It’s not been a good week for tech stocks as growth in the digital ad market slows and investors look for new places to put their money: Meta, Alphabet, Snap and Microsoft and the like had $550bn knocked off their market valuations.
Elon Musk bounded in (with kitchen sink, below) to protect his $44bn Twitter takeover and “free the bird” as he called it by posting a letter addressed to “Dear Twitter advertisers” in which he said he wants Twitter to help society out of its echo chambers and “be the most respected advertising platform in the world that strengthens your brand and grows your enterprise.”
But advertisers are not flocking to social platforms at the rate they have been, and at the same time, IPG’s digital powerhouse R/GA has lost $7-10m this year and has just announced a restructure.
Much of this can be blamed on the cost of living crisis, but a lot is also due to an over-hyped metaverse and a blind faith in crypto and NFT as everyone fights to be the first to adopt whatever shiny new reality was on offer.
These companies are all still making vast amounts of money, however – even Facebook is still growing outside the US and Europe – and most of the world is now interacting online, even if it’s not yet at the elevated level that Mark Zuckerberg dreams of.
This montage of top execs mostly talking down the metaverse at the WSJ’s Tech Live event shows just why those stocks are tumbling.