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Home / Technology

Dropbox pushes for bigger space

By James Titcomb
Daily Telegraph UK·
12 Nov, 2015 04:00 PM4 mins to read

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Dropbox was started in 2006 when founder Drew Houston began a service that stores files in the cloud, allowing users to access them online and from any device, and share them with others. Photo / Getty Images

Dropbox was started in 2006 when founder Drew Houston began a service that stores files in the cloud, allowing users to access them online and from any device, and share them with others. Photo / Getty Images

Founder hopes to convert millions of users into corporate customers hoping that IT departments will buy in.

Despite the occasional outbreak of neo-luddism, one likes to think most people agree that the internet has made our lives better. Instant global communication has transformed huge parts of our daily lives.

But there is a major aspect that has been stubbornly slow to change: office life.

Although most of us have powerful computers in our pockets, workers often remain tied to their desks. We spend hours in meetings. A generation ago, office technology was miles ahead of that in the home; now the reverse is true. And email is taking hours out of every working day.

A clutch of tech startups are now trying to make work better. Dropbox is one of the most high-profile.

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Dropbox was started in 2006 when founder Drew Houston began a service that stores files in the cloud, allowing users to access them online and from any device, and share them with others.

Dropbox essentially replicated the files and folders system that we are used to on our home computers in a "magic folder" in the cloud, and made it work seamlessly. "It just works" is an expression commonly associated with Apple, but is also displayed on a wall at Dropbox's San Francisco headquarters.

Steve Jobs even believed that Dropbox would be a perfect fit for Apple. In 2009, Jobs made the 28-year-old Houston a nine-digit offer. When Houston said no, determined to build his own business, Jobs cast doubt on Dropbox's ability to go it alone, saying its service was "a feature, not a product".

Although Dropbox grew rapidly, earning a US$10 billion private valuation two years ago, several critics have suggested recently that Jobs may have had a point.

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Shortly before Jobs' death in 2011, he announced iCloud, which lets Apple users share documents, music and photos online. A year later, Google unveiled Drive, a direct rival to Dropbox. Microsoft and Amazon also offer similar products, so the world's four biggest technology companies are now in competition with Dropbox. And the cost of online storage has shrunk to next-to-nothing thanks to internet hosting providers like Amazon Web Services.

Dropbox's core product, critics argue, has been commoditised. The service is still among the best out there, but core features have been replicated at companies with much bigger footprints.

Which brings us back to the modern office. As it has faced stiff competition in the consumer world, Dropbox has restyled itself as a business that sells to businesses, promising to solve many of the inefficiencies that plague the modern workplace.

"This world is still way more complicated than it needs to be," says Houston.

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"We all see the things that have changed, but I'm kind of shocked at how much things have stayed the same. We're still using the same old tools and workflows, and we spend our time duct-taping these tools together from the last 40 years of computing."

Dropbox, and other startups like Slack, Quip and Asana, are all trying to solve this problem. Dropbox launched a "for business" service in 2011, adding new features that allow workers to collaborate and communicate within the service. It promises to introduce many more.

The vision Houston is selling is one of effortless connections between workers in a fragmented world, in which everything is available no matter where workers are, letting them pick up work seamlessly and be far more productive.

Dropbox hopes to convert its huge base of 400 million personal users, many of whom already use the service at work, into corporate customers.

It is a route that has worked well for Apple, which now has a US$25 billion ($38 billion) revenue enterprise business largely because executives wanted to be able to use their iPads at work, but there are questions about whether Dropbox can follow.

It has some big competitors. Google and Microsoft are signing companies up to their cloud computing tools, as is Box, a direct rival.

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And analysts have raised questions about whether Dropbox can convince slow-moving and security-conscious IT departments to adopt its service.

But the potential prize - making the outdated way offices operate less frustrating - is a huge one.

If Dropbox can change the way the world works, its US$10 billion valuation will be justified many times over.

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