Owning Meta Platforms (NASDAQ:META) stock was one of the biggest mistakes of 2022. It tossed tens of billions of dollars in developing something it couldn’t even define, “the metaverse.”

It’s one of the best deals of 2023, because all that effort is being redirected and called “artificial intelligence.”

Shares that were worth nearly $380 each in August of 2021 plunged to a low below $91 last Halloween but are now worth $273 and are headed higher.

Meta is still down 17% from two years ago. But the market cap has recovered to $700 billion. Co-founder Mark Zuckerberg’s fortune is approaching $100 billion again. He just turned 39.

A Closer Look at META Stock

Meta’s AI effort has a “secret sauce,” and it’s the same one Zuck used to make the company a “Cloud Czar” in the 2010s.

It’s open source.

By releasing its large language model, called LLaMa, and Massively Multilingual Speech technology to open development, Meta has “opened the Pandora’s Box of AI.” According to critics, allowing anyone to work with technology leaders of the developing world insist is too dangerous for such an approach.

The critics have a point, but the criticism is overblown. The internet itself developed as an open system, as did the cloud. That the more hands on the code, the faster it rises, is a proven fact. The creator of ChatGPT, OpenAI, started life as an open, non-profit foundation.

Zuckerberg wasn’t invited to the White House Summit on AI last month because Meta wasn’t considered a leader in the space. But with almost half the world’s people on at least one of its platforms, and its open software available for use, that may not be the case for long.

AI in the Cloud

Meta’s cloud, now with 21 data centers, is being redesigned for the AI boom. It’s going to have a significant place in the new AI world, if only by delivering the product and bringing billions of people to it. This assumption is making Meta the hottest stock this side of Nvidia (NASDAQ:NVDA).

When Zuckerberg calls 2023 his “year of efficiency” this is really what he’s talking about. It’s not the highly publicized layoffs, but optimizing both Meta’s cloud network and AI software stack. Meta is buying time so that when the boom takes off, Meta is in the center.

Rivals like Alphabet (NASDAQ:GOOG)(NASDAQ:GOOGL) know this approach can succeed. They’re used it themselves and know Zuck has as well.

They’re making calls for regulation aimed at keeping “bad actors” away from large language models and chatbots. It can also be seen as a call to keep the technology in the hands of a few big companies that can afford the price of regulation.

The Bottom Line

Zuckerberg’s approach to AI may change the world more than AI itself. He has indeed opened Pandora’s Box, and that box can’t be shut.

But the box was already open. The box was opened when the U.S. government allowed the creation of commercial Internet Service Providers (ISPs) in 1989/  It was opened when Tim Berners Lee published the paper that became the World Wide Web.

Zuckerberg and Meta are just riding the wave.

At the time of publication, Dana Blankenhorn directly owned shares in NVDA and GOOGL.