When I was in YC (same batch as Dropbox) this was a constant question. "What happens to Dropbox if Gdrive launches?" I don't actually remember what Drew and Arash thought, but a lot of people speculated on it.
It was probably a real threat to them 4.5 years ago. I can't imagine it is now. Dropbox has a large, happy fanbase that's going to keep using it and keep spreading. They're going to keep growing. They've got a small bit of lock-in if you use them a lot too, the annoyance of having to upload a large amount of files to another service. They've got a product that's a joy to use, which is not something Google is known for building outside of their core competency of search.
If I were Dropbox I'd simply view this as market validation (not that they need it at this point) more than anything else.
You'd be surprised how difficult "giving it away" can be, even for Google. Google succeeded big on giving away email, search, and androids. Do I need to list up all the acquisitions and products that even with a mortal lock on navigation on the Internet Google couldn't convince people was worth at least $0?
Agreed. File sharing is the type of thing where you can't just rely on first-mover-advantage. Google has the ability and infrastructure to offer more space for free on more devices and platforms.
Dropbox was not the first mover [1]. In fact, their entrance into the market for cloud storage/sync is in a way analogous to Google's entrance into search.
You're second point sounds right. But to me, Dropbox has always been about the UX and convenience rather than the cost / space.
I think it will be interesting to see what Google launches.
I WISH I could remember who said it, but I applies here and in so many other areas: You must offer the consumer something MUCH better than what they already have to get them to switch from something they like. Google Maps dis this when Mapquest was the standard.
I agree with what you wrote mostly.
What dropbox could do to mess up and give Google a chance to do something much better is this: don't give people more free space when the average user struggles with the 2GB limit.
One of the things that made gmail a success was that hotmail and the rest cheaper out on space. People had to constantly clean up their 2MB mailboxes. Google might be able to do the same again if dropbox don't offer more space for free. But that would take away from their earnings, so it isn't an easy problem to solve.
File sharing is the type of thing where you can't just rely on first-mover-advantage.
Yes, especially in a market where there are many, many users of computers who might have occasion to share files who have not used (or even heard of) any of the available file-sharing solutions yet. I am a sporadic user of Dropbox strictly for back-up of documents I produce, and a moderately frequent user of Google Docs for collaborative editing who knows a lot of other Google Docs users. I could see Google making huge gains in market share, turning it into tomorrow's "first mover" from the point of view of most users, for a file-sharing service.
I didn't get why Dropbox was so popular when I was using it the same way you are right now. Okay, it's a convenient way to make backups, but so what?
Then I started using it for sharing. Man, it's magic - I've never had it be so painless to share things. I can put a folder in my dropbox, share it to a few emails, and then everyone just has it later in the day. Man, that's cool. I can also create unlimited of those folders easily to control who gets what documents/files. It's a bloody miracle, Dropbox is. The backup feature is really second fiddle to sharing, it's just to make it useful enough for you to try it before you need to share, so that you discover sharing and fall in love with the product.
If they have a decent business plan, some well thought out contingencies, and the ability/willingness to compete, they'll be fine for a while yet.
They have specific brand momentum (where Google's momentum is not specific to the product) which counts for a lot when dealing with the general public.
I wouldn't worry like hell. Though I would worry a healthy amount: I'd keeping a very close eye on how this pans out, and would re-double efforts to make sure I didn't fall behind on product development, quality and support.
Google Video (rescued by throwing a few billion at the competitor who was running away with the space), Lively (its like IMVU except without the users), Dodgeball, Wave, Google Page Creator (its like Weebly except without the users), Orkut (debatable whether one can put it in the failure column for not being FB but it certainly isn't FB), etc, etc.
But Google 'gives everything away' (with indirect monetisation), both the products that succeed and the products that fail. So in that sense this is just a list of failed products which are the byproduct of innovation at such a scale, rather than an indication of what has worked and what has not for Google in the past. Surely in this case, going up against a competitor that needs to charge, Google would be at a massive advantage (legality aside) by not having to charge?
I agree. Just look at the way Google slowed down the incrementally increasing storage of Gmail. It's been some time but it's still lagging after they did a major "bump" some years back. There might be a lot of applause at the beginning but being able to knock Dropbox out of the game will take serious effort.
I think GDrive will help DropBox more by offloading their freeriders to Google. People seeking a better premium experience (and less risk of say losing all their GDrive contents because their Google+ got suspended) will likely find DropBox appealing once they realize the convenience of a service like this.
Since it seems to be based on Google Documents, I think Dropbox will do just fine. There are few pages on the internet that I dislike more than the Google Documents start page. I actually feel annoyed every time I look at that auto generated shit list of files that is Google documents. It breaks every user interface convention for displaying a list of files. Navigating files is something I already know how to do, but Google is special and has figured out how to make it a chore.
Google has given away lots of stuff without success. Worrying about a big competitor "crushing" you just because they announce a product is a sign of productitis. Symptoms include ignoring marketing, customer experience, and organizational focus.
Indeed. Competition on this market space is almost guaranteed to be a race to the bottom. Dropbox will have to respond by concentrating on features to set itself apart.
That headcount is part of the reason it's easier to compete with Google.
The design of the Google organization rewards micro-optimizations (use data for every decision, or else your ass isn't covered) and risk-aversion (set low KPI's and game them to get the biggest bonus each quarter).
By contrast, the design of the innovation space in general rewards peak-jumping, risk-taking, and a healthy blend of intuition and data. And it already selected Dropbox.
Don't get me wrong, the (layers and layers of) leadership at Google want to make killer products. But at the level of the lowly implementer, not only is making killer products only a peripheral concern, but those who can and want to make killer products tend to self-select out of Google.
Good example. MS successfully killed off Netscape (the company) within a few years by bundling an inferior browser. It also prevented them from entering desktop OS, which was perceived as a threat back in the day.
Edit: FYI, Mosaic was the one I had in mind, which was free.
IE4, I believe, was the first version included in the OS or came in automatically with updates. I think IE3 came in one of those internet startup kits.
"In it is day, IE was not an inferior browser. [Making little or no noise] the opposite, actually."
Putting aside the snarky remark about IE's apparent target audience, there are any number of contemporary sources which give examples of how your intended statement is factually incorrect.
Personally, I started out as a Netscape for Windows user thinking Microsoft had no chance of catching up to a competitor as nimble as Netscape. IE 1.0 was awful (basically a rebrand of an outdated Spyglass Mosaic), IE2 was a little better but still grossly inadequate, IE3 was just fine, but there was no reason to switch, and IE4 was legitimately better (in my opinion) than Netscape was at the time. (Helped by the fact that Netscape 4.x was a bloated mess.)
There is plenty of room for reasonable people to disagree, but my conversion circa IE4 was not an outlying datapoint.
I started out as a Netscape for Mac user. I stayed that way until there was a viable alternative, and that alternative was never IE, no matter how much Steve Jobs stood on stage and said he loved it.
That may be true for the Mac, but the vast majority of users were on Windows. And on Windows, IE would have won the browser wars on its own merits without Microsoft's dirty tricks. As the GP said - IE3 was better than Netscape 3 and IE4 was streets ahead. Netscape 4 was the worst release of a major browser that I've seen.
I know that it was supposed to cost money but I have never met anyone, outside of corporations, that actually paid for Navigator. My ISP included it in their software packet, my school had it readily available.
I think they were doing "free for noncommercial uses" license because most of the people I knew then I wouldn't consider a software pirate.
No, I think he's saying that MS put out a browser bundled with every windows computer sold, so that was what dominated. Now google can do something similar in leveraging its existing userbase (everyone with a google account) to drive adoption of gdrive (ala google+). You won't have to sign up for something new... it'll already be waiting for you.
FWIW, one of the reasons I like having a non Google service to hold some important files is in case I hit the Google black swan and get locked out of my gmail account. (I also backup my email regularly.) While integration would probably be convenient, I need to be able to keep working if I do get locked out.
Dropbox's situation seems extremely precarious. Most users have less than 2 GB of data. That's not lock-in, that's a few minutes of moving. I have about 15.000 high-resolution tagged photos on flickr - that's lock-in.
Simplicity and transparency (from where I'm standing) seem like the things that helped Dropbox proliferate - no fuss, just a directory that syncs, but it also means they have no way to monetize their service (they haven't made a dime from me yet) and they provide no added value.
Now, consider my case. I don't even have to remove the Dropbox client. The folder is already mirrored on my computer, when I install the next version of Ubuntu I have to explicitly add the PPA and install the proprietary Nautilus extension. If I don't do that, I can just drag the folder to another service. At some point it's easier to quit than to continue using it, which is why I predict Dropbox is fucked once Google provides the same transparent syncing with added value of its services.
Considering that DropBox is building on Amazon cloud storage (S3) and Google have their native storage arrays, I'd be very worried, as Google can offer storage much cheaper.
If you check Google services (docs, mail), you get for just $5 -> 20GB of storage for a YEAR (or for $20 -> 80GB).
DropBox takes $9.99 a MONTH for 50GB, or around $120 a YEAR!
User lock-in is powerful, but if a competitor can offer a product for a magnitude less in price, I'd be friggin' worry my posterior off.
I realise that it's not the most reliable source, but I read a rumour [1] that Apple offered $800m to acquire Dropbox and they declined. It's possible it simply wasn't enough, but perhaps they're not interested in selling.
Do you see MS putting Amazon in their critical path? I easily picture Ballmer saying NFW, but would love to hear why MS would hand such power over to Amazon.
They're not exactly mortal enemies, other than when it comes to recruiting Seattle talent. Amazon's pricing is transparent and MS would probably plan to migrate it to their own data centers like they migrated Hotmail from Unix infrastructure, and probably lots of other products.
Eh, going by the App Engine pricing nonsense, I wouldn't necessarily count on Google's current prices reflecting anything beyond "This sounds like a nice number." It's entirely possible that if people started using up more of their allocation (as they would with a Google Drive), the prices would skyrocket.
I sign up for the beta and the first thing they do is try entice me to spam social network sites about their product (that I haven't tried) in exchange for a better place in line. Pass.
Really, I'm being downvoted into troll territory? Does it help if I say I'm a paying Dropbox user? The community is definitely changing here over the years...
Hey, didn't you write a long blog post about quitting Hacker News? And changing your password to a random string of characters to avoid being lured back?
After Gdrive is out, DropBox will find it difficult to grow.
The thing about lockin might be true for existing DropBox users. But what If I am a new user and I am comparing Google and DropBox. Who do you think I will choose?
Also once google adds support to gdrive into all their existing offerings it will be difficult to compete with that.
Dropbox usage for me at least is 100% passive, it's literally just an icon in the top right that I don't click or think about.
I don't know if that holds true for any significant number of Dropbox's users but pricing and additional functionality could easily make an equivalent service more attractive for my use case.
> They've got a small bit of lock-in if you use them a lot too, the annoyance of having to upload a large amount of files to another service.
If it works the same way as Dropbox, you'd just have to move files on your local machine from one shared directory to the other. Hell I wish all services were as easy.
> They've got a product that's a joy to use, which is not something Google is known for building outside of their core competency of search.
Google is known for getting minimalism which is the most important UI element.
> the annoyance of having to upload a large amount of files to another service.
I imagine you'd just enter your Dropbox password into a migration form and have everything seamlessly pulled in. In fact, Google might even let you sync back, but Dropbox could add it easily it if not. By nature these services have to inter-operate.
It was probably a real threat to them 4.5 years ago. I can't imagine it is now. Dropbox has a large, happy fanbase that's going to keep using it and keep spreading. They're going to keep growing. They've got a small bit of lock-in if you use them a lot too, the annoyance of having to upload a large amount of files to another service. They've got a product that's a joy to use, which is not something Google is known for building outside of their core competency of search.
If I were Dropbox I'd simply view this as market validation (not that they need it at this point) more than anything else.