Verizon is set to acquire teleconferencing provider BlueJeans for approximately $400 million. Verizon announced that it has entered into an agreement with BlueJeans Network, “a trusted enterprise-grade video conferencing and event platform.” BlueJeans has approximately 15,000 business customers.
BlueJeans’ cloud-based video service and meeting platform will be added to Verizon’s portfolio. BlueJean’s video service will run on Verizon’s networks. Verizon also plans to integrate BlueJeans into its roadmap for 5G, by “providing secure and real-time engagement solutions for high growth areas such a telemedicine, distance learning and field service work.”
“As the way we work continues to change, it is absolutely critical for businesses and public sector customers to have access to a comprehensive suite of offerings that are enterprise ready, secure, frictionless and that integrate with existing tools,” Tami Erwin, CEO of Verizon Business, said. “Collaboration and communications have become top of the agenda for businesses of all sizes and in all sectors in recent months. We are excited to combine the power of BlueJeans’ video platform with Verizon Business’ connectivity networks, platforms and solutions to meet our customers’ needs.”
“The combination of BlueJeans’ world class enterprise video collaboration platform and trusted brand with Verizon Business’ next generation edge computing innovation will deliver highly differentiated and compelling solutions to our joint customers,” Quentin Gallivan, CEO of BlueJeans Network, said. “We are very excited about joining the Verizon team and we truly believe the future of business communications starts today!”
The proposed acquisition comes amidst the COVID-19 pandemic, which has caused a boom in the use of teleconferencing software such as BlueJeans. Its competitor Zoom has grown in popularity, while facing multiple security issues, such as “Zoombombing” and accusations of unauthorized data transfer to Facebook. Zoom is currently facing litigation related to these incidents. Meanwhile, some companies and governments have banned employees from using Zoom.
Unlike Zoom, BlueJeans does not have a free version. “We see an opportunity with our distribution channel,” Verizon CEO Hans Vestberg said of competing with companies such as Zoom. Vestberg also noted that “Ultimately videoconferencing and video will be enormously important in 5G,” especially during the coronavirus pandemic and as the country re-opens.
Additionally, there could be net neutrality concerns once the deal closes if it appears that Verizon encourages users to utilize BlueJeans over other similar services.
The acquisition is expected to close in the second quarter of 2020. Verizon was advised by Debevoise & Plimpton. BlueJeans was advised by Evercore and Goodwin Proctor.