For the first time in several months, millions of American students sought out their intellectual pursuits and stimulated their little gray cells as the United States school system hit the restart button. Many students returned to the classroom to read Goethe and Wittgenstein, but a lot of kids remained home in their pajamas and attended their classes in their kitchens. That is if they could log in to their Zoom accounts and join their peers for a lesson on Organization Theory in the Age of Deconstruction.
Service Outage in America
On August 24, as many as 17,000 people reported technical issues accessing Zoom Video Communication. These U.S. users were unable to log in to work meetings or attend school classes. Within a few hours, Zoom fixed whatever caused the outage. It did not confirm what the problem was, but it noted that it would continue to monitor its services closer to ensure they remain operational.
"We have resolved the issue causing users to be unable to start and join Zoom Meetings and Webinars. Users are now also able to sign up for paid accounts, upgrade, and manage their service on the Zoom website. We are currently monitoring to ensure that these services are operational,” the company said in a statement.
Zoom CEO Eric Yuan also took to Twitter to apologize for the disruption, writing that “we know the responsibility we have to keep your meetings, classrooms & important events running.”
When the news broke that Zoom was facing technical difficulties, shares of the $80 billion Wall Street darling plunged as much as 6% in intraday trading to $275. The stock rebounded once service was restored, soaring to an all-time high of $295. This is an incredible feat for a company that started 2020 trading at around $65 per share.
How much more room is there for Zoom to grow?
Zoom to the Moon
A lot of companies have entered the video communication realm, including Cisco (Webex), Microsoft (Teams), and Alphabet (Google Meet). These brands offer free versions of their services and enterprise-level premium packages. Will the recent service disruption cause even a fraction of Zoom's 300 million daily meeting participants to migrate to another platform? If security and privacy issues did not spark concerns, then what would?
Industry experts have sounded the alarm about Zoom's information-security infrastructure. Despite its meteoric growth in recent months, the company still faces gaping holes when it comes to security that have yet to be fixed. And, ostensibly, it goes beyond so-called Zoom bombings (uninvited guests enter and interrupt video calls). Zoom has promoted its end-to-end encryption feature (E2EE), which means only communication users can access the information. But research has revealed that this is impossible because the other end is the Zoom server, which means third parties can still access the data.
Privacy has also come under scrutiny. For the most part, its terms of service enabled the company to do whatever it wanted with users' data. In recent months, it has tightened some of its rules after negative media coverage. For instance, Zoom's privacy policy permitted it to collect information from users' meetings (videos, transcripts, and notes) for advertising purposes. The tech firm later revised it so that "Customer Content" could not be used for marketing material.
Zoom is headquartered in California, but it maintains large research and development centers in China, with hundreds of employees. With widespread usage, there have been fears that the Chinese government would use Zoom to its advantage for cyber and intelligence needs. But Zoom has ostensibly taken these concerns seriously as it continually takes steps to distance itself from China. For example, it announced that it would end the process of selling new or upgraded products directly to customers in mainland China.
The company is presumably desperate to remain red-hot in the U.S. market, so it is taking all the precautions. After Facebook confirmed that it would add the Zoom app to its Portal device, the stock has all the momentum moving forward. Will it stay that way? As long as the COVID-19 pandemic makes certain that we are staying home a large chunk of our time, the consensus among analysts on The Street is that Zoom shares will continue to climb.
End of the World
Every time Facebook, Twitter, or YouTube suffers a technical glitch, the world comes closer to the apocalypse. People cannot share cat memes on their walls, tweet obscenities at President Donald Trump, and watch three-hour Joe Rogan Experience podcasts. With millions of professionals working from home and students attending virtual classrooms in their kitchens, did Zoom Video Communication’s U.S. service interruption provide us a glimpse into our future? Since we are going to rely more on Zoom, outages will soon result in mass hysteria and panic.
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Read more from Andrew Moran.
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