I don't see much long-term growth for Dropbox in its current state. Right now, they're a stopgap feature. They've been successful so far because they fill a niche, but the niche that they fill is temporary. Old computing is having your files on your computer and accessing them with local applications. New computing is having your files in the cloud and accessing them from applications in the cloud. In a fully cloud-hosted architecture, there is no need for dropbox. Dropbox is a halfway point in getting us into the cloud, and as more and more apps move into the cloud they will become more and more unnecessary.
Dropbox have one special ingredient - it actually works. Do you think Samsung or Acer are going to come up with something robust and resilient? Even if they did, do you think it would work on Mac or iOS or WP7? Do you think Microsoft's solution would work outside of Windows?
Heck even Ubuntu One (which only had to work on one operating system whose source they had) never worked reliably for me. (I ended up with machines in the admin centre multiple times, and about once a month one of my machines would silently decide to stop syncing files.)
Doing 80% of a file solution that works some of the time in some of the places is easy. Doing the rest is something that only Dropbox has managed.
As for long term growth, consider that for each of us the amount of digital data we have keeps growing, that we often want to share differing parts of it with different groups and that there keep being new kinds of data beyond just "binary files".
Put another way, ask any Dropbox user if there is more they wish it did. You'll get a long list back. Where there is demand, there is opportunity and growth. They have a list of over 6,500 different requests at their website:
you're missing what i'm saying. i don't think there's an opportunity for competition dropbox's market, they are undoubtedly the best at what they do and their users love them. they do a great job, but i think that the job they're doing is going to become irrelevant soon.
>As for long term growth, consider that for each of us the amount of digital data we have keeps growing
the amount of digital data i have is not growing, it's shrinking at an alarming pace. i don't have any documents. google has documents that i have authored, and i can retrieve them from google any time i want to, but i don't have them and i don't have to worry about where they're stored. i don't need a service to keep them synced between my computers because they're not on my computers. i let google worry about delivering them to me.
>there keeps being new kinds of data beyond binary files
this is what i'm talking about. dropbox keeps track of binary files. it doesn't currently handle new, less tangible types of data, and until it does its potential is pretty limited.
Hard though it may be for people that live in the Valley and work as programmers to believe, most of the world isn't permanently connected to adequate-speed internet. For the 99%, they do need to worry about where files are stored, specifically why they can't access them even on the laptop they used to create them.
That's why Dropbox will continue to annihilate any service that doesn't locally save data. If my files are in Dropbox I can freely access them on the laptop I used to create them whether I'm sitting in a hotel that has so many stars you have to pay for WiFi or on a beach in Thailand. And the next time I have my laptop on within the range of publicly accessible free WiFi, it's all in the "cloud". If the internet connection is extremely intermittent I can have my updates save asynchronously without the endless frustration of browser error messages (or even worse, an Ajax smokescreen concealing the failure of an app to update server-side).
And even if I'm sitting in my office with a perfect high-speed connection doing average office work, the chances are that at some stage I'll be using a program with functionality not available in filesystem-less SaaS. In which case I don't really begrudge the extra few gigs of disk space Dropbox takes over pure cloud hosting.
Doing a crappy subset of their job will become irrelevant - I certainly agree about that. Doing the "whole" job is really what we are debating. I'd make the case that having lots of crappy different services out there is what provides the case for something that can aggregate, backup and provide access to those pieces. (Only time will prove that right or wrong.)
> the amount of digital data i have is not growing, it's shrinking at an alarming pace
You then list how you have new digital data in the form of Google documents :-) They used to only have a few types of data ("documents" and spreadsheets). You now also get presentations, drawings, forms, tables and collections. And guess what, Google do indeed provide a crappy subset of their experience. Have you every tried to edit/view a Google doc on an Android device? I'd be delighted to have those docs also sitting in Dropbox available on all my devices at all times and to the many local programs I have that provide better viewers/editors than Google ever will. (Note this doesn't mean I want Dropbox to be the primary location for them, just that I want Dropbox to provide enhanced access and backup.)
> dropbox keeps track of binary files. it doesn't currently handle new, less tangible types of data, and until it does its potential is pretty limited
It does handle photos and sharing. I agree that binary plus photos is limiting, but the whole point is that by expanding beyond that they will have the opportunity for growth.
"google has documents that i have authored, and i can retrieve them from google any time i want to, but i don't have them and i don't have to worry about where they're stored."
You should really automate backups of your google docs to local storage. I've lost data when documents inexplicably disappeared.
I agree right now, but I've learned to suppress my initial reactions on these things. I thought Facebook had basically exhausted their niche in early 2007 and there was nowhere to go for them, and that's turned out to be pretty false. Only time can tell whether a startup ends up becoming another Facebook or another Digg.
It's not really where you are now that matters, but where you end up going. And Drew's a really smart guy and maniacally focused on his company. It's quite possible he sees things about their market that we don't.
True, but "most files" still doesn't cut it. I have great hopes for the upcoming Google Drive, it would solve many of the problems I'm facing right now in project management (I wrote about it on my blog: http://luckyisgood.com/blog/google-drive/) - and support for all file types is essential if Google wants to call its service "cloud storage".
I've been with Dropbox forever (I have account #315) but man, it is tempting to snag 80GB for the price of half a tank of gas.
Convenience is obviously the primary loss. But I'm a nerd. It would likely be easy to figure out some way of auto-syncing my whole music folder.
My other primary usage for Dropbox (and incidentally the motivation for its inception) is as a way to transfer files to other people. There's nothing like being able to host your own .html file within your own dropbox with literally zero effort. That said, a hybrid of the two seems best -- ridiculously cheap bulk storage, combined with the convenience of Dropbox when needed.
Facebook didnt grow much (functionality-wise) other than in number of members. Other than that, most features are exactly the same as in 2007. No wonder; an average programmer could write Facebook core functionality in a matter of few days; the major issue/challange at Facebook is scalling, not programming. Show me other piece of software that is concurrently accessed by hundred million users.
Early 2007 was before Facebook Apps came out. There was no Farmville, no SuperPoke, no Scrabulous, no Washington Post Social Reader. It was also before Facebook Status Messages (IIRC a reaction to Twitter, which hadn't gained traction yet), before the News Feed (IIRC a reaction to Friendfeed, which wouldn't be founded for another few months), before the Facebook Mobile App (the iPhone was brand new and didn't yet allow 3rd-party apps, Android hadn't come out yet), and the UI was completely different. There was no Facebook Connect or Like button.
Dropbox already has a platform (it's API). You can already save directly to your Dropbox from a variety of sites. Still, not a whole bunch of folks use this functionality.
I disagree, I see dropbox files as MY FILES. I don't like when they are obscured behind some application. I don't see those as MY FILES, I like to see my files in my folders and it's nice and I have a sense of ownership. Dropbox is just an extension of my own personal home filesystem. But it's EVERYWHERE. And that my friends, is what makes all the difference. Like Drew said, he wants a filesystem for the internet. I think this is lost on lots of "the cloud" proponents, who are focused just on applications.
I see dropbox files as MY FILES. I don't like when
they are obscured behind some application
The important thing is that it's YOU (and me), not the average computer user. Apple and Google are successful because they fill average users' needs with simple, intuitive and easy to use products; not by presenting them with an scary concept like 'file system'.
I hate it when I'm on my iPad and have to do all sorts of stupid tricks to move files between applications. It's just stupid. But I'm sure Apple will fix most of the nightmare in iOS 6.
But I must side with Steve Jobs when he said "When you try and teach someone to use a Mac, everything is fine, until you show them the file system."
Average computer users have extremely cluttered and unorganized folders and desktops. Dropbox does not help that.
I think Apple's strategy will work better for them (in the long term) than that of Dropbox's...
“A lot of us have been working for 10 years to get rid of the file system so the user doesn't have to learn about it.” (Jobs, WWDC 2011)
And this is my favorite quote about Dropbox:
"Dropbox... It's a feature, not a company"! (Steve Jobs)
"scary concept like 'file system'." I find that somewhat ironic considering it was meant to be intuitive and relate to the real world concept of Document,Files and Folders. But when the real world connection begins to be broken I can see how it becomes scary.
The problem is that in the real world managing documents, files and folders is a full time job for some people.
If documents, files and folders were intuitive and efficient, you wouldn't have relatively huge administrative staffs at medical clinics, real estate offices, banks, law offices, government institutions, schools, et cetera.
you have to admit that you're the minority though. the average user doesn't like files. if you've ever done end-user support, you've seen how foreign the whole concept of a filesystem is to most of them. the goal in an average use case is not to modify a file, as so much software seems designed to do, it is to generate some output. people don't open up microsoft word so they can write a letter and save it on their hard drive, they open up word so they can write a letter and print it out. the fact that it gets saved at all is mostly incidental to them, where it gets saved is totally irrelevant.
The average user doesn't buy an Apple computer either, or own an iPhone. Heck, even the average smartphone user doesn't have an iPhone. Yet Apple does quite well for itself.
You're only technically correct because of how averages work. Novice computer users make up a major part of Apple's demographic, and often times their products are more suitable. More specifically, there are a number of features in Mac OSX which simplify the file system for novice users, including "All My Files", "Date Last Opened"/"Date Added" sorting capabilities, and browsable folders straight from the dock.
At the moment each OS vendor is pushing their own cloud solution (Azure, iCloud, Kindle Amazon cloud storage)
Dropbox could become the universal cloud storage, which can be accessed using identical APIs on every platform, thus becoming the single store for users working with multiple operating systems. Furthermore, application programmers will only have to target this one API.
I think Dropbox can remain relevant by getting cloud apps to save their files on Dropbox accounts. This actually also helps the end users, whose files won't be locked away by whatever apps they use.
But why can't Dropbox become the main provider for this fully cloud-hosted architecture? So I keep my cloud files in Dropbox, and grant my cloud apps access to subsets of those files. Then they would truly be the "filesystem of the web" and the growth/profit prospects are rosy.
For example, http://leanpub.com/ uses Dropbox in an interesting way. As Dropbox beefs up their API and adds features, I think there are many interesting growth/monetization possibilities. I think the main danger is the competition from Google/Apple/MS.
The main danger for Dropbox is the commoditization of cloud storage, and filesystem abstraction. Dropbox style sharing going to be commonplace, everything will interact with the cloud, and web apps will abstract data in ways that make the conventional metaphors of files and directories obsolete. Plus as Amazon improves their API's and competitors emerge, Dropbox will get squeezed from every possible direction. They should pump and and dump while the market's good.
I was also surprised at their massive funding rounds too. Perhaps there's more room for growth than it seems...
Or maybe they are perfectly positioned to provide the "fully cloud-hosted architecture" itself: technology experience and market leadership. Under this hypothesis, they are hard at work on a general cloud platform behind the scenes, and that's their pitch to investors.
I don't understand this either, it's a commodity and everyone is doing it now. They don't seem to have special patents. I use Ubuntu One for example (5GB free) and there will be Google Drive soon.
Even when you count out the cloud future, how can Dropbox stay competitive against Google's infrastructure? They have peering contracts and their own servers.
Is there actually any of the services offering a client based encryption? So far I am using Dropbox only for exchanging pdfs and other non-personal stuff.
I've been relatively happy with using wuala to sync directories. My only gripe so far has been the android client seems to keep everything as temporary.
I agree. Bitcasa will be a big player. One of the advantage Bitcasa has over Dropbox right now is that it can show the versions of your file right from the app. You don't have to go to the web. And we even didn't speak about pricing.
I didn't try Bitcasa yet since I got today an invitation.
And what makes those companies so successful in those areas is that it is very difficult to replicate what they do. It is not as difficult to replicate what Dropbox does, as noted by what your parent poster said.
Is it that difficult to replicate what Apple does, provided that you have enough resources? I don't think so. But, still, companies fail to do so.
Yes, what Dropbox does right now does not add up to much, but if they keep expanding their usefulness they could end up reaching a critical mass. Dropbox' business is not a niche: everyone needs effortless backups and file sharing. Everyone. Tomorrow they could be a major cloud storage company indeed.
> Is it that difficult to replicate what Apple does, provided that you have enough resources? I don't think so. But, still, companies fail to do so.
Replicating Apple's brand/image is what's hard. That brand has taken years of focusing on Apple's/Steve Jobs's particular style of doing business and building products. We see people trying now to replicate that, but it took Apple all of the 2000s to get its brand to where it is.
I agree. But how many companies do you see really focusing on their image and consumer experience? I used to be a fan of Nokia mobile phones and their ease of use, but as I upgraded to a Nokia 5800 I was disappointed, and lost my faith in that brand.
> But how many companies do you see really focusing on their image and consumer experience?
Not many, because it's hard and risky and - drum roll - difficult to replicate! Which brings us back to why I feel a direct comparison between Dropbox and Apple/Google is flawed: Dropbox presents comparatively little consumer value that is difficult to replicate. Hell, they don't even handle their own storage, Amazon does.
> Not many, because it's hard and risky and - drum roll - difficult to replicate!
I don't think so. IMO, companies do not focus on their image and consumer experience because most CEOs are not entrepreneurs, and lack vision. They have risen to the top not only because of their performance, but mostly because they have been very good at office politics. Think about companies who have a strong personality instead: don't you realize they are run - have been run - by entrepreneurs (Steve Jobs, Richard Branson, etc.)? OTOH, for CEOs who do not own their company, focus is most exclusively either on their company's stockholders or their company's board of directors.
> Hell, they don't even handle their own storage, Amazon does.
It's called "outsourcing". The most successful fashion companies do not own any factories (Nike, etc.).
EDIT: Actually, it has just occurred to me that some companies which have a strong personality without having an entrepreneur as their CEO are companies which do not own their assets, that is companies whose main product is marketing.
I agree with you. I'm not sure why email, with a few added features, can't just replace dropbox completely. I have more space in gmail (and unlimited space on yahoo) than I do on dropbox, for free. Email syncs better than dropbox on every machine I have because I don't need additional software. The only other limitation is sharing but I think this is where something like "wave" would have worked.
They may be a stopgap feature right now, but they can evolve. Every successful company starts by filling a niche, and then keep expanding such niche till it reaches its critical mass.
While Dropbox is a great service (I can't imagine life without it!), it's a bit delusional to think it could be the next Google or Apple. As Steve Jobs himself said about Dropbox, it's a feature, not a company.
Technically, search is a feature too. Google seems to be doing alright. I think that was just Steve being steve, and saying whatever would scare the piss outta Dropbox to get them to sell. If it's such a bad Idea, why did jobs want to buy it?
> Technically, search is a feature too. Google seems to be doing alright.
That's because they were able to monetize search enormously through ads. How precisely does Dropbox plan to monetize storage to the same extent?
> If it's such a bad Idea, why did jobs want to buy it?
Strawman. Nobody is saying Dropbox is a bad idea. They are saying it is likely not an idea capable of being an "Apple or Google." Edit: also, a Hacker News reader should be well aware of talent acquisitions.
Yeah, it's important to realize he could be both really right on some things and really wrong on others. However, here I think he's right. They play in a space that is so important to the OS vendors' product and strategy. It's hard to imagine sync remaining 3rd party forever.
Competition will drive prices down such that even if Dropbox corners the market they won't have the revenue of Apple or Google.
I mean, Dropbox is revolutionary, but it's not that hard to replicate.
In the end, they're selling storage, not their technology. Which is another factor that will drive down their revenues: storage is reliably getting cheaper.
They are selling ease-of-use. Filesharing between multiple PC's you owned along with potentially PC's of colleagues was always difficult and cumbersome.
Dropbox pioneered an easy way to make file sharing among machines as simple as dragging files to a pre-defined location on your PC.
And even this concept wasn't entirely new, Microsoft's "Briefcase" in Windows95 was basically an early version of this.
Dropbox's success is all about the simple execution of a task that impacts millions of PC owners, and removing the difficulty of performing that task.
Will filesharing make Dropbox the next Apple or Google? Doubtful. BUT, there are still several pain-in-the-ass little nuances about the multi-device world. IMO, they might look next to the overall interaction and data management among a household of PC/Tablet/Laptop/Smartphone users.
One example: I have a set of contacts on my laptop. Call it "Everyone I know", My wife has a similar set of contacts on her PC. Some of these contacts are duplicates (family members), others are unique to each of us (personal friends or business associates). On each of our phones we have a subset of these contacts. I'm not a fan of having an over-filled phone contact list, I want to keep it to the most commonly-contacted people. My iPad has a completely separate contact list that is all disorganized.
I'd like an easy way to manage a contact pool among multiple users and devices much like Dropbox manages files. I'd like to be able to edit or update certain info in my company address book, and sync certain contacts to certain devices.
Dropbox has a huge opportunity just in making all sorts of information appear and share in just the locations we want it to be, among many other things.
Everything you described with regards to your contacts lists I've already been doing with Google Contacts (work contacts, shared contacts with wife, etc).
My Android phone lets me easily sort and categorize my contacts, and only see what I want to (while keeping all of the data I still may want to get to in the background).
> I mean, Dropbox is revolutionary, but it's not that hard to replicate.
I'd tend to agree with you but I'm not seeing the competition emerge. Sure, I've got 50GB on Box.net for free but I have to go through their website to get anything done. I've got SpiderOak, who seem quite technically impressive but they're more of an online backup system. I've tried a handful of others (Ge.tt? Amazon, Apple's cloud thing) and they all do what they're designed to do but they seem to miss the brilliant simplicity of Dropbox, that it works like I work, with files and folders.
On that point I disagree with you, Dropbox is not selling storage, they're selling an easy way to do something that was hard.
Maybe these other companies are not trying to compete, maybe they're looking to differentiate elsewhere. I keep seeing companies and even projects on Github that claim to be competing but seem to miss this essential point, that they're competing with seamlessness, with elegant simplicity, not with an online storage product.
"Drew Houston, 28, chief executive and co-founder of Dropbox, last fall pocketed $250 million from seven of Silicon Valley's top venture capital firms."
"Dropbox engineers even hacked their way into Apple's file system to make the Dropbox icon appear on users' menu bars, a bold feat that blew away Apple's cloud team and caught the attention of none other than Jobs."
I have never made an application which does it, but I know of plenty that do (e.g. Evernote). Is it really that difficult?
It is quite difficult, as well as painstaking. I can't find the article where Drew Houston was mentioning this, but because the API method wasn't available, they had to use a hex editor and alter the memory location to get the functionality to appear in the finder. And they needed to do this for every version of OS X as the Finder memory address to inject the assembler/C code would be in different locations depending on the version. The process would be similar to writing a crack for software to find the algorithm for the serial key check.
Besides Dropbox being a great service, what got Steve Job's attention was the fact that the internal cloud team was impressed on how Dropbox managed to do this, since they themselves couldn't get the OS X team's cooperation for a similar feature.
I wonder if this is a mistake. I thought the hack was not the menu bar but messing with the icons in the finder so they have a status icon on top of the normal file icon (so a checkbox if they're uploaded to the server). That's quite a bit less common than menu bar changes and I think when they first did it, there was not an API for it (not sure if there is now in Lion).
Are you suggesting that Dropbox is going to hit multi-billions through advertising? To successfully complete your analogy, you need to fill in the gap between "hosting files for free for most of their customers" and multiple billions of dollars.
I am not suggesting exactly that, no. But it is possible to make large amounts of money without being paid by the people using your service, if there is a ridiculously large amount of those people. Google is the best example, that part is true.
To be more concrete, there are at least two possible ways for something like Dropbox to make money without users paying Dropbox directly:
* Data mine the files hosted for users. Even anonymized data like this can be very valuable for third parties. Edit: or for other separate services inside your own company.
* Ads that become an integral part of the Dropbox service, preferably targeted using data mining from the previous point.
I do the same. I have bought one 50GB account for me, one for my partner, and one of my companies have bought a Team account.
The plural of anecdote is not data. How many people did you refer to get the free storage you needed? How long do you think it will be before you need more and pony up?
Your point is well taken, and they are clearly generating a non-trivial amount of revenue.
But my point wasn't "they're losing money and making it up on volume"; more that true juggernauts like Apple and Google have business models that derive at least some additional incremental revenue from every user they acquire. Google obviously plays a longer game to receive that revenue through advertising than Apple does selling hardware, but the revenue does eventually arrive.
Dropbox needs to pull an "Amazon" and pivot like they did with AWS, and Apple did with the iPod. Storage is not going to take them there. Growth is limited and someone can easily come along and replace them. They need a secondary source of income.
The way the Dropbox execs have been talking themselves up in the press over the last few months just makes me think that they're angling to raise the price on an acquisition.
Dropbox is a great product, but feature development has stagnated, and the only two expansion options I see are:
* compete with Amazon in a much more user-centric way.
* compete with Apple iCloud in a much more open way.
I'm late to the thread, but I'd like to share how I use dropbox and share some of my issues.
I have been a long time user, and recently I joined a company which is 100% virtual. We are all consultants who work from our homes - but travel regularly to client sites.
While we are working from our homes - we collaborate and work on the docs needed for our client visits.
Everyone has their own account, and quickly a couple gigs would fill up, due to what i feel is poor logic on dropbox's part, and it is getting to be a bigger and bigger issue.
The issue is that we have ~10 people all sharing project folders. But with the free account, this means we get a lot of duplicated consumption.
If 3 people have 2GB space, and they each share .5GB with eachother, then that .5GB is taking up .5GB from everyones account.
This sucks.
Personally, I have a paid 50GB account, and I created a shared public folder. Everyone on my team joined the public folder - which is always 50GB to ME - but to them it consumes THEIR space - and soon their syncing stops because the folder I made is larger than their box.
This is retarded, I think that if they visit MY folder, this should not count against THEIR storage - especially when I am paying for it.
I do undestand the complexities of this - but then the problem is that the cost to fix this issue is that everyone needs to upgrade their account.
I have looked at the team offering, but then that is too expensive.
I think what is best - is to have one corporate DB account, and have everyone login with that userID - and pay for the upgraded space for that one account.
With this said, based on the current design of dropbox and the fact that it is simply a feature - there is no way this company will be the next Apple, let alone google. Unless Drew is referring to emulating their culture, or maybe brand recognition. certainly he cant be talking about product diversity....
Anyway - I love dropbox, and am happy to pay for it, but as it currently stands, is a half-feature.
I dont even know what kind of use-case model for teams such as mine they are looking at. Perhaps I should send them an email.
> The customer service was not just bad, but noticeably absent...
I couldn't agree more -- I also pay for a 50 gig plan. About a week ago, I had to rebuild one of my machines and somehow my new Dropbox folder (which of course was empty) synced out to the cloud and to the rest of my machines. Suddenly my backup consolidation was completely wiped out. I submitted a support ticket and even now, nearly a week later, it is still unassigned. So, I spent a day undeleting 3500+ files through their web interface. Although quite limited, I will say I was thankful that functionality was there.
After being so impressed with Dropbox, their lack of customer support has been a huge disappointment.
I know it would be relatively small but can anyone wager a guess as to how much each of the 2gb freemium packages costs Dropbox? At 50 million users it has to add up--I've always wondered about Dropbox's conversion rate (free to pay) but it must be relatively high to support the current monetary system.
Keep in mind that they use S3, so they pay for what they use, not what they have committed to their free users. But if they were, then for 50 million free users:
2gb * 50,000,000 = 100PB. That would qualify them for S3's over 5PB pricing of $0.055 per GB-month. So that's $66 million per year just for storage.
But again... they're probably actually using far, far less than 100PB on their free customers.
>He'd strap on headphones to block out everything but the endorphin rush as he cranked code late into the night on a new service that instantly syncs all of your files on all of your devices.
sigh Thought we were done with the hacker cliches?
I remember reading an article a few years ago by (I think) a novelist who envisioned that in the future we'd store our entire computing system online and just switch between devices, always having access to our environment and files. Whether you're on a smart phone, your home computer, or at a terminal in the library, etc.
I don't believe dropbox is going to do that, but it is an interesting idea.
that is pretty much what google is doing with the chromebook. a local terminal with not much state storage, keeping all of the important data in the cloud. they're trying to do the same thing with android (which is why the google nexus phones keep coming out with such small amounts of flash storage).
mobile devices are powerful enough and desktops/laptops are cheap enough now that the computation can be done locally, with the data still being stored on a central server. a decade or two ago, the computation was also done on the servers. microsoft did it with windows terminal server, sun did it with the ray (https://en.wikipedia.org/wiki/Sun_Ray), but the concept was basically like vnc'ing into a central server and having your entire session preserved, no matter where you logged in from.
and of course, before graphical desktops were big, unix and dumb terminals did the same thing. you could use a vt100 connected to a modem from anywhere, run 'screen -r' and restore your saved session to access all of your applications, data, and email stored on the server.
I can see that too. But I can also see somebody like VMWare getting there first--a gigantic, centralized cloud VM repository is not difficult to imagine, and they already have a bunch of technology needed to move a VM from a server to a computer (I think).
