. “Realistically, there are probably a bunch of people at the company who shouldn’t be here.”

Another memo circulated internally among workers this month was titled “Operating With Increased Intensity.” In the memo, a Meta vice president said managers should begin to “think about every person on their team and the value they are adding.”

“If a direct report is coasting or a low performer, they are not who we need; they are failing this company,” the memo said. “As a manager, you cannot allow someone to be net neutral or negative for Meta.”

Mr. Zuckerberg is focusing the efforts of those who remain on areas he believes will benefit Meta the most in the long term. Those include the metaverse, messaging, Instagram Reels, privacy, artificial intelligence and higher revenue from products that currently bring in little to none, according to Mr. Cox’s memo, which outlined six “investment priorities” for the company in the second half of this year.

Meta is pulling back in some areas, including low-selling products like the Portal video chat device, which will no longer be offered to consumers and will instead be aimed at businesses. Mr. Bosworth has also halted development of a dual-camera smart watch, according to people with knowledge of the matter, though the company is working on other prototypes. Bloomberg reported earlier on the smart watch.

Just days after the “work-athon” with Facebook managers this month, Mr. Zuckerberg posted an update to his Facebook profile, noting some coming changes in the app. Facebook would start pushing people into a more video-heavy feed with more suggested content, emulating how TikTok operates.

Meta has been investing heavily in video and discovery, aiming to beef up its artificial intelligence and to improve “discovery algorithms” that suggest engaging content to users without them having to work to find it.

In the past, Facebook has tested major product updates with a few English-speaking audiences to see how they perform before rolling them out more widely. But, this time, the 2.93 billion people around the world who use the social networking app will receive the update simultaneously.

It is a sign, some Meta employees said, of just how much Mr. Zuckerberg means business.

Mike Isaac is a technology correspondent and the author of “Super Pumped: The Battle for Uber,” a best-selling book on the dramatic rise and fall of the ride-hailing company. He regularly covers Facebook and Silicon Valley, and is based in San Francisco.

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