Leo Sun Zoom Video Communications (NASDAQ:ZM) stock price fell 8. Zoom seems to have penetrated a significant portion of the addressable. The video conferencing company faces a painful slowdown. Much of its growth has been pulled forward by the pandemic. In Windows 10, which more than 1 billion devices use every month, the company even added a Meet Now button so people can easily access the company's Skype videoconferencing capabilities. Zoom is investing in a lot of new products like Zoom Phone. For example, Microsoft's ( MSFT -1.94%) Team software makes collaboration and group chat easy and now enables quick videoconferencing as well. Many tech companies have since enhanced their videoconferencing capabilities.
However, those aren't advantages that can hold up for long at all. Videoconferencing is not a new phenomenon by any stretch, but Zoom did make it popular and easier to use - people just have to click a link to join a virtual meeting. While Zoom's sales were soaring over the past couple of years, it didn't make sense to me that so many businesses were buying its services when they likely already had videoconferencing capabilities of their own. What happened Bellwether teleconferencing stock Zoom Video Communications ( ZM -0.95) was a stinker of a stock on Friday.
Zoom is a great example of a business without much moat. Investors were spooked about outages of the company's phone service. A moat is a defensible competitive advantage that allows a business to perform well and keep its investors from taking away too much market share.
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