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Zoom Phone takes center stage at Zoomtopia 2019

Zoom is increasingly positioning Zoom Phone as a core part of its portfolio and a service that every kind of business should consider.

SAN JOSE, Calif. -- Zoom is increasingly positioning its nascent cloud calling service as a core part of its portfolio, teeing up the company to clash with partner RingCentral and other leading unified communications providers.

Initially positioned as a lightweight add-on to its video platform, Zoom Phone has quickly evolved into a robust cloud PBX that Zoom hopes every customer will adopt.

The markets for voice and video calling will eventually merge, Zoom CEO Eric Yuan predicted in a keynote address at Zoomtopia 2019, the company's annual user conference.

"If any of you are still using other phone systems -- no matter the first generation, second generation or third generation -- today is the day to start thinking about the Zoom Phone system," Yuan said.

Zoom has had success selling its calling service to companies like Ciena, a telecommunications equipment manufacturer with more than 6,000 employees worldwide. The company decided to invest in Zoom Phone in large part because its users were placing fewer phone calls than ever before.

When its contract with Avaya for an on-premises PBX came up for renewal, Ciena opted to incorporate calling into an app its users already liked and knew how to use, Craig Williams, Ciena's chief information officer, said.

"We had to renew our contract with our voice systems, but no one used voice anymore," Williams said. "When I got here three years ago, we were a voice-only company. And then that changed with video, and now we're a video-first company."

Expansion of Zoom Phone complicates partnerships

In May, Zoom and RingCentral announced a "multi-year" extension of a partnership to package Zoom's video service with RingCentral's cloud calling service, an offering branded as RingCentral Meetings.

In a briefing with reporters and analysts, Yuan said he expected the partnership would continue because "the market is huge." But industry observers suspect Zoom's push into calling will compel RingCentral to find another way to support video conferencing for customers.

Another unanswered question is whether Zoom's foray into calling will affect its relationship with Slack, with whom Zoom entered into a formal partnership to align roadmaps earlier this year.

Zoom has been quietly building out its messaging service, Zoom Chat, in conjunction with its expansion of Zoom Phone. At the conference, Zoom announced it was giving users the ability to comment on messages (creating sub-threads within a group chat) and to react to messages with emojis.

Some companies value having a messaging app that tightly integrates with their meetings and calling services, an offering already supported by Zoom rival Cisco through its Webex platform.

"The more we focus on voice, we need chat," Yuan said. "As we sell more and more phone systems, I think chat will be key for us as well."

But, Yuan said, Zoom doesn't want to compete with Slack, which he described as more of a hub for integrations than a messaging app.

Zoom Phone adds partners, features

Since launching Zoom Phone in early 2019, Zoom has added more than 200 features and certified over 50 phone models for the service, the company said.

This week, the company expanded the offering to Ireland, New Zealand and Puerto Rico and launched a beta version in 11 additional countries. The service is now generally available in six countries, including the United States, Canada, the United Kingdom and Australia.

In those six countries, Zoom acts as a service provider, facilitating access to the Public Switched Telephone Network (PSTN). In locations where it lacks service, Zoom has a program that lets customers connect third-party calling services and infrastructure to Zoom Phone.

Zoom expanded that program this week through partnerships with the service providers NTT and Voxbone. Cloud integration with those providers will let Zoom Phone users connect to the PSTN without the need for an on-premises gateway, or session border controller.

Zoom Phone now has rudimentary integrations with contact center vendors Genesys, Nice inContact and Talkdesk, in addition to previously announced partnerships with Five9 and Twilio. Those integrations provide a SIP connection for transferring calls internally.

Additional Zoom Phone features announced this week include location-based routing, global dial plans and support for Citrix Virtual Desktop Infrastructure.

Zoom Phone still doesn't have as many features as the offerings of calling-focused vendors like RingCentral and 8x8. But the capabilities they lack are generally advanced functions that only a small number of users require, analysts said.

"For Zoom, it's a very important add-on," said Zeus Kerravala, founder of ZK Research. "They certainly don't have all the features, but I'm not sure most companies need them."

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