There will be a number of SaaS service providers in China, whether they are veteran video conferencing SaaS vendors or new startup SaaS vendors.
Editor’s note: This article is from WeChat public account “Niutoshe” (ID: Neuuters), author Cui Qiang.
On January 13, 2010, when Google left China, the situation was still vivid. On the second day after Google announced its withdrawal from China, the CRM held a huge conference. “Google is gone, there are still hundreds. meeting”. Baihui’s use of the spread of the situation, because its brand is too small, only in the industry, there is no wave of influence, and did not bring a particularly large impact.
On September 9, 2019, Zoom, the largest video SaaS service provider in the United States, could not be accessed. The news came out that the major video conferencing providers in China were no longer calm. With the withdrawal of Zoom, domestic video conferencing SaaS service providers will also see growth. However, it is worth noting that several listed companies with video conferencing products and concepts have not strengthened, but have continued to fall.
There will be no interpretation of Zoom’s past and present, because the Chinese entrepreneur Yuan Zheng’s Zoom has long been a star enterprise in the SaaS circle at home and abroad. The Zoom, which was established in 2011, was successfully launched in April 2019.
The closure of China will not have a fatal impact on the Zoom business, as its operations are spread across 180 countries and regions, with US revenues accounting for more than 82%. Foreign cloud computing operators need to hold business licenses for telecom operations in China, which is the main reason why Zoom cannot be accessed.
Zoom’s exit will inevitably leave a huge market space for domestic video conferencing SaaS vendors.
1. Domestic video conferencing systems have solutions from high to low, but the market penetration rate is extremely low. According to some surveys, the market penetration rate is between 2% and 4%, and it is concentrated in the government and medium and large enterprise markets. The SME market is not well covered. In the future, SMEs will also become important markets for SaaS video conferencing vendors;
2. Zoom The minimal application experience has affected some Chinese business users. As Zoom stops operating in China, Chinese corporate customers are bound to find alternatives, and users will have difficulty returning to the state of using complex products.
3. A number of SaaS service providers targeting Zoom will appear in China, whether they are veteran video conferencing SaaS vendors or new startup SaaS vendors;
4. Cloud-originated SaaS vendors will gain a late-comer advantage. Will they rise rapidly without the original technology burden?
5. The high-end market has strong paying power, but the scalability is poor; the SME market has a poor willingness to pay, but the space is large enough, and how to make a choice will become a problem;
6. How to quickly create the network effect of the product will be a problem that many video conference SaaS needs to solve, and some will skyrocket and no return to the traditional;
7. Video Conferencing SaaS products inevitably break the predicament of high prices, complex products and high maintenance and operating costs.
First movers
Several video conferencing vendors currently active in the domestic market: Huichang Communications, which is listed separately, Haoshitong, which was acquired by Qixin Group, Zhanshi Interactive (now 263 meeting) acquired by 263 Group, full time, with Sharp Technology, the rising star Xiaoyan Yilian, Weiwei, get the scene video (former CC video), witness live broadcast and the blue cat micro-conference that just announced the successful financing last week. If you add a future office solution, Cisco, Polycom, Huawei, the video conferencing market has been crowded from high to low.
On January 23, 2015, 263 acquired 100% of the exhibition through its wholly-owned subsidiary 263 Communications. Prior to this, 263 subscribed for 30 interactive exhibitions in September 2013 and December 2014. The equity of % also laid the foundation for the 2015 acquisition.
Before the acquisition, Zhanshi Interactive has more than 1,000 large and medium-sized enterprises and well-known education and training institutions, occupying the leading position in China’s interactive live broadcast market, becoming IBM, Huawei, Lenovo, Jingdong, Alibaba, Morgan Huitong, New Oriental, Suntech , Guangzhou Automobile Honda, Bank of Communications, China Southern Power Grid, Tiens Group and many other well-known enterprises and institutions of choice partners.
The exhibition interactively cut into the market with large-scale conference live broadcasts. In the absence of market funds, they cooperated with major head media to exchange resources to help the media to broadcast the large-scale summit, which opened up the brand’s popularity in a short time. They made full use of the characteristics of video live delay, changed the live broadcast to delayed live broadcast, and solved the problem of video live broadcast and delay.
On March 24, 2016, Qixin Group announced a 560 million acquisition of 100% equity of GoodVision. In 2016 and 2017, the proportion of GoodVision in the domestic online conference market was 13.1% and 13.9% respectively.
In addition to the original cloud computing cloud video business, Qixinhaoshitong began to deepen the application scenarios of smart party building and smart education, developed new intelligent hardware products, and launched a new generation integrated cloud conference terminal, MeetingPlus. After Zoom was closed, Hou Gang, the president of Haoshitong, sent 100 MeetingPlus an hour in the Cui Niu community.
In 2017, Huichang Communication successfully landed on the GEM of the Shenzhen Stock Exchange, thus opening a precedent for successful listing of domestic cloud video conferencing companies, stock code: 300578. Founded in 2006, Huichang Communication is good at head business. It is said that 70% of the world’s top 500 companies are long-term customers.
With the three-board listed company, Ruirui Technology, the company is mainly positioned to provide high-quality video communication cloud products for domestic and foreign government and enterprise markets. In July 2019, a round of fixed increase was just completed, raising 365 million yuan, mainly for cash flow replenishment.
These manufacturers, the listing of the listing, the acquisition of the acquisition, they borrowed the resources of the listed company, opened a new journey. In 2017, the industry was a bit of a preliminary pattern.
Challenger
Video conferencing has technical thresholds: video encoding, HD graphics, anti-dropping technology, echo cancellation, silence detection, and more. Most of the domestic startup teams are from the Cisco (WebEX), Polycom and YY teams, which are a bit like the Whampoa Military Academy in the video conferencing field.
The entrepreneurs who came out of these teams were also labeled as “mastering the core technology of video.” The founder of Zoom, also from Cisco, started his own entrepreneurial journey with more than 50 core R&D.
Yuan Wenhui of Xiaoyu Yilian was born in Polycom. The predecessor of Xiaoyu Yilian was a small fish at home. He was facing C-side entrepreneurship and products. Later, they found that many companies are also purchasing small fish products for video conferencing. Later, a small fish office product line was extended. In the early days of Xiaoyu’s office products, Cui Niu made the first launch of the product, and also made the first batch of seed customers in Xiaoyu Office.
The two core founders of Xiaoyu, one is Yuan Wenhui from Polycom, and one is Song Chenfeng from YY (Yicheng Blue Sky CEO, creating the first 3D virtual world platform, which was acquired by YY).
The genes are different because of their different origins. In the end, the small fish was split into two companies at home, one led by Yuan Wenhui to attack the enterprise market, and later renamed Xiaoyu Yilian, led by Tencent in the C round; one led by Song Chenfeng to attack the consumer market and continue the small fish home brand, The C+ round was led by Baidu and cooperated with hundreds of home products.
The core team founder CEO Deng Yuze and CTO Yan Degui also came from YY’s Blue Cat Micro Club, which was founded in 2019. This startup company, which originally wanted to open the market with low-key, was chased by many investment institutions because of the withdrawal of Zoom. After two months of establishment, it won two rounds of financing and had to go ahead in advance.
“Although the Chinese video conferencing market has developed for many years, it is mainly concentrated in the government, state-owned enterprises and large enterprise markets.