One Problem for Meta's Anti-China Stance? 'Made in China' Hardware

Companies like Apple have moved hardware production to places like India and Vietnam, reports the Washington Post. But Facebook 'has hit walls, say three people familiar with the discussions, who spoke on the condition of anonymity to describe internal conversations.'

Until recently, the people said, Meta executives viewed the company's reliance on China to make Oculus virtual reality headsets as a relatively minor concern because the company's core focus was its social media and messaging apps. All that has changed now that Meta has rebranded itself as a hardware company, the people said. Beyond last year's name change from Facebook to Meta, the company has undertaken a broad internal reorganization, launched augmented-reality smart glasses, and is building a connected device that could be worn on a person's wrist. In October, the company introduced Meta Quest Pro, the first in a new line of headsets built for collaboration.

Internal concerns about the hardware push intensified last year, when some executives worried that the anti-China strategy...would hurt its business ambitions and be viewed by the public and regulators as hypocritical, given the company's growing reliance on China for its plans....

Executives also looked, unsuccessfully, for ways to move manufacturing of Oculus to Taiwan. 'Meta is building a complicated hardware product. You can't just turn on a dime and make it elsewhere,' said one of the executives.... While the original smartwatch plan was abandoned, the company continues to work on a wearable device for the wrist, according to two people familiar with the company's plans. 'At present, Meta's consumer electronics hardware is manufactured in China but we are constantly reviewing and exploring supply chain opportunities around the world,' spokeswoman Ha Thai said....

Executives are still hoping the hardware-focused rebranding will shift the conversation away from criticism of its social media business, said two of the people. But they are well aware that relying on China for a growing suite of virtual reality headsets, smartwatches and other hardware will invite a new set of political challenges. Companies dependent on China for manufacturing have faced criticism over shipping jobs overseas as well as environmental and labor rights issues, and have had their businesses impacted by trade wars and other political escalations.

'You trade in one set of problems for another,' said one of the people.
The article also notes that Meta has quietly funded the nonprofit 'American Edge' that 'runs online advertising and other campaigns that are critical of China and of TikTok, the Chinese-owned social media app.

'[S]ome Chinese analysts have argued that Meta was resorting to desperate measures because it feared TikTok owner ByteDance's growing dominance in short video.'

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