Zoom Gets More Popular Despite Worries About Links to China

Very few companies can boast of having their name also used as a verb. Zoom is one of them. The popularity of the videoconferencing platform continues to grow around the world despite continued questions about whether Chinese authorities are monitoring the calls.

Since Zoom became a household word last year during the pandemic, internet users including companies and government agencies have asked whether the app’s data centers and staff in China are passing call logs to Chinese authorities.

“Some of the more informed know about that, but the vast majority, they don’t know about that, or even if they do, they really don’t give much thought about it,” said Jack Nguyen, partner at the business advisory firm Mazars in Ho Chi Minh City.

He said in Vietnam, for example, many people resent China over territorial spats, but Vietnamese tend to Zoom as willingly as they sign on to rivals such as Microsoft Teams. They like Zoom’s free 40 minutes per call, said Nguyen.

Whether to use the Silicon Valley-headquartered Zoom, now as before, comes down to a user-by-user calculation of the service’s benefits versus the possibility that call logs are being viewed in China, analysts say. China hopes to identify and stop internet content that flouts Communist Party interests.

The 10-year-old listed company officially named Zoom Video Communications reported over $1 billion in revenue in the April-June quarter this year, up 54% over the same quarter of 2020 when the COVID-19 pandemic drove face-to-face meetings online. In the same quarter, the most recent one detailed by the company, Zoom had 504,900 customers of more than 10 employees, up about 36% year on year.

Zoom commanded a 42.8% U.S. market share, leading competitors, as of May 2020, the news website LearnBonds reported. Its U.S. share was up to 55% by March this year, according to ToolTester Network data.

Tech media cite Zoom’s free 40 minutes and capacity for up to 100 call participants as major reasons for its popularity.

Links to China?

Keys that Zoom uses to encrypt and decrypt meetings may be sent to servers in China, Wired Business Media’s website Security Week has reported. Some encryption keys were issued by servers in China, news website WCCF Tech said.

Zoom did not answer VOA’s requests this month for comment.

Zoom has acknowledged keeping at least one data center and a staff employee in China, where the communist government requires resident tech firms to provide user data on request. In September 2019, the Chinese government turned off Zoom in China, and in April last year Zoom said international calls were routed in error through a China-based data center.

“Odds are high” of China getting records of Zoom calls, said Jacob Helberg, a senior adviser at the Stanford University Center on Geopolitics and Technology.

“If you have Zoom engineers in China who have access to the actual servers, from an engineering standpoint those engineers can absolutely have access to content of potential communications in China,” he said.

Zoom said in a statement in early April 2020 that certain meetings held by its non-Chinese users might have been “allowed to connect to systems in China, where they should not have been able to connect,” SmarterAnalyst.com reported.

Excitement and caution

Zoom said in 2019 it had put in place “strict geo-fencing procedures around our mainland China data center.”

“No meeting content will ever be routed through our mainland China data center unless the meeting includes a participant from China,” it said in a blog post.

Among the bigger users of Zoom is the University of California, a 10-campus system that switched to online learning in early 2020. Zoom was selected following a request for proposals “years” before the pandemic, a UC-Berkeley spokesperson told VOA on Thursday.

Elsewhere in the United States, NASA has banned employees from using Zoom, and the Senate has urged its members to avoid it because of security concerns. The German Foreign Ministry and Australian Defense Force restrict use as well, while Taiwan barred Zoom for government business last year. China claims sovereignty over self-ruled Taiwan, which has caused decades of political hostility.

“For Taiwan, there’s still some doubt,” said Brady Wang, a Taipei analyst with the market intelligence firm Counterpoint Research, referring particularly to Zoom’s encryption software. “And in the final analysis, these kinds of choices are numerous, so it’s not like you must rely on Zoom.”

LinkedIn’s withdrawal from China announced this month may spark new scrutiny over Zoom, said Zennon Kapron, founder and director of Kapronasia, a Shanghai financial industry research firm.

“I think when you look at the other technology players that are currently in China or that have relations to China such as Zoom, there will be a renewed push probably by consumers, businesses and even regulators in some jurisdictions to really try to understand and pry apart what the roles of Chinese suppliers or development houses are in developing some of these platforms and the potential security risks that go with them,” Kapron said.
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