Zoom conquered video chat — now it has even bigger plans

Nobody at Zoom seems to have a good explanation for why the service is so popular. At the moment, the answer's easy: Coronavirus has forced countless employees to work from home, and remote employees need a conferencing tool. But since long before remote work went viral, people have loved Zoom. More than they loved other video chat apps. More than it even seemed possible to love a video chat app. And nobody seems to know why.

The best answer I got was a number: 150 milliseconds, the maximum latency before conversations feel unnatural. Zoom works really hard to stay under 150 milliseconds, Chief Product Officer Oded Gal said. Or maybe this: Rather than optimize the connection for all devices — which means optimizing for the worst, slowest one — Zoom tends to each individually. "We look at the operating systems, look at the device, tune the communication specifically for that network or for that device," said Harry Moseley, Zoom's chief information officer. But neither of them thought their answer actually got to the core of the service's appeal.

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More often, Zoom executives said people like Zoom "because it just works." They like that instead of worrying about dial-ins and spending half the meeting making sure everyone can hear, they can just click a link and be dropped in the conference. They like that it works just as well on mobile. They like how easy it is to share their screen. They like that there's no awkward mismatch between sound and picture.

Whatever the reason, there's no doubt people love Zoom. Net Promoter scores, social media mentions — pick your metric and Zoom usually comes in first. It's hard to know how Zoom compares to tools like Skype and Hangouts, which are baked into massively popular suites of tools, but people who get to choose their video chat app overwhelmingly choose Zoom.

When I spoke with Moseley, we'd barely sat down at a cafe before two people noticed the Zoom pin on his suit lapel and launched into a rave about the app. "We are proudly powered by Zoom!" one of them said. Then he turned to his friend: "It's a great provider, don't you think?" Moseley assured me these guys weren't plants, and said, not-so-bashfully, that this happens all the time. He seemed somehow unsurprised that people could have such strong allegiance to a video chat app.

In a world swimming with tools that serve ostensibly the same purpose, Zoom has somehow become the gold standard. "They have the product, and they do a great job of marketing the product," said Rich Costello, an analyst at IDC. He said even competitive vendors are curious about how Zoom pulled this off.

As Zoom has continued to distance itself from the video chat crowd, the world has also twisted in ways that benefit Zoom. Coronavirus has spiked the number of people working from home, adjusting to taking meetings through webcams. But even the larger trends favor Zoom: 4.7 million Americans now work from home at least half the time, and according to one study, half the U.S. workforce holds a job that is compatible with at least some telecommuting. For those employees, Zoom is more than just a way to have meetings with teams in other offices. Zoom is the office.

Inside the company, Zoom's ambitions match the moment. Its executives believe they can do more than just make great videoconferencing — they think Zoom can change, and own, the way businesses communicate going forward. They're launching new communication tools to replace desk phones and instant messenger, new AI features designed to make meetings more efficient, and working on ways to use bleeding-edge tech to make distributed workforces feel closer together. Think of it this way: WeWork wanted to reimagine the office as a different kind of place. Zoom wants to reimagine the office as no place at all.

By now, the Zoom history is well-worn and vaguely mythological. Eric Yuan, dissatisfied at Cisco, mucking around in years of technical debt trying to make Webex work, quit his job in 2011 to go build something better. He recruited a team, came up with a plan, raised some money and disappeared. Two years later, poof, Zoom is born. In retrospect, Yuan comes out looking like the sage fortune teller, patiently waiting to get it right. In reality, he said, it was chaos. "I never thought it would take two years," he told me — over Zoom, of course. "We had lots of engineers! I was not patient — I thought we'd work hard and in one year, we'd have something." He wanted to build the whole thing from scratch and had no idea how long it would take.

Back to the mythology: Zoom launches in 2013, takes off, gets big, raises money, gets bigger, more money, more bigger, and eventually decides to go public. As the company got ready for its IPO roadshow last year, Yuan made a decision: He wasn't going on the roadshow. (Yuan said this, too, was hairier than it seems in retrospect: "Not only did I scare people, I even scared our board of directors.") He did most of his investor meetings through Zoom, bringing in other employees to do virtual demos and betting the product would work well enough to convince the bankers. It did. Though it probably also helped Zoom's case that it was the rare tech company that was both growing fast and already profitable.

Fast-forward a few months — more growth, rising stock — and here we are. There have been a few blips along the way, like last spring, when a security researcher found an issue in Zoom's Mac app that would let any website add a user to a Zoom call and activate their camera without permission. The problem even affected users who had uninstalled Zoom from their computer, forcing Apple to release a patch to fix it. It was a core test of Zoom's relentless focus on simplicity — the same feature that made it possible to click a link and suddenly be in a conference also made the system penetrable. Ultimately, Zoom tweaked the way it handled permissions and uninstalls going forward. And then kept growing.

Right now, Zoom is big, it's profitable, and it's growing like crazy. It cracked Okta's list of the 15 most-used business tools in 2019, while also being one of the fastest-growing. According to one estimate, the company added more users in the first two months of 2020 than in all of 2019. In early March, it reported 61% more business customers than the year prior, with revenue up 88% year-over-year. More than 10 million people join a Zoom meeting every day. And, of course, the coronavirus bump has been significant: CFO Kelly Steckelberg recently told Yahoo Finance that at the end of January, Zoom was headed for 100 billion annual meeting minutes, "and that's up pretty significantly since then." For the last several days, it's supplanted TikTok as the #1 free app in the iOS App Store.

Yuan said that in some ways all this success has made it harder for Zoom to keep focused. This market is going to get bigger, and more competitive. Most people still don't work remotely, still use crappy conferencing tools, still don't live in the future Zoom imagines. Yuan said he's still focused on getting the basics right. "We are very paranoid," Yuan said. "Even if we're looking at market share, usage … we're ahead of our competitors, but we're not there yet."

At the same time, Zoom seems to sense that its opportunity is much larger than just providing a way to talk to someone on camera. "We do want to be the number one communication company," Gal told me. Then he paused for a second. "I don't know if you can quote me on that. Actually, yeah, you can quote me on that." That means replacing employees' desk phones with his team's latest product, Zoom Phone, which makes phone calls as easy as video ones. It means figuring out how to turn Zoom into a powerful text-chat platform. It means integrating with calendar apps, contact systems, sales trackers, education platforms and more. Zoom's master plan starts with video, but it ends in an all-encompassing communication tool for the entire workforce.

There's no guarantee that Zoom's success in video will translate elsewhere, of course. "Parlaying that into, say, the telephony side could be a challenge," IDC's Costello pointed out. Expanding internationally, where its brand is less known, will be difficult too.

On the product front, Zoom's challenge will be to do much more without losing the just-works-ness users love. Successful apps tend to try to add more features, which causes those apps to be less useful and more frustrating, which causes people to like them less. Which causes people to leave and try to build a better thing from scratch. Yuan knows first-hand how easy it is to start with something great — and end up with Webex. One way Zoom has tried to combat this is to turn off most of its additional features by default. "If you add it yourself, as a user, and you want to use it, you'll be more conscious about how to use it," Gal said.

The most important way to keep users happy, though, is to make sure video keeps working. Gal likes to compare Zoom's mission to that of Google's search team. "They had this idea of the web crawlers," he said. "They made the best search. They never stopped! Until today, they have huge teams still improving their search. Same for us with video. We did a good job initially, we built the best video experience. We never stopped."

There are plenty of video problems left to solve, too. As billions of new people come online, in mobile-first environments where data is expensive and slow, Zoom has to adapt the way it handles calls. Gal said he's also thinking about eye contact, and how to avoid the fact that most of the time on a video call, both sides appear to be staring at each other's sternum. Tiny things that would never matter in a real-life meeting, like the clack of one participant's keyboard, become catastrophic on video.

Zoom hopes it can be the one to solve all these tiny annoyances of videoconferencing life. Doing so is part of the company's ethos; Yuan and others say that one reason Zoom has been successful is that it simply cared more about the video experience than others. "With business tools, video was not the main thing. It was a checkbox feature: yeah, we have video." In 2011, that was true. Now, as Zoom grows, its competitors are doubling down on their own video systems, meaning it needs to fight harder to stay ahead.

Luckily, the company is not short of ideas on how to make video calls more interesting and fun — maybe at the risk of doing too much. What if you could apply a fake green-screen-style background, so nobody would know you're taking that important call from your bedroom? (Already possible.) What if that background could be video, and thus even more convincing? (Coming soon.) What if you could talk to someone, and have Zoom spit out a transcription right after your call ends? (Doable already.) Even better, what if it could automatically send you just the key points and action items? (Also doable, but pretty basic.) What if your video chat could automatically block out passing cars or screaming children? (Yes, please.) What if you could talk to someone, each of you in your own language, and Zoom could translate in real time? (Someday!)

To hear Yuan describe it, he's not really building a video chat service at all. He's building the metaverse. "Imagine a world where, anywhere, any device, one click, you feel like you're in the same conference room … you can see each other and shake hands." He pointed at my coffee cup, and wondered aloud how great it would be if he could smell it, too.

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Everyone at Zoom knows this is a long-term plan, and the company seems willing to get there slowly. Yes, they want to push users to use video whenever possible, but they'll tolerate phone calls for a while longer. "I don't think people love" the tools they already use, Yuan said, "but they're locked into them — they've used them for 10 years, 20 years. For sure they're going to change to the new world, but it takes some time."

The world seems to be moving ever closer to Zoom's vision, though, brought on by a global pandemic and a series of shifts in how, when and where people work. The distributed workforce is no longer a pipe dream propagated by people who don't want to pay San Francisco real estate prices. It's an increasingly real part of every workforce. The virtual-office battle is just beginning — but at least for now, Zoom appears to be way ahead.