In order to better serve its business customers, Verizon Business has entered into an agreement to buy video conferencing company BlueJeans Network.
Citing an unnamed source, the Wall Street Journal reported on Thursday that Verizon acquired BlueJeans Network, which has more than 15,000 customers, for less than $500 million.
Verizon Business is buying BlueJeans to beef up its business group as it rolls out 5G and targets new wireless applications at its business customers. Verizon could use BlueJeans' video conferencing platform to help companies in high growth areas such as remote training, distance learning and field service work.
Verizon said BlueJeans' cloud-based video service will be folded in to its unified communications portfolio and that it will be "deeply integrated" into its 5G roadmap.
“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,” said Tami Erwin, CEO of Verizon Business, in a statement. “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.”
BlueJeans founders and key members of its management team will join Verizon while BlueJeans' employees will become Verizon employees once the deal closes.
Verizon Business struck the deal for a video conferencing platform as millions of employees across the globe are now working remotely due to the coronavirus pandemic. Video conferencing usage has exploded across rival platforms such as Zoom Video Communications and Cisco's Webex.
While Zoom has been under fire for its lack of security encryption, which has led to "Zoombombing" by uninvited conference participants, BlueJeans encrypts its video sessions. Unlike Zoom, which is free for use by businesses and consumers, BlueJeans was designed as a business application.
According to Crunchbase, BlueJeans was founded in 2009 by Alagu Periyannan and Krish Ramakrishnan. BlueJeans has raised $175 million in venture capital, according to the Wall Street Journal story.
According to its website, BlueJeans' customer roster includes LinkedIn, Red Hat, ADP, Zillow and Facebook. In addition to video conferencing, BlueJeans also hosts audio conferencing and webinars.
Verizon Business, which serves large enterprises, has a revenue stream of about $30 billion and roughly 5,000 global accounts across healthcare, banking and other large verticals.
The deal is slated to close in the second quarter once it passes the customary closing conditions.