Some newer board readers here might wonder why many of us are so sanguine about Zoom in the face of competition from Facebook and Google.
In a post way back in 2018, I highlighted a quote from a podcast about competition. The speaker said:
Is there any high growth start up…that hit escape velocity, that a large competitor has ever, basically beat?
Perhaps he wasn’t entirely correct. You might be able to find one or two if you look back 25 or 50 years. But I like those odds.
A few months ago I posted about AYX competition, and I think my conclusion could also be applied to Zoom:
The main thing is that customers want a solution everybody can use. The more it can be compatible with other things a subset of employees want to use, the better.
Neither ZM, nor AYX, nor ROKU, nor any of our companies are doing things that no other company can possibly do. But their customers love the way they’re doing it, and that attracts other customers. And that’s enough. We don’t even need to know all the reasons why their customers love them. We can follow the numbers.
Lastly, don’t assume best price leads to adoption. Brand names cost more than generics even for consumer products. For organizations, let’s say a large accounting firm has to pay Zoom $100 or $200 or even $1,000 each year for each of its employees to have Zoom and Zoom rooms and everything they need…but this firm pays those employees 50k or 75k or 100k or 150k or 500k each year…well, the Zoom expense is relatively negligible, no?
The price isn’t always right even when the price is “free.” Companies pay for things (Slack, Zoom, etc) that they may already have included in Microsoft Teams – WHEN it’s worth it to them! That is already happening, and has been for some time.
People often make competition out to be a lot scarier than it is. Competition is healthy capitalism. Don’t fear it so much.