Zoom Seeks its Place in the Hybrid World: Underdog or One-Hit Wonder?

Zoom wants to prove that its success during the COVID pandemic wasn’t a fluke. It’s joining the AI race, where it once again finds itself in the underdog role.

There’s no lack of color in Zoom’s London office. The characteristic Zoom blue alternates with purple walls. Zoom knows its music classics: the meeting rooms are named after British rock legends like Radiohead, Arctic Monkeys, and Blur. A year ago, we were here for a tour of the Experience Center, now Zoom’s annual high mass Zoomtopia is the occasion.

Zoom is at a crucial turning point in its young existence. Five years ago, the world got to know Zoom when the COVID crisis forced us into virtual calls with family, friends, and colleagues. Zoom had made this its specialty long before the pandemic. Zoom made a spectacular rise and earned its place at the honor table of the tech industry.

Today, the world has changed. Virtual meetings are still daily routine for many office workers, but hybrid work has become the new norm. During Zoomtopia, Zoom wants to convince friends, foes, and the press that it will remain relevant in the hybrid world too. “We’ve always been hybrid,” says Steve Rafferty, head of the EMEA region.

From Video to AI

Turning around public perception proves to be not easy for Zoom. The company is associated with video meetings, and it actually wants to move away from that. ‘Video’ was even officially dropped from the name. “Many people don’t see the full picture of our platform. We can do much more than video,” emphasizes Head of Government Relations Drew Smith. The enormous 8K LED screens in the boardroom show that video hasn’t completely disappeared from the DNA.

Now that video meetings are no longer exciting, Zoom wants to ride the AI waves. With AI Companion, it has created its counterpart to Microsoft Copilot. During Zoomtopia, it launches AI Companion 3.0: these days, an announcement is not complete without a new version number.

“We’ve grown from secure and scalable communication. Now we want to bring human interaction and AI together,” says Rafferty. “Every second counts in a business environment. By outsourcing work, people can focus on achieving results faster. It’s easy to shout that AI is the future. For us, it’s about how people and agents will work together”.

Digital Overload

The third version of AI Companion is meant to distinguish itself from previous versions because it “turns conversations into actions,” we hear from Smita Hashim, who dials in virtually. In Zoom’s vision, you have an AI agent that, among other things, follows meetings for you. “We believe AI will free people from low-value work, like taking notes,” says Smith in a room full of journalists hastily typing down his words.

Host Louise Newbury-Smith (Head of UK and Ireland) speaks of a ‘digital overload’ that Zoom wants to combat. “People nowadays need too many tools and platforms to do their work. Finding the right information takes a lot of time. That’s no longer human”.

Rafferty is asked whether it becomes so much more ‘human’ if everyone sends an AI agent to meetings instead of their cat, especially when they start to resemble us or even get our voice. “We want to maintain the balance between digital and human. That’s why we’re always transparent about when AI functions are enabled, so users still know when they’re talking to a human and when to an agent”.

Competing against Microsoft

Zoom is of course not the only company betting on AI agents. In this world, it will have to compete against the same rivals again. Even Rafferty can’t ignore big competitor Microsoft. “If the customer wants, we can replace Microsoft, but we have to be realistic. That’s why we see ourselves more as a complement rather than wanting to compete with them”.

Even during Zoom’s ‘heyday’, that was no easy feat. The integration into the 365 suite gave Teams an undeniable advantage over Zoom for companies that had subscribed to the total package. Microsoft can play that same trump card again with Copilot, and Google can also neatly integrate Gemini into the Workspace package.

Zoom prides itself on offering AI functions ‘at no extra cost’, but still has to convince companies to pay for a Zoom subscription in addition to their Microsoft or Google subscription. Head of Customer Success Bob Burke, who gets to participate in a panel as a birthday present, believes it’s possible. “Even organizations that already use Microsoft often still buy Zoom licenses for the C-level”.

Rafferty is more cautious in his statements, but sees an opening thanks to the unbundling of Teams enforced by Europe. “It’s positive that companies get the choice. You no longer have to use Teams: we can now offer integration at the same level. Nobody will be fired for buying Microsoft. Now we want to ensure that buying Zoom gets you a promotion”.

The cliché says that confirming is harder than breaking through, and for Zoom, that might well be the case. Zoom has managed to conquer the video meeting market, but will have to prove itself again as an ‘AI company’. Can the underdog surprise once more, or will Zoom end up as a one-hit wonder?

Nobody will be fired for buying Microsoft. We want to ensure that buying Zoom gets you a promotion.

Steve Rafferty; Head of EMEA & APAC Zoom