Read the Zoom case study 11 at the end of chapter 11. Summarize the case study and discuss the impact of video conferencing on business and society.

Zoom WebEx offered one of the earliest business-oriented video conferencing applications. While WebEx was used for many types of business meetings, it was especially successful for video sales calls. Early editions of this textbook were sold to professors over WebEx. In 2009, Cisco Systems acquired WebEx, and Eric Yuan, who had led WebEx's development staff, left the company and in 2011, founded Zoom. At the time, industry pundits thought it unwise to enter a new product in a market crowded with products. Besides Cisco, Microsoft, Google, Apple, and others had popular products that consumed the bulk of the video conferencing market. 314 In spite of the doubters, Zoom enjoyed success and by its fiscal year 2018 earned $121.5 million in revenue, followed by $330.5 million in 2019 , and $622.7 million in 2020. The company had its initial public offering in April of 2019 and its share price rose from $36 pre-IPO to $146, with a market capitalization of Two of the principal reasons for Zoom's success were that its products were easy to use and Zoom provided an easy entry with a free download of its basic product. Revenue was earned on upgrades to commercial products. Zoom was therefore a successful company in 2019, but its growth became astronomical when the COVID-19 pandemic occurred in early 2020. In December 2019, Zoom had 19 million peak users, but by February 2020, Zoom's peak users rose to more than 200 million and by March 2020 rose to more than 300 million. In January 2020 there were 56,000 daily downloads of Zoom products. By March of that year there were 2.13 million daily downloads. 56 Much of this growth occurred when many universities, public schools, churches, book groups, and friends and families chose Zoom when stay-athome restrictions were implemented. To be sure, other vendors also had dramatic increases. For example, Microsoft Teams had 44 million users in March 2020 and 77 million in April 2020. 57 Teams, at that time, was a commercial-only product and consequently did not see the same growth for school and home use as Zoom did. Microsoft and see the same growth for school and home use as Zoomdid.Microsoftand Google and others were not asleep, however. By May 2020, after they observed Zoom's growth, both companies announced future products for personal and home use. 58 How Did Zoom Support That Growth? Before continuing, consider that Zoom's four-month growth from 19 million to 300+ million users meant it was more than doubling its users every month. Prior to cloud vendors and virtualization, such growth would have been impossible. Zoom would have had to double its own processing capabilities each month, meaning buy or lease thousands of computers, spaces to hold them, and obtain power and air conditioning to run them. They would have needed to install software, negotiate with vendors to at least double data transmission capability, and acquire and train staff to run the data centers. No company could accomplish such infrastructure growth. While Zoom did operate some of its own computing infrastructure, the lion's share of its workload was processed by Amazon Web Services (AWS). AWS is in the business of supporting large changes in customer demands (consider what AWS does for Amazon during the holiday season) and, because of virtualization, was able to support the monthly doubling of Zoom's processing needs without major problems. Cloud vendors like AWS provide three assets: computer processing, data storage, and data transmission. Considering video conferencing applications such as Zoom, the bulk of the workload is coordinating and publishing video streams among groups of people. That workload calls for a modest amount of processing power; adding and removing users from meetings and coordinating video displays among them does not place major computational demands. Similarly, data storage requirements are minimal. Much of the storage that is required is done on the users' computers. Clearly, however, sending video streams in real time from one participant to others requires immense amounts of data transmission. Enter Oracle Cloud From all we can tell from the outside, AWS supported Zoom's astronomical growth in processing needs quite well. Therefore, many were surprised when Zoom announced that it was entering into an agreement with Oracle to provide ZoomannouncedthatitwasenteringintoanagreementwithOracletoprovid cloud services. 59 Oracle is a strong company in the database and database applications market, but it is a relatively lesser player in the cloud market. In 2019, the top cloud companies were AWS, Microsoft Azure, Google Cloud, and IBM. Oracle Cloud was fifth. Corey Quinn, a self-described Cloud Economist for the Duckbill Group, provides one explanation. The Reuters article states that Zoom processes 7 million gigabytes of data per day. From that number, Quinn computes that (which Zoom likely does not pay; most likely they have negotiated some lowe cost based on their large volume), but using AWS standard costs, Zoom pays AWS \$11.1 million per month for data transmission. Using Oracle Cloud's standard price, Zoom would pay Oracle $1.8 million per month for data transmission. Quinn attributes the Oracle contract as a cost-saving move. At present, this announcement does not mean that Oracle will process all of moving the Zoom application from AWS servers to Oracle Cloud servers may or mav not be an expensive and riskv proiect. The difficulty depends on the or may not be an expensive and risky project. The difficulty depends on the architecture of Zoom's applications, which are unknown outside the company. Sustainable? In terms of number of users, Zoom is the undisputed market leader in video conferencing. But is that position sustainable? Growth from future stay-athome orders is, we can hope, a black swan. The question is whether Zoom will be able to maintain its growth under normal circumstances. Staring at a display of faces staring back at you is unnatural, and many find it tiring if not emotionally uncomfortable. 60 But if future business travel is curtailed, many business meetings will continue to be video conferenced, regardless. At home, however, social video conferencing may become rare as people decide that the phone works just fine and you don't have to comb your hair or get out of your bathrobe. Further, will Zoom be able to stand up to the competition? The switching costs for video conferencing are low, especially for personal use that is readily supported by fast application downloads. The barriers to entry of new video conferencing are high, but companies like Microsoft and Google have deep conferencing are high, but companies like Microsoft and Google have deep pockets. Because of the cloud, those costs are much less than they would have been in the past. What is the future for Zoom