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Company of the Year: Aparna Bawa, Zoom COO

Zoom COO Aparna Bawa joins Yahoo Finance's Dan Howley to discuss the company's success in 2020.

Video Transcript

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DAN HOWLEY: Hi. We're here with Aparna Bawa. She is the CEO of Zoom. And we just want to talk about some of the security aspects of Zoom and how it's been able to scale from a company dealing with specifically B2B applications to everything from birthdays, weddings, carnivals, comedy shows, anything you can think of that now takes place on Zoom.

So what was the strategy to building up Zoom, you know, from its capabilities? And when you saw that initial burst of users as a result of the pandemic and more people going online, more people working from home, schooling from home, telemedicine, how did Zoom manage to scale up to deal with that huge influx?

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APARNA BAWA: That's a great question. You know, Zoom has always been from the beginning a service that was enabled to provide people with human connection. So our whole premise of our product was to provide human connection.

Now in December 2019 I would have said that that was largely focused around workplace collaboration. As you said, with the pandemic around the March time frame, we saw a huge influx of users. So we went beyond sort of the workplace-collaboration focus and we saw an increasing uptick of consumer use cases and consumer adoption, large meeting formats, et cetera. It was significant.

I mean, I would have loved to say that we planned it perfectly. Obviously we didn't. Nobody has planned this pandemic. And I think the biggest benefit for Zoom that you're seeing in the user base is that we do provide that human connection when we desperately need it most.

You know, for us at Zoom, it was a no-brainer. I remember when we first made the decision to turn on free service for schools, for example. Education is a very critical initiative for Zoom. It's a dear to your heart value for our employees. It's actually one of the things that we focus on as part of our Zoom foundation, which is our philanthropic arm, and it was voted on by our employees as the number-one issue.

And it just so happened that this pandemic had dislocated so many kids who were going to school. And so even those types of decisions-- turning on K-through-12 schools for free across the globe and eventually the United States was a decision in response to a need for human connection, a need for some normalcy during a very difficult time.

So for us, focusing on the user and focusing on the needs of the user has always been paramount, and I think that has shown up. That core value, that core driver of the business has shown up in spades in whatever we've done during the pandemic, it's sort of a response to the needs for kids to continue their education, response to the need for additional efforts around security and privacy, et cetera. It is a fundamental factor of how we do business.

DAN HOWLEY: I guess when you went and saw that influx, from a technical standpoint, were there new server farms you had to bring online? Did you have to, you know, extend it out to third parties? Was it just Zoom's server capabilities, or were you pushed beyond the bounds of that and then had to rely on Microsoft or Amazon, the public cloud kind of, so to speak? How did that work?

APARNA BAWA: Right. That's a great question too. So at its core, I think you have to understand how Zoom is built. So Zoom is built in a very simplistic way from the ground up with two things in mind. Number one, to deliver the most outstanding video possible-- video experience to the user. So that's why I can see your eyes and the deep blue of your eyes right now and you can see me is the outstanding video. And the second thing, we have built this architecture such that it scales in a way that's very easy to manage and it can meet that influx of demand.

So let me go a little bit deeper. So we have a distributed cloud-native architecture. It's comprised of about 19 different data centers all across the globe, and we use that in conjunction with the public cloud infrastructure, AWS and OCI. And that gives us significant control and flexibility when it comes to, you know, delivering audio and video and routing our traffic throughout the world.

And so when we have this unprecedented massive influx of demand, we have the ability to, in a few hours, deploy tens of thousands of servers all across the world depending on where we see the demand. And so it is that infrastructure, that outstanding video quality, coupled with a scalability that allows us to react very quickly and in a very flexible way that has made us, you know, react to the demand that we see from our users.

DAN HOWLEY: So it's something where, you know, you guys originally had the kind of backhaul available, and then--

APARNA BAWA: Yes.

DAN HOWLEY: --you know, to a degree. And then you said, OK, we're seeing this huge amount of folks coming in. We're going to, you know, flip on here, flip on there, OCI, AWS. We're going to need to kind of, you know, get all of our ability to get more and more people online. I guess was there ever a point where--

APARNA BAWA: I would say that our core--

DAN HOWLEY: --you guys were--

APARNA BAWA: Oh, sorry. I want to just confirm what you had said. Our 19 colocated data centers are the underpinning, and then we're able to flex. You know, we might even-- we started off the year I think with less colocated data centers, and we were able to add a few. I believe Singapore was one. We added a second one in Japan, et cetera. It's that kind of flexibility in conjunction with the public cloud infrastructure that makes us very flexible.

I would say, you know, I'm still amazed at our engineers and our technology team because the way they thought about this product, it is very scalable. And, you know, at a base case, we are not utilizing the full capacity that we need. We're always-- we always have some flex, and I think that proved itself out in the pandemic where we were able to thrust that flex and really see what it can deliver.

DAN HOWLEY: Was it something where, you know, you had seen the numbers starting to go up and thought, wow. This is getting, you know, intense where, you know, we have these capabilities but we're really, you know, starting to see them put to use and stressed as kind of never before. Was that something that you guys saw and were thinking, wow, it's a good thing we had prepared for something?

APARNA BAWA: You know, I would say we would love to be prepared for every eventuality. But, you know, I don't think anybody-- as I said, anybody saw the pandemic coming. It is a testament to the scalable nature of our technology that, you know, we were able to respond as I mentioned and flex up, within a few hours, tens of thousands of servers at a time.

For me, personally, you know, we exited December 2019. If you had asked me, I would have said we were squarely a workplace-collaboration service. We had about 10 million daily meeting participants, you know, in the December 2019 frame. By the time we turned around to April, it was more like 300 million daily meeting participants.

I have to say, you know-- I joke. I think I have ulcers from that time period, to be honest, just responding to the demand. It's very humbling. It's an honor and privilege to serve the world, and I am so proud of what Zoom has been able to do.

For me personally, the point at which I knew this thing was real and had hit was when I started to get calls from my kids' school parents saying, oh, Aparna, we finally figured out what you do now, you know, where everybody's on Zoom and I'm going to have, you know, my grandmother's birthday on Zoom. You know, I joined my cousin's wedding on Zoom. I mean, sadly there were also funerals on Zoom.

And so that's when I realized when we hit the K through 12, you know, free offer in the US, when we provided K-through-12 services for free, I think the recognition of Zoom's capability beyond workplace collaboration really sunk in for the world, basically, and also for all of us.

DAN HOWLEY: When you look at the security aspects, you know, we talk about how at first there was the issue with Zoom bombing and the default features weren't set, I guess, with classrooms in mind out of the gate, understandably considering that this was moved to classrooms kind of, you know, out of necessity.

When you look back on that, was it a time of, you know, I guess strife? Was it something that allowed you guys to learn more about the experience? What kind of takeaways did you have from that? And I guess where do you see the security and privacy aspect of Zoom now?

APARNA BAWA: That's a great question. You know, for us, we look at all of these events as a learning opportunity, as an opportunity to be better, to be better for our users and our stakeholders. And I would say we had a couple of things going on in March that really sort of brought things to a head. Number one, as you mentioned, the influx of new users, new consumer use cases on Zoom that we weren't necessarily prepared for and, you know, more people having very large meetings that they publicly posted, you know, meeting numbers for online for good reason, because you couldn't meet in person.

And so these factors resulted in a whole host of things that happened. And yeah, we called the Zoom bombings affectionately meeting disruptions. You know, we don't want to call them Zoom bombings per se. It's a very negative sort of connotation, but these disruptions were horrible. And that's one part of what our initiatives have, you know, intended to address.

And I will say just an example of that is just recently in the last month or so we have launched two security features to prevent meeting disruptions themselves. Number one, we added a Suspend Participant button on, you know, the security-- in the panel at the bottom of the UI. And that gives you the ability to suspend the meeting temporarily. It shuts down your video and your audio, and you can then-- the host can then kick out the offensive user and continue the meeting. And that has been-- that's a tremendous option for people who are shocked in the moment, and it does give the user some control.

And number two, we also launched an at-risk meeting notifier where we contact a host if we see that their meeting has been publicly posted on the internet. This happens all too often. Sadly, it's a good use of Zoom to allow for, you know, distributed connection, but this feature allows them to understand that their meeting ID has been posted publicly, and it gives them the option-- encourages them to make their meeting private, which is really important.

But let me go back to our original response in March to the security and privacy questions that came up. Well, first of all, we established a 90-day period-- and it ended in July-- where we did a feature freeze for any feature that was unrelated to security and privacy. So we focused the entire company on security and privacy.

And what came as a result is we released a new client, 5.0, and it had-- it grouped all of our security features into one icon. If you're the host, you have a security icon at the bottom of, you know, your UI bar, and you're able to see all of the security settings that were in the product. They just weren't in one specific place that you could easily find. So we put that in there.

We also, for a majority of our users, put in default settings around waiting rooms and pass codes, which you said, you know, gave people that, you know, baseline security and privacy notion that they could go in and change, but it gave them, you know, a baseline of a mandatory passcode and waiting room.

We also acquired Keybase, which if you know Keybase, they had a tremendous capability around encryption. And we-- they basically helped us develop our end-to-end encryption feature, which we then launched in October of this year at our Zoom Tokyo user conference. That has been a tremendous, tremendous success.

End-to-end encryption, it allows the contents of the meeting and all the communications between the participants to be fully encrypted with the keys-- with cryptographic keys held at the client level, so with the individual participants themselves. So there's-- you know, it's a heightened level of encryption that is very tough to do at scale with video, and we've been able to do it, which is very exciting.

We also customized data-routing options for our paid customers by geography. We worked with lots of third-party experts, and, in fact, we created a CISO council with about 35 CISOs of leading companies across the industry-- across all industry, if you will-- to focus on how we can improve our products and our policies around security.

And finally, we've done some tremendous hiring, if I do say so myself. We've added some very solid industry veterans. You know, we hired a new CISO, Jason Lee, who came to us from Salesforce and previously Microsoft. We hired a new president of technology and product, Velchamy Sankarlingam, who came to us from VMware. We've hired-- you know, we made significant inroads in our vulnerability-management program when we hired one of the experts in that space in building those programs, Adam Ruddermann.

So I'm very proud of the job we've done to identify areas in which we can improve using our users' and our stakeholder's help and then quickly pivoting to take action on it and not being reticent or not sort of stopping to say do we know everything? but really finding experts who can help us and bringing them and incorporating them into the fold to deliver an outstanding service to our users.

DAN HOWLEY: I guess when you look at, you know, where Zoom originally started, right-- B2B-- to-- you know, you listed the-- you can go on ad, you know, infinitum with all the different use cases that Zoom is now being used for. When you look at that, what, I guess, has been kind of the biggest challenge in ensuring that you're able to have people having important office meetings? I know the Fed had a meeting on Zoom. You know, UK government has meetings on Zoom. Where do you see, you know, then going to birthday parties? What's been kind of the challenge for Zoom in that respect? It's two different types of uses, right?

APARNA BAWA: You have hit the nail on the head, Daniel, because I don't know how many technology companies have been able to successfully address, you know, both the enterprise space and the consumer space from the same platform.

And I will say, you know, the struggle-- when we started to realize that the consumers were using our platform en masse, . We took a step back and thought through how have we been built? And if you take a step back and think about us as a workplace-collaboration solution, we really built this platform to be extremely flexible.

So our business customers take our platform, and then they customize it to what they want. Now, it doesn't have to be a very difficult customization. It's very easy to customize it, but they can pick and choose what they want.

So we have enterprises that say, I don't want your waiting rooms. I'll take your passcodes, but, you know, I want an authenticated user experience only so I'll only let authenticated, you know, users from my company with a domain name join your meetings. And so they can sort of configure the Zoom experience for them and what they prioritize.

You know, we're used to selling in the enterprise to IT departments and to CIOs. And then when you have a consumer use case where it's a teacher who says my kid or my student is not able to get into my class because he's late-- he or she is late and I've already started, and now I have to remember to go check the participant list to see if someone's waiting in the wait room, you know, five minutes later, I'm just going to turn off the waiting-room feature.

You understand why that feature is doing this. You can see how it impedes sort of classroom productivity for the teacher to stop teaching and check, you know, whether a kid is late. And so being able to address both of those needs at the same time where you have enterprises who are telling us, you know what? Please don't make these mandatory. Please don't make them, you know, default. Let me-- you know, we love Zoom because of the easy-to-use nature. Please keep it that way and give us the flexibility. Versus consumers who shouldn't have to think about this. They should just get on Zoom, have their great experience, and get off of it, and, you know, that's that and then feel really good that they participated with other people that they have that human connection.

And so we-- we had-- so what we have done is really tried to educate as much as possible, really tried to think of each different customer base and their own unique needs, tailor our services and our features and the default settings to address each sort of user bases' individual, unique needs.

It is challenging, I have to say. Decision making at Zoom is very fun and interesting. You know, we think about all of our stakeholders. And it's-- you know, to be honest, it can be very challenging. It's also extremely rewarding when you think about all the benefit that we're providing consumers. And I personally feel very privileged, very honored, and very humbled to provide that service.