Oracle acquires Zoom as cloud customer, defeats no one

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Oracle announced today that it has acquired Zoom as a new major customer. The Oracle Cloud is now being used by Zoom as their infrastructure provider, which should ensure that people can have a smooth video conference 24 hours a day.

This article has been updated. Zoom contacted Techzine to inform us that they are adding Oracle to their infrastructure. They won’t replace AWS or Azure.

Zoom faced a major challenge in the past few months. With the outbreak of the corona crisis, many people suddenly had to work from home, which exploded the demand for videoconferencing capabilities. Zoom saw its users grow from 10 million daily users in December 2019 to 300 million users in March 2020. Zoom told media in March that it had 17 datacenters spread across the world, two new datacenters were still planned at the time. It is unclear whether these have already been realised.

AWS, Azure and Oracle Cloud

In March, Zoom also announced that the datacenters were only sufficient for a basic capacity, which at the time represented a maximum of 50 percent of the total demand. Everything above that had to be purchased externally, for which the company used AWS and Azure. So between now and March, the company negotiated with various cloud providers to see who could best provide the peak capacity. In the end Zoom decided to add Oracle Cloud to the mix. They go for a multicloud strategy with their own datacenters, AWS, Azure and the Oracle Cloud.

Zoom’s CEO, Eric S Yuan, tells Techzine: “We recently experienced the most significant growth our business has ever seen, requiring massive increases in our service capacity. We explored multiple platforms, and Oracle Cloud Infrastructure was instrumental in helping us quickly scale our capacity and meet the needs of our new users. We chose Oracle Cloud Infrastructure because of its industry-leading security, outstanding performance, and unmatched level of support.”

What part of the security of the Oracle Cloud Yuan appeals so much to us we do not know. We are still trying to find out. But given the number of security vulnerabilities Zoom has had to deal with lately, it is good that security is high on the agenda.

Oracle was an outsider

Azure and AWS were doing business with Zoom in March, Oracle has now hijacked this customer from under their noses. We asked whether Zoom was already an Oracle customer; according to the Oracle spokesperson, Zoom was previously only a Netsuite customer. Netsuite is an ERP solution for SMB’s and larger companies. In April, a video appeared on YouTube in which Larry Ellison, founder, chairman and CTO of Oracle, indicated that Zoom was essential for the Oracle business, because video conferencing is an essential part of it. It seems that the founder personally interfered with this deal.

Tip: Also read our comparison between all videoconferencing services

Zoom has reached out to Techzine to inform us they are using multiple cloudproviders for their infrastructure; AWS, Azure and the Oracle Cloud. They are not replacing vendors with the Oracle cloud.