SAN FRANCISCO: Verizon has it agreed to buy video-conferencing company BlueJeans Network, a rival of Zoom, for less than $500 million at a time that millions work from home due to widely-enforced lockdowns.
The lockdown orders to contain the spread of the new coronavirus have led businesses across the globe to foster a virtual office environment, leading to a surge in demand for video-conferencing apps such as Zoom, Webex and Microsoft Teams.
BlueJeans, whose conferencing app is used in 180 countries, is already a partner of Verizon and its meeting app is offered to clients under the telecom company’s unified communications and collaboration services.
Zoom, which has a market value of $42 billion, has seen its daily active users jump to 200 million from about 10 million before the pandemic started spreading. Webex registered a record 324 million attendees in March, with usage more than doubling in the Americas, whereas Teams had 44 million users as of March 18.
BlueJeans, which has not publicly disclosed its user numbers, counts big enterprises such as Facebook, LinkedIn and ViacomCBS among its customers. Large banks like Goldman Sachs and Standard Chartered are also known to use BlueJeans.
BlueJeans did not spend as much on product development and customer service despite having a big head start over Zoom. The deal will allow heavy investments in research and development and product integration.
Verizon aims to integrate BlueJeans into its 5G product plan to tap areas such as telemedicine and distance learning. The deal is expected to close in the second quarter. Shares of Zoom reversed course and were trading down one percent, while Verizon shares were up 0.4 percent after the news of the deal.