Zoom will stop selling directly to Chinese customers

The video-conferencing platform has announced that customers in mainland China will have to rely on third-party partners instead.
Written by Daphne Leprince-Ringuet, Contributor

Video-conferencing platform Zoom has announced that it will be halting direct sales to customers in mainland China in just a few weeks. Instead, China-based customers who wish to continue using the company's services will have to do so through local third-party partners.

Although users based in China won't be able to buy products directly from Zoom from 23 August, the company recommended several authorized partners in the country that offer services using Zoom's technology. It was reported that these include Bizconf Communications, Suirui Zhumu Video Conference and Systec Umeet.

A Zoom spokesperson said: "Our go-to market model in mainland China has included direct sales, online subscription, and sales through partners. We are now shifting to a partner-only model with Zoom technology embedded in partner offerings, which will provide better local support to users in mainland China."

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Users in Mainland China may continue to join Zoom meetings as participants, added the spokesperson.

The video-conferencing platform had already started distancing itself from its Chinese user base last May, when it limited new user registrations in the country to enterprise customers only. Existing free users continued to be able to join meetings, but were not allowed to host meetings themselves.

Zoom was founded in the US, but the company's ties to China have come under intense scrutiny. 

In June, US senators Josh Hawley and Richard Blumenthal stressed in a letter about Zoom and TikTok that although Zoom is headquartered in the US, it appears that the application is developed by at least three companies in China, including 700 employees in the country that work in research and development. 

"We believe that it is imperative that the Department of Justice investigate and determine whether Zoom and TikTok's business relationships, data handling practices, and operational connections to China pose a risk to Americans," said the senators.

The letter followed reports that Zoom had mistakenly served up encryption keys from servers in China to participants outside of the country. Citizen Lab, the Canadian laboratory behind the findings, highlighted that the company may be legally forced to disclose those keys to authorities in China.

Zoom's CEO Eric Yuan admitted that the slip might have happened when the platform rapidly added capacity to its Chinese region to handle the massive increase in demand caused by the COVID-19 pandemic. Yuan stressed, however, that non-Chinese data was only routed to China "under extremely limited circumstances".

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At the same time, Zoom came under fire for suspending the account of a pro-democracy dissident in China at the request of the Chinese government. This raised concern that the platform might support censorship in the country.

Although the account was eventually restored, the company conceded that it needed to come up with better rules to comply with requests from local authorities.

"Going forward Zoom will not allow requests from the Chinese government to impact anyone outside of mainland China," it said.

The latest decision to stop direct sales to mainland China, therefore, seems to fit well with the company's increased efforts to weaken its links with the country.

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