Meta Launches $50M ‘Horizon Worlds’ Content Fund Amid Financial Challenges for VR Studios

Today, Meta made headlines by introducing a $50 million Creator Fund aimed at boosting content development within Horizon Worlds, its flagship social gaming hub. The initiative speaks to the challenges faced by established studios producing standalone VR apps for the Quest ecosystem, as the user demographic starts to shift.

Since the Oculus Rift CV1’s debut in 2016, standalone VR experiences have been pivotal for Meta’s platforms, driving user engagement upwards over the years. Despite their importance, Meta is now betting on its vision of a unified ‘metaverse’—a connected universe of interactive experiences—as the cornerstone of future success.

Horizon Worlds represents Meta’s ambitious foray into constructing this metaverse. It functions both as a playground and a stage for creation, welcoming users to build and share within the community. Given Meta’s DNA as a social media titan, fostering interactions is central to this platform’s design.

Despite Horizon Worlds being available on VR for a few years, it hasn’t reached the user engagement Meta hoped for. In response, the company expanded access to mobile and desktop users to widen its appeal. However, this broader accessibility means creators must navigate the tricky terrain of making content that resonates across VR and non-VR platforms.

A key stumbling block has been the lack of compelling content to keep users hooked on Horizon Worlds. Without captivating activities or experiences, user retention poses a real challenge. To address this, Meta has been working on enriching the platform by inviting more creators to contribute and even authoring some first-party games itself.

The new $50 million fund aims to change the tide by rewarding creators who put together worlds that boost user visits and retention. Meta has detailed how this fund will work, promising monthly bonuses tied to engagement metrics like time spent, retention rates, and in-world transactions, offering multiple paths for creators to increase their earnings.

Alongside the fund, Meta introduced the Horizon Worlds desktop editor, a fresh development tool that allows creators to work on projects offline and harness computer processing power—a nod to the workflow of traditional VR developers using engines like Unity.

In this drive to elevate Horizon Worlds as a pillar of its virtual ecosystem, Meta’s strategic direction mirrors the wild success of platforms like Fortnite—a social gaming behemoth famed for its extensive reach and player loyalty. The company’s CTO underscored the mobile version of Horizon Worlds as critical for aligning with its long-term ambitions in XR.

Nevertheless, while this new initiative seems promising for Horizon World enthusiasts, it coincides with troubling times for developers of self-contained VR and MR apps—the very foundation that sustained Meta’s headset appeal. The platform changes, geared towards spotlighting Horizon Worlds, have pushed distinctive apps farther from users’ sight, sometimes sidelining quality creations in favor of lesser alternatives.

Many third-party developers feel the effects of these shifts acutely, citing reduced app visibility and revenue share cuts as factors threatening their business viability. A number of established studios reliant on VR app sales to innovate and sustain operations have downsized their teams, attributing cutbacks to slowing performance on Meta’s platform and wider economic pressures.

It’s worth noting that Meta hasn’t completely turned its back on traditional VR developers. Over time, it has invested millions to cultivate engrossing VR content and launched programs to support indie developers. Yet, even as Meta encourages new genres like MR, some developers remain wary of the platform’s direction, viewing it as an unstable landscape for investments.

Meta argues that the downturn in standalone VR app success isn’t just due to frequent strategic shifts but also stems from a changing user base inclined towards free-to-play models over paid apps. Pointing to the overwhelming success of ‘Gorilla Tag’—a free-to-play sensation that soared to $100 million in revenue—the evidence suggests that lowering entry barriers can indeed fuel critical mass and engagement.

Further advancements in the VR free-to-play domain are exemplified by ventures like Digigods, which has secured $2.6 million funding, buoyed by its thriving free-to-play user-generated content platform.

Meta stresses that premium VR apps still hold pivotal roles in its broader Horizon strategy. The company assures ongoing investment in VR content funding, despite recent disputes over the extent of this commitment.