Start-ups Dropbox and Box reach for the cloud
SAN FRANCISCO -- They are polar opposites, but two of Silicon Valley's hottest start-ups share similar names, market, adversaries and ambitions — perhaps with wishful eyes on going public next year.
Privately held Box and Dropbox are competing for a slice of personal cloud storage computing, a solution to the growth of Internet-connected mobile devices such as smartphones and tablets and the rise of storing files online so that consumers and businesses can retrieve data from anywhere they are on any device they choose.
"We want to create the next great enterprise-software company," says Aaron Levie, the voluble, energetic CEO of Box. "We're going after (Microsoft's) SharePoint."
Dropbox CEO Drew Houston is more laconic. His goal is to create an engineered product that is as "delightful" to consumers as anything from Apple and Facebook. "We see ourselves as building the Internet's file system," says the soft-spoken Houston.
Box has a gong and cow bell to celebrate big sales wins and new hires. At Dropbox, it's a firm handshake and a congenial smile, as engineers toil deep into the night to get just the right user experience.
It's no surprise that both companies will be at the South by Southwest Interactive (SXSWi) conference in Austin next week, vying for attention and trying to create buzz at one of the biggest technology gathering's of the year. They'll need to, considering both are competing with a who's who of tech giants in the multibillion-dollar market for personal cloud storage. Houston is scheduled to speak; Box is hosting an event with start-ups.
Dropbox and Box offer contrasting styles, and vastly different approaches as they attack opposite ends of the same market. Both have ruled out acquisitions despite overtures from heavy hitters Apple, Google and others.
Their challenges spotlight the high stakes of competing in the estimated $1.4 billion personal cloud storage market in the U.S. Forrester Research projects the market will climb to $5.8 billion by 2016.
Indeed, 90% of Corporate America expects to use the technology within three years, says a new report from The Economist Intelligence Unit and IBM.
"There are so many players, it underscores the notion that the personal cloud is replacing the personal computer as the hub in our digital lives. It is a brave new world," says Michael Gartenberg, an analyst at Gartner.
"Both are forces to be reckoned with," says Bob Davis, the former CEO of Lycos and now a general partner at Highland Capital Partners. "Dropbox has a lot of money invested in it. But when you talk about Apple, Google and Amazon as its competitors, that is a market full of 800-pound gorillas."
Crowded in the consumer market
A battle royal is shaping up at the consumer end, where Dropbox has made an immediate impact with its so-called file-synchronization capability. Lingering in the background is Google and its long-rumored storage service, called Drive. Google declined to comment on if or when Drive might launch. But analysts speculate that Drive would let people store photos, documents and videos on Google's servers so that they could be accessible from any Web-connected device and easily shared with others. If you wanted to e-mail a video shot from a smartphone, for instance, you could upload it to the Web through a Drive mobile app and e-mail a link to the video rather than a bulky file.
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