1 Introduction
The Business Idea
The company Dropbox was founded in 2007 by Drew Houston. He founded an online
storage possibility and service, which makes all of a user’s files accessible from any
computer or phone. If the user has installed Dropbox and created an account, any files or
folders added to his or hers Dropbox will automatically save to the website and sync to their
connected devices1. User do not have to carry around several USB sticks anymore, they
were able to simply share any device online and also share them with team project
colleagues, friends or family .
The Cloud Storage Market
When Dropbox was founded in 2007, the cloud storage market was based on a simplistic
model, where file accesses were readdressed over the Internet instead of our computer’s
hard drive2. By now it is known as the “file hosting service”, which are all cloud storage
services, online file service providers, or cyber locker3. They are all designed to host user’s
files. The global cloud storage market has grown rapidly in the last decade and is expected
to grow even more. It was valued at $21,175 million in 2015, and is expected to raise at a
CAGR of 24.8% to reach $97,415 million by 20224. More and more industries entered this
market, such as the public sector with a large customer range, the health care, retail, etc.,
which leaded to a competitive cloud storage market with several providers, e.g. Google
Drive, which was launched in 2012 and the iCloud storage, which was initially released in
2011.
As seen in Exhibit 1 of the case5, the main competitors for Dropbox in January 2009 were
box.net, eSnipe, Freepository and some more. At this time, the main difference was that not
all platforms had a business edition (paid) and a consumer edition (free), also the maximum
storage range went from 2GB (free) to 100 GB. Therefore, Dropbox started to compete with
its value proposition of its Freemium model strategy.
Today’s main competitors are Box, OneDrive, GoogleDrive, iCloud, Tresorit and some small
providers like SugarSinc or Spider Oak, which only operate in the US. Box e.g. focuses on
the business and enterprise market and represents here a competitive threat for Dropbox.
Google Drive has an advantage that every user, which uses Google as an Internet browser is
very likely using Google Drive as a storage possibility too6. Overall, the Cloud Storage
Market is very competitive and fast moving and characterized by high technology innovation,
where Dropbox competes against “top-player” companies like Google, Apple, Microsoft, Box
and Co.
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