Today’s top tech stories:
Zoom’s not done
Over the last pandemic-stricken year, Zoom Video Communications Inc. has grown from a scrappy upstart into a $111 billion video-conferencing behemoth, central to the lives of millions of remote workers and other socially distant users.
As Covid-19 vaccination rates rise, the obvious question for the company is what’s next? The answer could be a lot more than video chat.
This year is shaping up to be a pivotal time for Zoom. Industry-watchers have questioned whether demand will ebb for the company’s core service as the economy haltingly reopens and users complain of “Zoom-fatigue.” But there are signs that its conferencing business will be durable.
Speaking from personal experience, the vast majority of my external meeting calls are now conducted on Zoom. I’m not alone. The combination of its ease of use, reliability and pervasiveness has made Zoom the go-to standard for corporations. That’s showing up in the numbers, too. The latest credit card data shows spending with the company is still surging.
According to KeyBanc Capital Markets, Zoom’s share of the video-conferencing market rose by 10 percentage points to 76% in the June quarter from the March quarter, with sales growth rising in each of the three months.
At this point, it seems large technology companies are giving up on trying to beat Zoom. For example, Alphabet Inc.’s Google Meet recently added a one-hour cap for non-paying group calls. The end of the technology giant’s unlimited free service for three or more users could drive additional customers toward Zoom.
And then there’s Zoom’s business beyond video conferencing. Take the relatively sleepy market of corporate phone systems that has been traditionally dominated by Cisco Systems Inc. and Avaya Holdings Corp. Zoom Phone has been rapidly gaining market share in the category. And two recent acquisitions should accelerate its progress.
In June, Zoom announced an agreement to acquire Kites GmbH, a startup that specializes in real-time language translation. And last month’s $14.7 billion purchase of call-center software maker Five9, which has 2,000 global customers, opens up a large new client base as well.
Then there’s last month’s dual-launch of Zoom Events and Zoom Apps. Events enables corporations to host large internal virtual gatherings or trade shows, and could be a hit. But the Apps platform may be even more important to the company’s future.
Already, there are more than 50 apps from games, brainstorming whiteboards and cloud storage workspaces to real-time surveys—all built on top of Zoom. As a larger ecosystem of apps develops, it could further entrench the Zoom’s dominant position and increase the stickiness of its service.
With Zoom engineering all these products in adjacent markets, its competitors should be worried. It’s clear the company isn’t satisfied with conquering the video-conferencing category. There is more to come. —Tae Kim on the Bloomberg Opinion team in New York
If you read one thing
The new head of the Securities and Exchange Commission wants more oversight on cryptocurrency to protect investors, he told Bloomberg Businessweek in his first extensive interview on crypto since taking the job.
And here’s what you need to know in global technology news
SoftBank has built a $5 billion stake in pharma giant Roche, betting on its ability to use data to develop drugs.
Facebook has disabled accounts tied to an NYU research project designed to provide transparency into political advertising online.
Google is approving about 85% of employee requests to work remotely or to transfer locations once its offices reopen.
Match gave an upbeat revenue forecast, but its shares fell about 4% in extended trading as the spread of the delta variant has threatened the dating market.
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August 04, 2021 at 05:45PM
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Zoom Won't Stop at Video Chat Dominance - Bloomberg
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