Zoom Video (ZM) Updates Policy to Address Data Concerns Over AI
Zoom Video ZM recently addressed concerns over its policy regarding the use of customer calls to train artificial intelligence (AI) models. The company has updated its Terms of Service referencing its generative AI tools. The company has explicitly stated that communications-like customer data will not be used to train AI models for Zoom or third parties.
The initial update to Zoom’s Terms of Service suggested that customer data could be used for AI purposes without obtaining explicit consent. This led to backlash as users felt their information was being exploited without their knowledge or choice, particularly for individuals who had no alternative but to use Zoom for work.
In response to the criticism, Zoom promptly revised its rules to address the concerns. The company stated that it would not utilize any customer audio, video, chat or content to train its own or any other company’s AI models. Specifically, section 10 of Zoom’s updated Terms of Service was modified to eliminate user concerns.
ZM emphasized that meeting administrators can opt out of sharing meeting summaries data with Zoom. Non-administrator meeting members are notified about Zoom’s new data-sharing policies and given the option to accept or leave meetings.
These measures demonstrate ZM’s commitment to addressing user concerns and safeguarding privacy. Zoom aims to instill trust and ensure a sense of security among its users by being transparent about how user data is handled.
Considering the widespread reliance on video calls for staying connected, Zoom’s responsiveness in rectifying mistakes and prioritizing privacy is highly significant. It serves as a reminder for individuals to be aware of how their information is being utilized and to voice concerns whenever they arise.
Zoom Video Communications, Inc. Price and Consensus
Zoom Video Communications, Inc. price-consensus-chart | Zoom Video Communications, Inc. Quote
Zoom’s Recent AI Initiatives to Aid User Engagement
Joining the growing list of companies that offer generative AI tools, Zoom is strategically leveraging AI to increase its user base and enhance user engagement. By harnessing the power of AI, the company aims to attract more users to its platform and enhance the overall experience for its existing users.
In June, Zoom introduced significant elements of Zoom IQ, an intelligent assistant that enhances collaboration and unleashes individuals' capabilities using generative AI. These features, such as Zoom Meeting summary and Zoom Team Chat compose, are now accessible through complimentary trial periods for eligible customers. By leveraging these tools, teams can enhance productivity, balance workday priorities and collaborate more effectively.
The company also unveiled the release of the Intelligent Director for Zoom Rooms. This cutting-edge technology utilizes AI and multiple cameras to provide optimal visibility and angle of in-room participants during hybrid meetings.
Intelligent Director is a specialized solution for medium to larger-sized rooms, addressing the issue known as the bowling alley effect. It can frame up to 16 participants individually using multiple cameras and ZM's AI, selecting the most suitable video stream to be displayed in the gallery view of the Zoom Meeting.
Such initiatives are expected to drive enterprise customer engagement, thereby boosting top-line growth in the near term. The Zacks Consensus Estimate for enterprise customers is pegged at 219, 032.
This Zacks Rank #3 (Hold) company expects total revenues between $1.110 billion and $1.115 billion in the second quarter of fiscal 2024. Non-GAAP earnings per share are expected between $1.04 and $1.06 with approximately 307 million weighted average shares outstanding. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for ZM’s second-quarter fiscal 2024 earnings is pegged at a profit of $1.05 per share. The Zacks Consensus Estimate for revenues is pegged at $1.11 billion, indicating year-over-year growth of 1.25%.
Zoom faces stiff competition in the cloud communications segment from players like RingCentral RNG, Microsoft MSFT and Alphabet GOOGL-owned Google Cloud. Zoom provides high-quality video and audio communications and has gained popularity during the pandemic, whereas Alphabet provides cloud communications service through Google Meet, which is integrated with Google Workspace.
Microsoft provides a unified communications as a service through Microsoft Teams and has a large user base across various industries.
RingCentral is riding on a strong product portfolio providing UCaaS and CCaaS solutions, including RingCentral MVP, RingCentral Video, customer service and support. The adoption of AI-powered cloud communications and business solutions has been strong recently.
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