Zoom taps Oracle for cloud deal, passing over Amazon, Microsoft

Eric Yuan, founder and chief executive officer of Zoom Video Communications Inc., speaks during the BoxWorks 2019 Conference at the Moscone Center in San Francisco, California, U.S., on Thursday, Oct. 3, 2019.

Bloomberg

Zoom selected Oracle to provide its Cloud Infrastructure service on Tuesday, bypassing major cloud leaders Amazon Web Services, Alphabet’s Google Cloud Platform and Microsoft‘s Azure Cloud. The terms of the deal were not disclosed.

“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,” Zoom CEO Eric Yuan said in a press release. “We chose Oracle Cloud Infrastructure because of its industry-leading security, outstanding performance and unmatched level of support.”

Zoom already uses Amazon and Microsoft’s cloud services, but went with Oracle for its latest expansion. Oracle founder and chairman Larry Ellison praised Zoom earlier this month, calling it an “essential service” during the coronavirus pandemic.

The Covid-19 pandemic has pushed many companies and schools to remote work, which allowed Zoom to emerge as a key player. The videoconferencing software company last week surpassed 300 million daily users, up from 200 million in just weeks. 

Oracle said in a release that Zoom chose its service for Oracle’s “advantages in performance, scalability, reliability and superior cloud security.” It’s a surprising move from Zoom, as it chose Oracle over its larger competitors. According to research firm Canalys, Amazon had the largest cloud market share at the end of 2019 with 32.4%, followed by Microsoft (17.6%) and Google (6%).

Oracle stock was little changed following the announcement.

Zoom’s massive growth has also raised security questions around the service. After several security snafus, the company said it would focus on beefing up its security over the next few months instead of rolling out new features it had planned.

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