Zoom’s Five9 Purchase Under National Security Review

Zoom’s purchase of Five9, a leading intelligent cloud contact center provider, is undergoing a US national security review....
Zoom’s Five9 Purchase Under National Security Review
Written by Matt Milano

Zoom’s purchase of Five9, a leading intelligent cloud contact center provider, is undergoing a US national security review.

Zoom announced in July that it was purchasing Five9. Zoom has its roots in the enterprise market, before becoming a household name as a result of the COVID-19 pandemic. Looking to the post-pandemic market, Zoom is gearing up for a renewed focus on the enterprise market, making Five9’s contact center solution a natural fit.

The deal has come under US national security scrutiny as a result of Zoom’s perceived ties to China. The company’s CEO, Eric Yuan, was born in China despite being a US citizen. The company courted controversy in the early days of the pandemic by routing data through servers in China, including data for calls originating in North America. As a result of the backlash, the company added the ability for paid customers to choose which region their data flows through.

These concerns, however, were enough to spark additional scrutiny, especially since Five9 is a California-based telecommunications company. The Federal Communications Commission is an interagency committee tasked with protecting US telecommunications, and the DOJ requested it review the deal “to determine whether this application poses a risk to the national security or law enforcement interests of the United States.”

Despite the setback, Zoom told The Hill it still expects the deal to close in the first half of 2022.

“The Five9 acquisition is subject to certain telecom regulatory approvals,” the company told The Hill. “We have made filings with the various applicable regulatory agencies, and these approval processes are proceeding as expected.”

“We continue to anticipate receiving the required regulatory approvals to close the transaction in the first half of 2022,” the spokesperson continued.

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