Verizon’s shuttering of BlueJeans earlier this month sent shockwaves around the UC and collaboration world.
In a message emailed to BlueJeans’ service members — and published by 9to5Google — on Tuesday, August 8, Verizon confirmed that the platform’s suite of products was being “sunset” due to what the vendor described as an evolving and volatile market situation.
Verizon acquired BlueJeans — a business-targeted video conferencing app — in a deal estimated between $400 and $500 million in spring 2020 at the height of the COVID-19 pandemic. The acquisition was based on Verizon identifying a market opportunity to compete with Zoom, Microsoft Teams and Google Hangout as the world adapted to the new reality of remote and hybrid working.
Just over three years later, the sun has set on the BlueJeans project. It begs the question — Where did it all go wrong?
“They were definitely at that ‘buy, borrow, build’ decision stage during the pandemic,” Craig Durr, Senior Analyst, Futurum Group, told UC Today. “‘I need to have some kind of video conferencing service integrated with what I’m doing.’ And they went with the buy option.”
Durr suggested that one of the main challenges for BlueJeans was trying to balance converting the existing Verizon customer base over to the BlueJeans service and growing net new customers.
“I think they tried both strategies,” Durr said, “but I didn’t pick up on a large transition on internal harvesting of people who were using Verizon services for business telephony and things of that nature. Using that for unified communications or as an entryway into unified communications, inclusive of video. I just think it was an example of them not being able to integrate it properly or get that proper conversion rate going.”
Evan Kirstel, Social Media Strategist, BCStrategies, wryly noted the steep acquisition price of BlueJeans couldn’t have helped with the burden of market expectation: “I think we all spent too much money during the pandemic. We didn’t spend $500 million on BlueJeans but too much money on Amazon!”
“All kidding aside, I think it shows the challenges that Verizon and its peer AT&T have in the enterprise, that they’re kind of the Walmart of enterprise communications,” Kirstel expanded. “They’re great when you know what you need to buy. You go into the store, take it off the shelf, and get a good price.
“But that’s not going to sell and market and position you as a product in the ‘Walmart’ store. That’s what was lacking. It was that go-to-market, that selling, that marketing, that positioning, that hyper-competitive landscape in video that they sadly couldn’t differentiate themselves from.”
Irwin Lazar, President, Metrigy, highlighted that not only was Verizon struggling to differentiate itself in a crowded UC space but that it was “competing against its partners”.
“They had very strong partner relationships with Microsoft and Cisco via Webex and Microsoft Teams, so what’s the use case for BlueJeans?” Lazar continued. “It’s hard for them to make that argument to their customers.”
Both the clunkiness of Verizon competing with partners and the vendor’s jack-of-all-trades, master-of-some versatility across industries was identified by Zeus Kerravala, Principal Analyst, ZK Research, who described them as a “multiheaded dragon in UC”, albeit that became a problem.
“Verizon is always willing to do what the customer wants,” Kerravala said, “and that’s why they have so many UC relationships. They’ve had the Webex relationship for a long time, they’re big into Teams, and they have the RingCentral partnership now. Where does BlueJeans fit into all that?”
“I think, initially, they thought they could sell it down-market to small customers as part of an overall bundle, but even those customers tended to use Zoom and things at home. I think if they really wanted to have BlueJeans work, if they could go back in time, maybe create a freemium version of BlueJeans and try to seed the down-market, at least give it to the home subscribers to use to talk to your loved ones or something like that.”
“I’ve been saying this for a while about the UC market,” Kerravala added, “It just seems like the supply far outweighs the demand today, especially with Microsoft taking up so big a chunk of the market. BlueJeans is a good product, I just think it’s a solution looking for a problem. It just doesn’t do anything new or differentiate.”
Jon Arnold, Principal Analyst, J Arnold & Associates, pointed out that BlueJeans’ offering became possibly outmoded since the acquisition was made as the market doesn’t differentiate on standalone video in 2023.
“Pexip is still around, I don’t understand that, but those pure plays for video, there’s just not a market for it,” Arnold argued. “Zoom and Teams, for that matter, have obliterated all that.”
Durr agreed that the UC market has evolved so significantly over the past couple of years that even producing the highest quality video service isn’t enough to thrive anymore.
“The video quality across all of these platforms is pretty much getting to be on par,” Durr explained. “It’s difficult to distinguish, so it’s other value adds, other sell opportunities that these guys just weren’t able to get alignment.”
“You’re right (Zeus). There was a strong SMB play or at least a hope for that, but there was no uptake. Maybe those guys are looking for aligns with their productivity suites like Teams or what aligns with other investments they have like Zoom. So it was always a challenge.”
