Recent efforts by Meta Platforms to outbid its peers for star AI researchers and engineers by offering salary packages worth hundreds of millions of dollars to join its new artificial intelligence (AI) division have now entered a hiatus after spiralling costs drew investor scrutiny.
The freeze on new hires, which went into effect last week, coincides with a broader restructuring of the group and what Meta describes as some “basic organisational planning”.
Recent restructuring inside Meta has divided its AI efforts – dubbed Meta Superintelligence Labs - into four teams, and during the hiring freeze, current employees are prohibited from moving across teams inside the division.
It’s understood that one group will focus on A.I. research; one on a potentially powerful A.I. called “superintelligence”; another on products; and one on infrastructure such as data centres and other A.I. hardware.
A Meta spokesperson told the market that the pause was simply “creating a solid structure for our new superintelligence efforts after bringing people on board and undertaking yearly budgeting and planning exercises”.
While there’s no indication as to how long this pause will last, there’s growing market speculation that Meta is looking at downsizing the A.I. division overall after having grown to thousands of people in recent years.
The company is also understood to be actively exploring the use of third-party artificial intelligence models that could include building on other “open-source” AI models, which are freely available, or licensing “closed-source” models from other companies.
In addition to igniting a Silicon Valley poaching war by offering mouthwatering salaries, investors and analysts alike have also been scratching their heads to make sense of the way Meta has pushed the pace of the AI talent war.
Analysts have voiced concerns about the scale of leading tech firms’ investments, with some singling out Meta’s fast-rising stock-based compensation costs – plus salaries exceeding $100 million for prized researchers - as a potential threat to shareholder returns.
Some market analysts have also raised concerns over Meta’s deployment of so-called 'reverse acquihires' to strip startups of key leaders.
Reverse acquihires are a trend where big tech companies bypass traditional acquisitions by directly hiring a startup's key employees and licensing its technology, rather than buying the entire company.
Meta is understood to have recently poached talent from Alphabet’s Google, Apple and Anthropic.
While Meta’s aggressive hiring strategy has caught headlines in recent months for their high price tags, other megacap tech companies have also been pouring billions into AI talent, as well as R&D and AI infrastructure.
However, the sudden AI hiring pause by the owner of Facebook and Instagram has only heightened market concerns that investments in AI are moving too fast, and this has been reflected in a broader sell-off of U.S. technology stocks this week.
