Dropbox CEO Drew Houston, long cast in the role of upstart, found himself in the odd position of defending the technological status quo.
At the TechCrunch Disrupt conference in San Francisco Monday, TechCrunch editor-in-chief Matthew Panzarino asked Houston if Dropbox was poised to thrive in a world where conversations are replacing files.
File This Away With Your Faxes
Dropbox, in essence, replaces your laptop’s local file system with a file system in the cloud. But on mobile devices, we generally don’t worry about arranging files in folders. Instead, we accomplish tasks with apps, which abstract away the idea of files.
“We’re a company that embraces new ways of doing business—we still have a fax machine,” Houston said.
Houston’s point was that technology accrues in sedimentary layers. The new layers over the old. For tax forms, real-estate transactions, and other obscure bureaucratic processes, you still need to fax.
A concrete example of that in-with-the-old strategy is Dropbox’s increasing integration with Microsoft Office, including a “badge” feature it rolled out last week which lets you see who’s editing a Word, Excel, or PowerPoint file and allows you to update to the latest version.
The risk to Dropbox is that it gets left behind as people increasingly move past files. Think of a Zendesk ticket, an Evernote note, or a Quip chat thread. In August, technology entrepreneur Alex Danco predicted that Dropbox might “die at the hands of Slack,” as workers solve problems by communicating, not creating documents.
Free To Share With You And Me
A few hours before Houston took the stage, Dropbox announced new team-collaboration features, centered around the idea of a shared team folder—there’s that old file-system metaphor again.
Notably, Dropbox made a feature that lets users link personal and business accounts, previously reserved for paying business customers, available to free Dropbox Basic users.
That seems to me like a move made out of weakness, not strength. Slack and many other workplace tools have free versions that allow teams to get started using the service—and then lock those teams in to paid versions later, a strategy often called “freemium,” short for “free plus premium.”
Dropbox Basic is free, of course—a way to get people hooked on storing their files online. But Dropbox hasn’t had a free version of its business service. That—and not the details of the team feature—seems to be what’s key about the new announcement. Dropbox, for better or worse, now has to give something away to draw in new business customers.
Otherwise, it risks being the next fax machine—something you have to keep around, but not a tool you love.
Photo by Matt Jiggins