Meta has struggled at selling anything other than ads. Will AI be different?
Meta is facing significant challenges in expanding its business beyond advertising, particularly in the enterprise sector. Experts suggest that the company needs to develop its infrastructure and workforce to compete effectively in cloud computing. Despite raising its AI-related capital expenditure guidance, Meta has yet to establish a strong presence in the cloud market.
- ▪Meta has primarily focused on direct-to-consumer sales, making enterprise sales a challenge.
- ▪The company's Workplace offering has been described as half-hearted due to its social media focus.
- ▪Meta's CEO has not committed to entering the cloud computing market unless excess capacity is identified.
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Selling technology to enterprises could be a much bigger challenge. Shashi Bellamkonda, research director at Info-Tech Research Group, said Meta has a lot of work to do to build an enterprise business "from the ground up, because the company is so focused only on direct to consumers."Bellamkonda characterized Meta's Workplace offering as seemingly "half-hearted, because they were so focused on only the social aspect of Facebook," which makes money from ads. To successfully compete in the enterprise, particularly in cloud, Meta will have to "ramp up processes, platforms, technology, and most importantly, the manpower" required to operate, maintain, and sell products and services, Bellamkonda said.
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