Forbes - Dropbox - Tech's Hottest Startup

Previously:
Sync Files With Dropbox
Dropbox For iPad, Android
Dropbox, Androids, And Security
Dropbox Updated To Version 1.0
Sharing Files With Dropbox

Dropbox is profiled in the cover story in this week’s issue of Forbes. Since many of you rely on Dropbox, you might find it interesting – and perhaps reassuring – to read the article and confirm that Dropbox is a well-capitalized, well-run company with elegantly simple technology and a profitable business plan.

[If you’re new to Dropbox, this article has some background. At its heart, Dropbox is a free program to sync files among each of your computers and mobile devices; files in the special “Dropbox” folder appear on all the computers and devices running the software linked to your account. It is respected and widely used.]

Fifty million people use Dropbox now (three times more than a year ago), with a new user joining every second. 96% of those users don’t pay a dime for the service but every day thousands of people sign up for paid subscriptions. In the article, the CEO sums it up simply: sales will double next year even if the company doesn’t get a single new customer. At the moment the company has only 70 employees, mostly engineers, but the company is about to grow after getting a big venture capital investment last month.

Dropbox has had no major outages or data losses, to my knowledge. All files in Dropbox folders are stored online on Amazon’s global S3 servers. In some ways it’s similar to a backup service, since constantly updated copies of my files are stored online and on each of my computers. Deleted files are held for thirty days; each version of a file is saved for two weeks, in case I want to go back to an earlier version of a file in progress. It is one of the very few new services that is so simple that almost everyone just gets it. That’s a beautiful thing.

Not every high-flying tech company continues to be successful, of course. The Forbes article describes an early meeting with Steve Jobs, who offered to buy the company and promised to go after the file syncing market when the offer was politely refused. Today, some contrarians echo Jobs’ comment that Dropbox is offering “a feature, not a product,” to highlight the possibility that Apple, Google, or another company will take the place of Dropbox within a few years either by replacing it or acquiring it.

Sure enough, Apple is now rolling out it’s iCloud file syncing service for photos/music/videos, which millions of people will start to use without ever considering Dropbox. Apple’s file syncing service will be widely used by iPhone and iPad users, but that won’t be enough to completely displace Dropbox; Dropbox has the advantage of platform neutrality, creating apps for every computer operating system and every type of mobile device.

Microsoft has always had the ability to offer a service that would have compelling advantages for business users. It already has a file syncing program (Live Mesh) and online file storage (Skydrive), a combination that has some technical similarities to Dropbox. For years, though, Microsoft has steadfastly refused to develop Live Mesh and Skydrive into something that’s actually friendly and compelling. Here’s an article by Mcrosoft loyalists who lament Microsoft’s continuing failure to offer the right file syncing solution. A telling quote: “Interestingly, in a video “chat” among Forbes editors, in part discussing Dropbox’s potential competitors, smaller companies, Apple’s iCloud, and a potential move into the space by Google are all seen as threats, but Microsoft and SkyDrive aren’t even mentioned.”

Microsoft has delivered half-baked Office Web Apps, online versions of Word/ Excel/ Powerpoint/ OneNote. If Dropbox could hook into those apps so that files could be opened and saved between the web apps and Dropbox, we’d have everything we needed – local access to our files on our own computers, and online access to keep working on those files when we’re away from our computers.

So far there is no hint that Microsoft will let that happen. There is also no hint that Microsoft is working on something of its own that would deliver the same flexibility. It continues to be a frustrating hole in our technology landscape and I’m anxious for someone to fill it.

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