Oracle Corp. (Oracle), an American computer tech company, has won a cloud computing service deal with Zoom Video Communications Inc. (Zoom) due to a sharp increase in demand for video call conferencing amid the lockdown prompted by the coronavirus outbreak.
Zoom, a US-based tech firm providing video call and online chat services, said on Tuesday, April 28, 2020, that the cloud computing provider would help in supporting the online video call platform, which had a surge of a large volume of traffic recently.
Zoom’s Gaining Popularity
Zoom’s video call platform gained popularity since the demand for online chat or video conferencing increased significantly from those employees of corporations who were forced to work from home due to the lockdown caused by the virus pandemic. With providing platforms for video call chatting for the remote learning service, Zoom helped in stay connected with the billions of people including school students for their virtual classes.
Recently, it was reported that the number of users for Zoom has increased tremendously; it witnessed that the daily meeting participants soared from 10 million to 300 million in December.
Nonetheless, the video call platform has been facing strong criticisms due to poor systems to tackle the issues of exposing privacy and security flaws of the users. A source explained, Zoom set out a 90-day plan to fix the security issues, but in the meantime, it needed to handle the thirty-fold jump in traffic of its online chat service, which required more computing power.
The deal can be considered to be a big win for Oracle, which would allow the company to be more competitive against rivals such as Amazon.com (Amazon) and Microsoft Corp. (Microsoft) after its first generation efforts of new cloud technology failed to gain pull.
Oracle Emerging a Strong Player
The new deal with Zoom, Oracle is looking forwards to gain its leverage in the cloud service industry. Meanwhile, Zoom and Oracle, without giving many details, said the cloud service that handles traffic for “millions” participants of video call meetings would support about 7 million gigabytes of Zoom data per day.
Jean Atelsek, an analyst with 451 Research, believes that if the deal proves successful then it would promote Oracle a high-profile customer service provider and strengthen its new technology to compete with larger rivals. Atelesk said, “What’s remarkable about this deal is just the velocity with which it happened.”
Zoom’s Chief Technology Officer, Brendan Ittelson told Reuters in an interview, “It’s exciting to be able to come on to a platform and scale very rapidly.” Currently, Zoom runs its services with the help from other cloud computing services from Amazon Web Services and Microsoft’s Azure, but it also began working with Oracle about six weeks ago.
Following the deal, Zoom and Oracle executives would combine their engineering teams and work together on a daily basis to handle a significant portion of Zoom’s traffic.
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