Following a massive second-quarter beat on both the top and bottom lines, shares of Zoom Video Communications Inc. (NASDAQ: ZM), which had added about 8.6% on Monday, traded up by around 30% in Tuesday’s premarket session. The stock posted a 52-week high of $325.90 on Monday and set a new high of $478.00 after Tuesday’s opening bell.
The company owes much of its success to the COVID-19 pandemic and the stay-at-home orders and lockdowns that forced businesses to close their offices temporarily while still trying to keep the business going. Zoom’s video conferencing software also became popular as a way for families to remain in touch during the lockdowns.
Why did Zoom float (or soar) to the top? There are at least two dozen similar applications available, some from the biggest companies in the technology world. One often-cited reason is that Zoom is easy to use. Another is that the software is free for an individual account that allows up to 100 participants to meet for a period of not more than 40 minutes.
Want to go above those numbers, then you have to pay. Typically, payment is based on the number of people in an organization who may host a meeting. The larger the number, the higher the per-host cost.
Here’s a look at seven Zoom competitors, along with basic pricing and plan information. Comments on competitors come from G2.
Webex Meetings from Cisco Systems Inc. (NASDAQ: CSCO) has a free tier that offers up to 50 minutes of meeting time for up to 100 participants. Under the company’s Plus plan, for example, up to 50 hosts cost $17.95 per month per host, or nearly $900. Some users have commented that the software is difficult to use and can be confusing, while others have had no problems. It appears that levels of technical expertise matter in larger companies.
Teams from Microsoft Corp. (NASDAQ: MSFT) debuted as an alternative to Slack. The meeting software is free for subscribers to Microsoft Office 365 and, in response to the coronavirus outbreak, Microsoft began offering a free six-month trial. There is no time limit on video calls, nor is there a limit on the number of participants. Paid subscriptions begin at $5 a month per user (requires annual commitment) and include additional storage space and other advanced options.
Alphabet Inc.’s (NASDAQ: GOOGL) entry is Google Meet, a renamed version of Google Hangouts Meet. Until September 30, meetings of up to 24 hours are free (then one hour) and meeting participants are limited to 100. There is no limit to the number of meetings. Subscribers to G Suite pay $10 per user-host beginning October 1 for meetings of up to 300 hours and 150 participants. G Suite Enterprise subscribers pay $20 per month per user-host for meetings of up to 250 participants.
Facebook Inc.’s (NASDAQ: FB) Workplace is basically the Facebook app for organizations. It includes a trial period, and there is a free tier that supports up to 50 team and project groups. Two paid tiers, one for $4 per user per month and the other at $8 per month, offer more storage and other advanced features. Workplace is priced well below other programs.
Verizon Communications Inc. (NYSE: VZ) recently acquired BlueJeans Network, which bills itself as a secure video conferencing platform. Unlike the other programs, BlueJeans does not offer a free tier. The Standard package costs $9.99 a month, which allows meetings of unlimited length for up to 50 people. The Pro package costs $13.99 a month for meetings of up to 75 people and the company offers tailored enterprise-level plans.
Adobe Connect from Adobe Systems Inc. (NASDAQ: ADBE) offers a free video meeting for up to three participants and two paid tiers at $50 or $130 a month for up to four hosts and additional participants. Connect gets good marks for its online learning capabilities.
GoToMeeting, which is owned by LogMeIn Inc. (NASDAQ: LOGM), offers a 14-day free trial of its services and two paid tiers costing $12 or $16 a month per organizer/host. The lower-priced tier allows meetings of up to 150 participants and the higher-priced tier lifts the limit to 250. Custom plans for meetings of up to 3,000 participants are also available.
Will any of these be able to unseat Zoom? Is there a long-shot contender? Zoom did not rise above its post-IPO high until mid-February of this year. The shares jumped more than 200% in just six months. Over the same period, the second-best performing stock was Facebook, which added about 35%.
If, as some observers claim, working from home is going to continue once the pandemic is brought under control, will Zoom be able to keep its lead as its competitors offer competing features for (perhaps) lower prices?
After Monday afternoon’s earnings report, Zoom stock traded up about 42% Tuesday morning at $461.40 a share. The consensus 12-month price target on the stock is just $249.49.