Dropbox CEO Drew Houston recently declared, “We are replacing the hard drive.”

To illustrate his point, he even invoked a Hollywood example: “Tom Cruise in Minority Report is not carrying around a thumb drive or logging into Gmail to pick up his attachment.” Maybe so, but the actor has another famous film that describes Dropbox's end game even better: Mission Impossible. 

The Fluffy Cloud Has A Hard Metal Center

Granted, classic hard drives—specifically hard-disk drives—are an easy target. They're already on the way out, making way for solid-state drives using flash-memory chips, which have no spinning platters or other moving parts. These storage components are faster and sexier, and they're getting more affordable all the time. But Houston wasn't parsing technologies—he was referring to the whole concept of local storage, which most consumers lump together under the "hard drive" moniker. 

His confidence may be misguided, but it's not hard to see where it comes from. His company and other cloud-storage providers are arguably succeeding in obliterating another storage device—what Tina Fey's Claire in Date Night called the "computer sticky thing." (That's a USB drive or thumb drive to you and me.)

For Dropbox users, dragging and dropping files into a desktop folder that automatically syncs to the Internet is far easier than saving to a thumb drive, ejecting said drive, stashing it in a purse or pocket, and crossing your fingers that you'll remember where you put it. And for mobile users, cloud storage is a godsend. Although thumb drives still get sold, and they're getting cheaper all the time, they've already dropped out of their brief pop-culture spotlight—after just a couple of years, Date Night seems dated. 

But thumb drives were a convenience, not the primary data repository of our digital lives. There are serious flaws in Houston's premise that Dropbox is the hard drive's "spiritual successor."

First of all, Dropbox isn't replacing the hard drive, it's just moving it to a different location. Every bit of data in "the cloud" actually lives in tangible drives at some physical data center somewhere. And in the home, Dropbox still functions better with a computer's hard drive than without. 

Storage industry analyst Tom Coughlin agrees.

"There is value in both local and cloud copies of files, and Dropbox currently supports synchronization between the cloud and a computer—and thus on a local [hard drive]," he told me via email. Your Dropbox files are actually copied to your computer's local drive, allowing for offline access. Coughlin "expects they will continue to do this."

And Dropbox unveiled a new crop of coding tools earlier this month. One key feature: allowing other software developers to benefit from this same hybrid online-offline access to Dropbox files. Score another point for the local hard drive. 

Hard Truths About Cloud Storage

The fuzzy thinking around the cloud isn't peculiar to Dropbox. All cloud-focused companies have to contend with a few ongoing, universal truths: 

They Rely On The Internet

"People will always need to have files available through their hard drive for easy, secure and quick access, not to mention at those times when they can't rely on—or don't have—an Internet connection," says Vineet Jain, CEO of Egnyte, a firm that specializes in both local and cloud IT infrastructure.

Those are actually two issues—speed and access. There's simply no faster way to open a file than from your own local drive. That's especially true if you're talking about big media files. Trying to access or stream videos or music can be an exercise in frustration for Internet users suffering from dropped connections and slow speeds. And good luck with avoiding those if you live in a rural area. The Federal Communications Commission and the Commerce Department say only 40 percent of rural households have access to high-speed cable Internet service. 

They Rely On An Internet That's Capped And Throttled

Things aren't idyllic for users with home broadband and high-speed cellular networks, either. Even as fixed and wireless broadband providers are pushing us to do more and more over the Internet, they're instituting data caps and speed throttling to limit our Internet usage or at least make it more expensive. AT&T, Comcast, Time Warner Cable and Verizon are just a few of the providers who engage in these practices, and they cover a majority of the Internet and smartphone users in the U.S.

Although accessing or editing simple text documents online doesn't require hefty Internet pipes, the bandwidth load balloons when you include photo and video editing, streaming whole music libraries and movies, or accessing other types of large files. 

They're Pricey

Dropbox offers a modest 2 gigabytes of storage for free. How small is that? Forget about your music library: You can only store about 250 songs in that space. You can refer friends to get more storage, but you still won't get anywhere near a decent music library.

Sure, Dropbox is handy for quick access on mobile devices. But you know what else mobile devices do? Generate a lot of files—especially photos and videos. With cameras getting better all the time, like Nokia's crazy-good 41-megapixel model, image files just keep getting bigger. If you want to keep them and not just toss them up on Instagram, you'll need terabytes of storage, not gigabytes.

What does Dropbox cost? For its paid tiers, you can buy 100GB, 200GB and 500GB of storage for $99, $199, and $499 per year, respectively. You can buy a one-terabyte hard drive—1,000 gigabytes—for $59 now.

For Security And Privacy, They Can't Beat Your Local Drive

Allow me to state the obvious: If you want your data to be hack-proof and completely inaccessible to others, don't put it on the Internet. Period.

Many cloud-storage companies use external data centers, and that can be a dicey security issue. Although Dropbox encrypts user data, it winds up on Amazon's S3 servers.

The biggest obstacle to Houston's push to the cloud may be public distrust, thanks to the U.S. National Security Agency's controversial PRISM surveillance program. Dropbox was listed alongside tech giants like Google and Microsoft as companies cooperating with government data requests. Dropbox says it has "a small number of employees who must be able to access user data for the reasons stated in our privacy policy (e.g., when legally required to do so)."

Houston, We Have A Problem

Dropbox is a useful service, especially for sharing the occasional file. For groups of people working together, Dropbox may be a smarter solution than hard-to-maintain file servers. But replacing the hard drive as the ultimate stash for ordinary consumers' personal files? That goes way too far.

Drew Houston isn't the first tech exec to make bold, outlandish marketing claims. Salesforce.com CEO Marc Benioff launched his software company, which rents software over the Internet, with the rallying cry "The end of software!" The truth is, Salesforce makes money selling software in a slightly different way than companies used to sell it. 

And Dropbox isn't replacing hard drives as much as tweaking the way we use them, so we get more out of them. (See Salesforce heralding its enterprise cloud services as "The End of Software.") But it's clear his lofty fantasy doesn't square with the realities of today's Internet. And until it does, Dropbox has an impossible mission on its hands. 

Feature image courtesy of Flickr user Jeff Kubina