With social-distancing measures and remote work being the new norm in light of the COVID19 crisis, teleconferencing services have seen an unprecedented increase in its user count and earnings.
One of the key players in the market, Zoom, recently released their first-quarter earnings in a report on June 2nd, boasting a total revenue of US$328.2 million – a 169% increase from last year. Initially forecasted at US$200 million a few months ago, Zoom earned US$27 million in profits compared to just US$198,000 in 2019 and is optimistic that its annual sales will double this year.
Established in 2011 by founder Eric Yuan, Zoom’s success did not come without setbacks as concerns over security issues plagued the company almost as soon as its usage increased. With a free tier that allows 45 minutes worth of virtual communication, Zoom became the choice platform for users spanning from various walks of life to not only carry out work and schooling commitments but an array of social activities too.
Compared to just 10 million in December 2019, Zoom’s usage has massively grown to 300 million meeting attendees per day, with Kelly Steckelberg (Zoom’s Chief Financial Officer) sharing with investors that this number is expected to exceed in the future.
The increase in usage as well as its convenient features eventually revealed Zoom’s lax security protocol in which a term coined as Zoombombing enabled errant users to hijack meetings and academic classes held over Zoom with lewd photos and a slew of offensive visual/auditory intrusions.
These concerns have led some governments in the region like Taiwan and Singapore to take action to protect vulnerable groups such as school-going children and highly sensitive state-run meetings.
Other shortcomings were also identified where Zoom was accused of misleading the public by way of confusing users with technicalities surrounding the various methods of encryption. Zoom’s eager attempt to make the service Mac compatible was also marred with malware-like approaches that were highlighted by a vigilant software engineer.
In a bid to reassure current and future users, Zoom made efforts to address its shortcomings by announcing a 90-day feature freeze for its updates and new initiatives while they undergo third-party security assessment. Other efforts include their acquisition of Keybase, an encryption company who will work on providing a solution for Zoom’s E2E encryption woes together with a team of Zoom’s engineers channeled to support the goal.
More apparent examples of Zoom’s commitment to improving their security issues can also be seen by the adoption of setting default passwords as well as pre-enabling waiting rooms to minimize meeting intrusions from unintended participants.
With Zoom’s current market value exceeding the combined market values of the four major US airlines by US$59 billion and tripling its stock price to US$208 on June 3rd, it is a considerable improvement from just US$36 per share when the company went public back in April 2019.
Although the world is slowly moving forward by lifting lockdown restrictions in an attempt to revive the economy, the fact that it is being done with prudence would steer people to continue using teleconferencing services. In that respect, Zoom’s utmost priority at the moment is to ensure that their servers stay reliable to allow people to maintain their ties albeit online.
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