17 ms·

Dropbox and Uber: Worth Billions, But Still Inches From Disaster

97 points by dkoch 13y ago

caruber 13y ago
The real strength of Dropbox comes from the ecosystem of apps that use dropbox to store data. It is hard for newcomers to challenge that network effect. But competitors like Tonido are doing interesting stuff by focusing on the security, privacy and the private aspects of owning your own cloud. If they are able to change the narrative from utility to trust and security then newcomers have a fighting chance. Finally it comes to what wins the customers: Trust or Utility or the Balanced of Both.
- minimaxir 13y ago
  Out of curiosity, how many new apps use the Dropbox API, or the new Data Storage API? I haven't heard much on that front.
  - clarky07 13y ago
    I have no idea how many use it, but I've implemented it in one of my apps and it is pretty fantastic. I plan to use it in more in the future.
    - daniel_levine 13y ago
      let us know if we can help!
    - dunham 13y ago
      Does it work offline at all? I took a brief look at the API, and it seemed like any time you wanted to make a change to the data it needed to talk to the server.
      - clarky07 13y ago
        It makes the changes locally, and then syncs when you get a connection later.
- lotso 13y ago
  Which apps are using Dropbox to store data?
  - caruber 13y ago
    ASFAIK 1Password, GoodReader, BoxyTunes, QuickOffice and tons of file managers in Android
  - sp332 13y ago
    caruber answered your question, but for some reason the answer is dead. ASFAIK 1Password, GoodReader, BoxyTunes, QuickOffice and tons of file managers in Android
  - simonw 13y ago
    Tons of mobile apps do this. 1password is probably the best example, but just the other day I decided I wanted to be able to view a Sketchup file on my phone and the app I found ( https://itunes.apple.com/us/app/sightspace-free-d/id567219670?mt=8 https://itunes.apple.com/us/app/sightspace-free-d/id56721967... ) had the option to load files from Dropbox.
  - clarky07 13y ago
    I have it in several of my apps, Lister 2 and Ez Budget. It's fantastic for syncing over multiple devices.
  - CJefferson 13y ago
    My comic book reader uses Dropbox to sync, my todo program uses Dropbox to read my todo.txt, I use Dropsync to do 2-way syncing between a directory on my phone and my computers mainly so I can drop reciepts + other PDFs into a directory on my computer and get them from my phone, tablet or other PCs. I could go and replace all of these with another tool, but I would have to have a compelling reason to do so and would probably have to find some new apps (or the apps I use would have to integrate a new service)
snowwrestler 13y ago
The ease with which customers can or will migrate from one service to another is greatly exaggerated by this article, and many many other articles like it. Look at web search--it's no harder to type www.bing.com instead of www.google.com (it's actually 2 letters easier), and for most common searches, the results will be exactly the same. "What time does the Super Bowl start". "Facebook login".[1] And yet, Bing has not significantly dented Google's web search market share despite $billions of investment in technology, advertising, incentive plans, etc. > If Dropbox accidentally destroyed just one person’s file, he said, it could erode the trust of all its users. Ha! Dropbox destroys user files against the will of users all the time--it's inherent in the concept of a syncing service, and why we warn each other, "Dropbox is not a backup service." And if you're thinking of just straight-up data corruption or loss, look at Evernote, which does that on a regular basis yet continues to grow. There's nothing more to this story than the fundamental threats that face any business in any industry: if you fail to please your customers, you leave the door open for competitors. But, that doesn't mean there is no margin for error. Or even a small margin for error. [1] http://searchenginewatch.com/article/2051199/Facebook-Login-Fiasco-Demonstrates-Challenge-in-Competing-with-Google http://searchenginewatch.com/article/2051199/Facebook-Login-...
- mbesto 13y ago
  Someone mentioned a comment like this before on HN. Basically saying the only threat to businesses like Google Search, Dropbox, Evernote, etc. are if someone comes in and does it 10x better. That's the only fragility I see.
  - Silhouette 13y ago
    someone comes in and does it 10x better That was the rule of thumb I heard quoted in Business Studies, too. I think the key point was that a customer base tends to have a lot of inertia. To overcome that, you need at least one element of your competing offer to be dramatically better, and for quantifiable things like a price, an order of magnitude is significant enough to achieve that (and by implication a factor of only say 2x or 3x wouldn't necessarily be enough to dislodge an established brand). Clearly there's a lot more to market dynamics than that in practice. On the one hand, we have supermarkets competing over prices for commodity household products by the penny/cent. On the other hand, at least here in the UK, we have industries like mobile phones, personal banking and household utilities that are all notorious for having poor customer service yet also all have surprisingly low numbers of customers switching brand. I'm not sure where on that scale a typical consumer Internet service would fall, but in all cases it seems highly unlikely that a service with an inherent element of lock-in (even if you can move your data, it's going to take time and effort to do it) has anything to fear from an occasional screw-up that affects a few customers. It's obviously undesirable, and hopefully none of us thinks it's OK to dismiss anything that damages any paying customer out of hand, but it's not some sort of doomsday scenario that is going to bring down a whole company overnight.
spodek 13y ago
Startups tend to be halfway between taking over the world and bankruptcy. That's why we love them and founders sleep on floors.
- vikrum 13y ago
  I'd go so far as to say all companies balance this act. A company can implode at any stage of its life. See: Nokia, Blackberry, etc.
  - cpach 13y ago
    Good point. But for example, in 2007 I’d say Blackberry were miles and not inches from death. They could probably have steered in another direction.
- drp4929 13y ago
  With billion dollar valuations these are not startups rather corporate giants.
  - adventured 13y ago
    Obviously not inherently true, and in no way tied to valuation. Instagram, as one easy example, had a billion dollar valuation with three dozen employees and was anything but a corporate giant.
- sgustard 13y ago
  "Only the Paranoid Survive" - Andy Grove. The best-managed companies maintain this attitude rather than getting complacent.
- onedev 13y ago
  Yeah, come on people Dropbox and Square are far from "startups". With hundreds of employees and billion dollar valuations...
primitive_type 13y ago
As a frequent Uber user in Chicago, I can attest to the fact that Uber often has no available rides for me when I need one. Just this past weekend at a rather busy intersection in Chicago, after requesting both an UberX and regular Uber taxi multiple times, I kept getting texts from Uber saying "we can't find an Uber for you at this time. Sorry for the inconvenience. Please try again soon!" So the article's suggestion that "customers opening up the app and seeing no rides on the map" would be an existential threat to Uber is currently being proven wrong by Uber's success. That happens all the time and Uber is still doing alright.
- ankitml 13y ago
  they are trying hard to avoid that by surge pricing. Imagine the frequency of such unavailability in case of flat pricing. I am sure that would be an existential threat.
- enobrev 13y ago
  While in Chicago over the holiday I tried out an app called Hailo to get yellow cabs on 3 separate occasions when none were to be found. I both enjoyed and recommend the app (with which I've no affiliation). Not sure if you'd get the same response as uber taxi. Some of the hailo drivers also had the uber app running somewhere on their dash and some did not.
rmc 13y ago
The ignorance and arrogance of Uber about the French union situtation is mindbogglying: > This is also why Uber believes it can’t compromise once it begins to offer its services in a new city, or a new country, like France. It strives to work with regulators to accommodate its existing service rather than changing how it works. It's not the regulators/government that are a problem, it's the taxi unions. You're talking about a place with a very strong, and very long history of active union activity. "We can't compromise on service". "Fine, we'll drag your drivers out of their cars and set the cars on fire. Your move."
- at-fates-hands 13y ago
  Agreed. Kind of hard to get a business off the ground when Unions control everything and free enterprise is essentially suffocated out of the country. The ironic part of the Uber story was the Taxi Union complaining about "unfair practices".
  - sentenza 13y ago
    Wait a minute... Last time I checked, France was still a quite functional first world economy, independent of recent attempt by certain press outlets to place it near every ideological precipice you can think of (I'm looking at you, The Economist). Taxi drivers have higher costs than Uber drivers because of two reasons: Firstly, they must comply with lots of regulations that are specific to taxis and the driving thereof. Secondly, they are unionized, thus keeping the taxi rates from dropping too low. Both points deserve to be debated and none of them is a no-brainer in favor of Uber. Especially regarding the regulation issue, I personally am not inclined to sympathize with Uber. Most of that regulation is there for a reason.
    - streetnigga 13y ago
      Avoid regulations that exist for a reason (Uber), tout profits as why those who comply are failing, cry about free market when the language of the law catches up reducing profit margins.
    - 13y ago
adventured 13y ago
"Dropbox is not diversified" How diversified was Google in its first ten years? Ads and desktop search overwhelmingly ruled. How diversified is Facebook? How diversified is Twitter? How diversified is Apple? (with the iPhone generating 75% of their profit) This tends to apply to almost any big company in its formative years. They get big because they put all their wood behind a killer arrow that made all the rest possible. That's not to say Dropbox will have that future, but rather that criticizing them for not diversifying at this point is a low quality criticism.
- patrickk 13y ago
  Exactly. Any company has to be focused on executing one thing well for several years into it's life if they want to succeed at all. The article struck me as being very poorly written for this reason. As if offering some generic web widget will help Dropbox diversify and survive if users lose faith in their syncing product. If the author knew anything about startups he wouldn't have made this the central point of this piece.
- deleted 13y ago
  [deleted]
adventured 13y ago
"Uber could make the recent complaints go away fairly quickly. It could drop surge pricing. And it could acquiesce and change its service in cities where government and industry have come out against it." This is false. If Uber gives an inch, their competitors will go for the kill and move on to targeting the jugular. What they want is for Uber to not exist, and for there to be no new competitor or revolution in their business. There is no way to appease their competitors that results in Uber surviving as a useful service. What Uber's competitors want is very simple: 1) they want to not have to compete with any innovation; 2) they do not want to have to change or improve their services; 3) they want no new, fast growing entrants allowed in their markets Basically what they want is a frozen, guaranteed market with zero market forces. That's why their response is: violence, regulations, political leverage, etc (anything but innovation or actually competing with Uber).
john_b 13y ago
> If Dropbox accidentally destroyed just one person’s file, he said, it could erode the trust of all its users. “This is like the same sort of genre of problem as the code that you use to fly an airplane. Even if it’s a little bug, it’s a big problem.” As someone who writes code for jet engines, I find this perspective laughable. A better analogy would be if an automated baggage handling system lost your bag. You'd lose your stuff and the airline would lose your trust. You might rant about it on a blog and a few people would get upset and switch airlines with you. But nobody dies.
levlandau 13y ago
If all startups face the same problem then the strongest startup wins. Simply naming a risk that all startups face and then saying the strongest startups in their respective domains are more at risk isn't really cutting it for me. If there's anyone that would figure out how to store my files in the cloud reliably it's probably dropbox and if there's anyone that's going to solve the math, science and cs problem of moving cars around...it's probably uber and not lyft or any of the other competitors. For now, their $ Billion valuations are safe and sound.
philrapo 13y ago
The alternatives are either running your own service or switching to a dropbox competitor. Even at huge companies with resources dedicated towards IT infrastructure, systems still go down with regularity. Dropbox is probably still more reliable than what many large companies use.
fit2rule 13y ago
I've personally never found Dropbox to be what I want in a file-sharing device. Ultimately, I think its really a shame that the OS vendors haven't made 'cloud-based auto-discovery and user-control over publication' a major feature of their OS. The reason we need/want/love Dropbox is simply that the mainstream OS vendors dropped the ball, imho, and got lured away into Web2.0 land when they should simply have been adding these features - a distributed, cloud-based networked filesystem - directly to the OS. Why do I need another custom extension for this, from an unknown startup, when it could as easily be implemented as an OS feature? I think the reason is, the vendors are asleep at the wheel. I've enjoyed the process of setting up my own cloud services for things like filesharing, using whatever tools I can .. but I sure wish it were just something to 'turn on' in OSX or Ubuntu, or whatever .. without requiring a third-party involvement (Ubuntu One or iCloud = no thanks!). So I see Dropbox's future as being pretty cloudy, personally. I think the repercussions for American cloud providers, especially, are coming .. the desire for a private cloud is a big itch.

97 points by dkoch 13y ago

The real strength of Dropbox comes from the ecosystem of apps that use dropbox to store data. It is hard for newcomers to challenge that network effect. But competitors like Tonido are doing interesting stuff by focusing on the security, privacy and the private aspects of owning your own cloud. If they are able to change the narrative from utility to trust and security then newcomers have a fighting chance. Finally it comes to what wins the customers: Trust or Utility or the Balanced of Both.

minimaxir 13y ago
Out of curiosity, how many new apps use the Dropbox API, or the new Data Storage API? I haven't heard much on that front.
- clarky07 13y ago
  I have no idea how many use it, but I've implemented it in one of my apps and it is pretty fantastic. I plan to use it in more in the future.
  - daniel_levine 13y ago
    let us know if we can help!
  - dunham 13y ago
    Does it work offline at all? I took a brief look at the API, and it seemed like any time you wanted to make a change to the data it needed to talk to the server.
    - clarky07 13y ago
      It makes the changes locally, and then syncs when you get a connection later.
lotso 13y ago
Which apps are using Dropbox to store data?
- caruber 13y ago
  ASFAIK 1Password, GoodReader, BoxyTunes, QuickOffice and tons of file managers in Android
- sp332 13y ago
  caruber answered your question, but for some reason the answer is dead. ASFAIK 1Password, GoodReader, BoxyTunes, QuickOffice and tons of file managers in Android
- simonw 13y ago
  Tons of mobile apps do this. 1password is probably the best example, but just the other day I decided I wanted to be able to view a Sketchup file on my phone and the app I found ( https://itunes.apple.com/us/app/sightspace-free-d/id567219670?mt=8 https://itunes.apple.com/us/app/sightspace-free-d/id56721967... ) had the option to load files from Dropbox.
- clarky07 13y ago
  I have it in several of my apps, Lister 2 and Ez Budget. It's fantastic for syncing over multiple devices.
- CJefferson 13y ago
  My comic book reader uses Dropbox to sync, my todo program uses Dropbox to read my todo.txt, I use Dropsync to do 2-way syncing between a directory on my phone and my computers mainly so I can drop reciepts + other PDFs into a directory on my computer and get them from my phone, tablet or other PCs. I could go and replace all of these with another tool, but I would have to have a compelling reason to do so and would probably have to find some new apps (or the apps I use would have to integrate a new service)

snowwrestler 13y ago

The ease with which customers can or will migrate from one service to another is greatly exaggerated by this article, and many many other articles like it. Look at web search--it's no harder to type www.bing.com instead of www.google.com (it's actually 2 letters easier), and for most common searches, the results will be exactly the same. "What time does the Super Bowl start". "Facebook login".[1] And yet, Bing has not significantly dented Google's web search market share despite $billions of investment in technology, advertising, incentive plans, etc. > If Dropbox accidentally destroyed just one person’s file, he said, it could erode the trust of all its users. Ha! Dropbox destroys user files against the will of users all the time--it's inherent in the concept of a syncing service, and why we warn each other, "Dropbox is not a backup service." And if you're thinking of just straight-up data corruption or loss, look at Evernote, which does that on a regular basis yet continues to grow. There's nothing more to this story than the fundamental threats that face any business in any industry: if you fail to please your customers, you leave the door open for competitors. But, that doesn't mean there is no margin for error. Or even a small margin for error. [1] http://searchenginewatch.com/article/2051199/Facebook-Login-Fiasco-Demonstrates-Challenge-in-Competing-with-Google http://searchenginewatch.com/article/2051199/Facebook-Login-...

mbesto 13y ago
Someone mentioned a comment like this before on HN. Basically saying the only threat to businesses like Google Search, Dropbox, Evernote, etc. are if someone comes in and does it 10x better. That's the only fragility I see.
- Silhouette 13y ago
  someone comes in and does it 10x better That was the rule of thumb I heard quoted in Business Studies, too. I think the key point was that a customer base tends to have a lot of inertia. To overcome that, you need at least one element of your competing offer to be dramatically better, and for quantifiable things like a price, an order of magnitude is significant enough to achieve that (and by implication a factor of only say 2x or 3x wouldn't necessarily be enough to dislodge an established brand). Clearly there's a lot more to market dynamics than that in practice. On the one hand, we have supermarkets competing over prices for commodity household products by the penny/cent. On the other hand, at least here in the UK, we have industries like mobile phones, personal banking and household utilities that are all notorious for having poor customer service yet also all have surprisingly low numbers of customers switching brand. I'm not sure where on that scale a typical consumer Internet service would fall, but in all cases it seems highly unlikely that a service with an inherent element of lock-in (even if you can move your data, it's going to take time and effort to do it) has anything to fear from an occasional screw-up that affects a few customers. It's obviously undesirable, and hopefully none of us thinks it's OK to dismiss anything that damages any paying customer out of hand, but it's not some sort of doomsday scenario that is going to bring down a whole company overnight.

spodek 13y ago

Startups tend to be halfway between taking over the world and bankruptcy. That's why we love them and founders sleep on floors.

vikrum 13y ago
I'd go so far as to say all companies balance this act. A company can implode at any stage of its life. See: Nokia, Blackberry, etc.
- cpach 13y ago
  Good point. But for example, in 2007 I’d say Blackberry were miles and not inches from death. They could probably have steered in another direction.
drp4929 13y ago
With billion dollar valuations these are not startups rather corporate giants.
- adventured 13y ago
  Obviously not inherently true, and in no way tied to valuation. Instagram, as one easy example, had a billion dollar valuation with three dozen employees and was anything but a corporate giant.
sgustard 13y ago
"Only the Paranoid Survive" - Andy Grove. The best-managed companies maintain this attitude rather than getting complacent.
onedev 13y ago
Yeah, come on people Dropbox and Square are far from "startups". With hundreds of employees and billion dollar valuations...

primitive_type 13y ago

As a frequent Uber user in Chicago, I can attest to the fact that Uber often has no available rides for me when I need one. Just this past weekend at a rather busy intersection in Chicago, after requesting both an UberX and regular Uber taxi multiple times, I kept getting texts from Uber saying "we can't find an Uber for you at this time. Sorry for the inconvenience. Please try again soon!" So the article's suggestion that "customers opening up the app and seeing no rides on the map" would be an existential threat to Uber is currently being proven wrong by Uber's success. That happens all the time and Uber is still doing alright.

ankitml 13y ago
they are trying hard to avoid that by surge pricing. Imagine the frequency of such unavailability in case of flat pricing. I am sure that would be an existential threat.
enobrev 13y ago
While in Chicago over the holiday I tried out an app called Hailo to get yellow cabs on 3 separate occasions when none were to be found. I both enjoyed and recommend the app (with which I've no affiliation). Not sure if you'd get the same response as uber taxi. Some of the hailo drivers also had the uber app running somewhere on their dash and some did not.

rmc 13y ago

The ignorance and arrogance of Uber about the French union situtation is mindbogglying: > This is also why Uber believes it can’t compromise once it begins to offer its services in a new city, or a new country, like France. It strives to work with regulators to accommodate its existing service rather than changing how it works. It's not the regulators/government that are a problem, it's the taxi unions. You're talking about a place with a very strong, and very long history of active union activity. "We can't compromise on service". "Fine, we'll drag your drivers out of their cars and set the cars on fire. Your move."

at-fates-hands 13y ago
Agreed. Kind of hard to get a business off the ground when Unions control everything and free enterprise is essentially suffocated out of the country. The ironic part of the Uber story was the Taxi Union complaining about "unfair practices".
- sentenza 13y ago
  Wait a minute... Last time I checked, France was still a quite functional first world economy, independent of recent attempt by certain press outlets to place it near every ideological precipice you can think of (I'm looking at you, The Economist). Taxi drivers have higher costs than Uber drivers because of two reasons: Firstly, they must comply with lots of regulations that are specific to taxis and the driving thereof. Secondly, they are unionized, thus keeping the taxi rates from dropping too low. Both points deserve to be debated and none of them is a no-brainer in favor of Uber. Especially regarding the regulation issue, I personally am not inclined to sympathize with Uber. Most of that regulation is there for a reason.
  - streetnigga 13y ago
    Avoid regulations that exist for a reason (Uber), tout profits as why those who comply are failing, cry about free market when the language of the law catches up reducing profit margins.
  - 13y ago

adventured 13y ago

"Dropbox is not diversified" How diversified was Google in its first ten years? Ads and desktop search overwhelmingly ruled. How diversified is Facebook? How diversified is Twitter? How diversified is Apple? (with the iPhone generating 75% of their profit) This tends to apply to almost any big company in its formative years. They get big because they put all their wood behind a killer arrow that made all the rest possible. That's not to say Dropbox will have that future, but rather that criticizing them for not diversifying at this point is a low quality criticism.

patrickk 13y ago
Exactly. Any company has to be focused on executing one thing well for several years into it's life if they want to succeed at all. The article struck me as being very poorly written for this reason. As if offering some generic web widget will help Dropbox diversify and survive if users lose faith in their syncing product. If the author knew anything about startups he wouldn't have made this the central point of this piece.
deleted 13y ago
[deleted]

adventured 13y ago

"Uber could make the recent complaints go away fairly quickly. It could drop surge pricing. And it could acquiesce and change its service in cities where government and industry have come out against it." This is false. If Uber gives an inch, their competitors will go for the kill and move on to targeting the jugular. What they want is for Uber to not exist, and for there to be no new competitor or revolution in their business. There is no way to appease their competitors that results in Uber surviving as a useful service. What Uber's competitors want is very simple: 1) they want to not have to compete with any innovation; 2) they do not want to have to change or improve their services; 3) they want no new, fast growing entrants allowed in their markets Basically what they want is a frozen, guaranteed market with zero market forces. That's why their response is: violence, regulations, political leverage, etc (anything but innovation or actually competing with Uber).

john_b 13y ago

> If Dropbox accidentally destroyed just one person’s file, he said, it could erode the trust of all its users. “This is like the same sort of genre of problem as the code that you use to fly an airplane. Even if it’s a little bug, it’s a big problem.” As someone who writes code for jet engines, I find this perspective laughable. A better analogy would be if an automated baggage handling system lost your bag. You'd lose your stuff and the airline would lose your trust. You might rant about it on a blog and a few people would get upset and switch airlines with you. But nobody dies.

levlandau 13y ago

If all startups face the same problem then the strongest startup wins. Simply naming a risk that all startups face and then saying the strongest startups in their respective domains are more at risk isn't really cutting it for me. If there's anyone that would figure out how to store my files in the cloud reliably it's probably dropbox and if there's anyone that's going to solve the math, science and cs problem of moving cars around...it's probably uber and not lyft or any of the other competitors. For now, their $ Billion valuations are safe and sound.

philrapo 13y ago

The alternatives are either running your own service or switching to a dropbox competitor. Even at huge companies with resources dedicated towards IT infrastructure, systems still go down with regularity. Dropbox is probably still more reliable than what many large companies use.

fit2rule 13y ago

I've personally never found Dropbox to be what I want in a file-sharing device. Ultimately, I think its really a shame that the OS vendors haven't made 'cloud-based auto-discovery and user-control over publication' a major feature of their OS. The reason we need/want/love Dropbox is simply that the mainstream OS vendors dropped the ball, imho, and got lured away into Web2.0 land when they should simply have been adding these features - a distributed, cloud-based networked filesystem - directly to the OS. Why do I need another custom extension for this, from an unknown startup, when it could as easily be implemented as an OS feature? I think the reason is, the vendors are asleep at the wheel. I've enjoyed the process of setting up my own cloud services for things like filesharing, using whatever tools I can .. but I sure wish it were just something to 'turn on' in OSX or Ubuntu, or whatever .. without requiring a third-party involvement (Ubuntu One or iCloud = no thanks!). So I see Dropbox's future as being pretty cloudy, personally. I think the repercussions for American cloud providers, especially, are coming .. the desire for a private cloud is a big itch.