First or Stickiest: Remember The Diamond Rio?
When I meet with clients to talk shop – usually somewhere between an echoey conference room and a hotel ballroom with terrible coffee – I often bring up the Diamond Rio. Remember that? No? Exactly my point.
The Diamond Rio was the first digital MP3 player to hit the market, way back in the late ’90s. It could store and play music from an internal digital drive – years before Apple dropped the iPod and made digital music mainstream. But despite its early lead, the Diamond Rio faded into obscurity. Why? Because being first isn’t the same as being the best – or the stickiest.
Let’s fast forward to this summer’s Amazon Prime Day. Amazon, trying to wring every last dollar out of its made-up shopping holiday, doubled the length of its sale. And what happened? Consumers had more time to comparison shop – and Walmart ended up outpacing Amazon in several metrics: spending growth, site visits, transaction volume, etc. In other words, being first didn’t mean being best. Unless, of course, you were in the market for one of Amazon’s 14 different flavors of Echo or Ring devices.
Now let’s talk videoconferencing, which – until recently – Zoom was synonymous with. It was the hero we didn’t know we needed when the pandemic hit. Zoom didn’t invent videoconferencing, but it nailed the user experience in a way that made it accessible and almost fun. They had the democratized, freemium model, the dead-simple interface, and video quality that didn’t make you look like you were joining from a potato. They were in the right place at the right (terrible) time, and their stock rocketed to the moon. (One of the good launches – think Apollo 11, not SpaceX kaboom.)
Then, as the pandemic ebbed and the world slouched back toward normalcy, Zoom’s valuation came back to earth. That’s not a surprise – markets course-correct. But here’s what is surprising: Instead of doubling down on their core differentiator (excellent video), Zoom pivoted – hard – into artificial intelligence.
AI is the new hotness. Every tech firm from Meta to your cousin’s basement startup is tossing “AI-powered” into their pitch decks like confetti at a New Year’s party. And Zoom has made it very clear that it wants to be seen not as a video company, but as an AI platform. It’s poured energy into smart summaries, meeting recaps, agents, and productivity assistants. Impressive? Sure. But it comes at a cost. Instead of being one of only about a dozen platforms offering collaboration tools (and arguably the leader), Zoom is suddenly one of thousands of companies offering AI. (Millions of companies? Even more?)
To be clear: no one faults Zoom for prioritizing AI. They’re expected to. AI is no longer optional – it’s table stakes. But the question is whether those priorities have come at the expense of their core experience – video.
While Zoom has been busy chasing the AI dragon, business analysts have noticed something else: Zoom isn’t growing its collaboration user base the way it once did. Market share is slipping. Google Meet is gaining ground. Microsoft Teams – already bundled with Office/Microsoft 365 – is becoming the default for many organizations, even if the video quality sometimes feels like a low-res rerun of Knight Rider.
Let me be blunt. I use all videoconferencing platforms, including Zoom. I admire Zoom’s crisp, high-quality video and simplicity. It typically works better than the alternatives. But I’m in the minority. Most users don’t seem to care if the video is a bit fuzzier or if the layout is a bit clunkier – if Teams is already baked into their workflow, they’ll apparently take the convenience over quality every time.
Zoom, for its part, isn’t making it easy on itself to stay competitive in video. Yes, its AI capabilities are very strong – arguably much more cohesive than Microsoft’s ever-shifting Copilot army. (Seriously, Microsoft has more Copilots than the Fast & Furious franchise has sequels, and rolls out more changes than a Taylor Swift breakup album.) But slick AI features won’t save your dwindling collaboration market share if you’re no longer the clear go-to tool for video meetings.
And that’s where the real issue lies. If Zoom is innovating in video, the signal is lost in the AI noise. The narrative has shifted. It sure feels like video’s being neglected if not ignored. If you read their blogs closely, you may find a few meaningful updates. But most people don’t. And that’s a messaging failure.
No one is debating that AI isn’t important. Zoom’s problem is that it stopped tending the garden where it first bloomed. By putting all its eggs in the AI basket and relegating the minuscule collaboration news to the bottom of obscure blogs, it has left the door wide open for competitors to chip away at its video collaboration crown. And in tech, when you lose your edge, it’s hard to claw it back. Just ask BlackBerry. Or PalmPilot. Or, yes, the Diamond Rio.
It’s not that the competition is out-innovating Zoom in video. They’re not. However, if they’re winning by default – through bundling, perception, or inertia – then the blame lies with Zoom’s strategy and storytelling.
Don’t let anyone tell you there is no innovation left in a videoconferencing space that is “mature.” Recognize that for the cop-out that it is. If everyone were having perfect video calls all the time, we’d be having a non-stop party. Talk to anyone using videoconferencing. People actually using video meetings day in and day out know that’s not nearly true.
How has AI made inter-platform / interoperable calls easier? How has AI improved the “you’re on mute” situation? How has AI – or any innovation for that matter – made the video experience better than it was last year – so much better that I’d shun my embedded client and use Zoom instead, or only install my company’s videoconferencing rooms with Zoom? Mature? Give me a break.
So here’s the million-dollar question: Is Zoom building for the future, or wandering away from what made it successful in the first place…or both? Time will tell. But if the collaboration landscape keeps evolving the way it has been, we might look back a decade from now and remember Zoom not as a verb anymore, but as a trivia answer – right next to the digital music player that time forgot.
Let’s hope Zoom course-corrects before that happens. Because after decades in the video collaboration space, I can assure you that great video and great experiences still matter. And if Zoom doesn’t reclaim that narrative of truth soon, the other players will keep convincing the world that superior video and a simpler interface just aren’t worth the inconvenience of switching away from “good enough.”