Chinese users of Zoom are gradually migrating to a Chinese version of the video-conferencing service after the country blocked the global version last week.
Why it matters: Amid an intensifying battle over technology and trade between China and the US, Zoom has been added to a lengthy list of US internet service firms blocked in China. Blocking access to Zoom may improve growth opportunities for Chinese companies in the sector.
- The size of China’s video conferencing market surged 36.2% year on year to RMB 3.1 billion ($439 million) in 2018, according to data from research institute CCW Research.
- Chinese companies in the sector include Shenzhen-listed BizConf Telecom and XYlink, among others.
- Mainland Chinese users began complaining that Zoom was no longer available in the country on September 8.
- Although Zoom has said that international expansion is a major opportunity, its revenue from the rest of world only represented 20% of its earnings for the six months ended July 31, 2019.
“Zoom’s website, meetings, and webinars are currently inaccessible in China. Our investigation remains ongoing, but we have determined that the cause is an inability to connect to the local China DNS (domain name system).”
—Priscilla Barolo, Zoom communications manager to TechNode
Details: Zoom users in the country are moving to the localized version, run by partner Huawan Telecom.
- Local media reported that Huawan received a heads-up before the block, and required employees to switch to the local version to ensure normal workplace communication.
- Intensifying international tensions and the country’s upcoming 70th anniversary are cited as reasons for the block, according to Chinese media.
- Other third-party apps using Zoom as a communication tool are also recommending that users switch to the local version to ensure a stable connection.
- An industry insider told Chinese media that failure to comply with local laws may have also contributed to the block. China requires communication tools for local enterprises to run services on domestic servers. The government could not locate Zoom’s server, according to the source.
Context: Founded in 2013, Huawan Telecom is a video-conferencing service provider based in Shanghai.