Dropbox Makes Another Nod Toward Business, But It Might Not Be Enough Yet

Dropbox announced several updates to its Dropbox for Business product today that are designed to make it more attractive to IT pros who will administer the service in the enterprise. That said, not all are convinced that the company has gone far enough perfect its offering to larger businesses.

R Ray Wang, founder at Constellation Research says today’s announcements are a good first step, but that Dropbox still has a long way to go in terms of appealing to larger business customers. “Remote wipe, account transfer, and audit logs are a good step in the right direction.” he told me.

But, he added, “While Dropbox is working hard to become enterprise class, it’s not something you do overnight. Security is one [aspect], but enterprise class integration, identity management, carrying context, encryption of content, tying back to the [content management system] are some features that are needed to get there,” Wang told me.

Dropbox for Business does offer at-rest and in-transit encryption, it’s worth noting.

Lawrence Hawes, principal at Dow Brook Advisory Services, and who follows online collaboration said that despite the new features, Dropbox still has a serious perception problem with IT pros inside the enterprise, and a few new bells and whistles isn’t likely to change that.

“Today’s announced improvements to Dropbox for Business do little to overcome the realities and perception that Dropbox is not ready for the enterprise. The memories of well-documented incidents of security and privacy breaches of the Dropbox service, as well as its too-frequent service outages, are still fresh in the minds of those charged with buying secure, reliable IT for their companies. While some may give Dropbox for Business a first (or another) look based on the new features launched today, most corporate IT departments and buyers will continue to seek other alternatives,” Hawes wrote to me in email.

Wang sees a battle playing out over the next 36 months in which Box, Egnyte, Dropbox and other players including Microsoft and its Office 365/One Drive, not to mention Google Drive, will be fighting for the hearts and minds of the enterprise users and their IT administrators.

For now, Box and Egnyte remain the players to beat in this space in Wang’s view. From his perspective, the fight isn’t just about the back end where IT lives and breathes, but also the front end where users work — ease of use and enabling new ways of working are important factors there.

It’s worth noting that Dropbox is a pure cloud play while Egnyte offers a hybrid on-premises/cloud solution.

As Dropbox takes aim at Box, which recently announced its coming IPO, Hawes says it would be wise to remember the lessons Box has learned over the last couple of years when it comes to selling to the enterprise. “As Box has discovered over the last two years, large, complex organizations require far more in the way of administration capabilities that help to ensure information security. Dropbox remains far behind Box, and even further behind [file sync and share] providers that have designed and built their products for enterprises from the beginning, in their ability to attract and effectively serve business customers.”

So while Dropbox added some much-needed administrative functionality with today’s announcement, they still have a long journey ahead of them to reach enterprise respectability.

Still, it’s worth remembering that Dropbox claims 4 million businesses. What it’s offering works for some, and given the relative youth of its business offering, it’s not surprising that it’s taking the time to mature to a fully featured enterprise service.

This leads us to the following question: what will Dropbox’s cadence be to expand its enterprise offerings? If it moves expeditiously, it could close any gap — perceived or otherwise — quickly. And momentum matters here: Perceived gaps in capability are less onerous when they are not expected to be long term issues.

Alex Wilhelm contributed to this report.