Dropbox Tweaks Consumerization Model

Post By:  MICHAEL HICKINS

Dropbox Inc., the online file sharing and storage company, is gunning more than ever for the business market. The company closed on a $250 million funding round valuing it at close to $10 billion. Dropbox is incredibly popular with consumers – it claims a whopping 200 million users – and, as it turns out, is also successfully making its way into the business market, claiming 4 million businesses and 97% of the Fortune 500, according to Ilya Fushman, the company’s head of product for enterprise and mobile. “A lot of investment is going into Dropbox for Business,” including a new feature introduced last week to a limited number of customers that allows users to maintain two distinct accounts, Mr. Fushman told CIO Journal during a telephone interview Wednesday. The feature lets users keep personal and business data separate.

Consumer applications like Dropbox, which store corporate information in remote data centers those companies don’t control, have given CIOs pause, but the company has been working to clear many of those hurdles. Even highly regulated companies are allowing employees to use Dropbox for certain purposes because it’s easier for CIOs to adopt it than try to choke it off. Rob Koplowitz, an analyst with Forrester Research Inc., tells CIO Journal “shutting it down is very difficult for the CIO to justify” because “sharing is a very compelling business functionality.”

Don Callahan, who runs operations and technology for Citigroup Inc., says he tries to use cloud technologies like Dropbox in areas of the bank’s operations that aren’t regulated. “If it makes sense, then we will” make use of it, he said during an interview at Citi headquarters in New York last month. But Mr. Callahan noted that the bank has no plans to put customer data in a cloud service such as Dropbox.

Marty Lippert, the CIO of insurance firm Metlife Inc., says employees have to request authorization to use Dropbox for work purposes, and that permission is granted “on an exception basis.”

Before even considering granting permission, Mr. Lippert says Metlife puts cloud services through strict reviews. “When we use these types of services from an enterprise perspective, we do fairly extensive security reviews from the perspective of how the vendor is operating the service, and often times look for SAS70-type reviews by a third party that can go in and do an assessment of the security infrastructure that was built around the service.” He said Metlife also looks at how the cloud service is designed to manage peaks in demand.

Joseph Schmitt, CIO of Pitney Bowes Inc., says employees, especially salespeople, are demanding applications with “the same look and feel and ease of use that they have at home.” He says Pitney Bowes is now allowing them to use Dropbox, but is still struggling to find the right balance “between enabling employee productivity and security.”

He said PBI works to educate employees about security and intellectual property issues “and sign our security policies on a yearly basis.” The company also has a steering committee that reviews privacy issues.

Mr. Fushman says Dropbox for Business allows employees to maintain two distinct accounts, which means their corporate access can be revoked without affecting their personal data; companies can also reassign their accounts to other employees, remotely wipe corporate data, and perform audits of how data has been shared. But the twin accounts means employees can still walk away with their dignity – and data – intact. “It is fundamental for us to offer a continuity of experience to our customers,” he said.

How times have changed. “At first, it was the devil,” says Cynthia Weaver, who as assistant vice president of information technology is the highest ranking technology executive at privately held Walbridge, a Detroit, Mich.-based construction company with 2011 sales of over $1.1 billion. She says the company “heavily discouraged” employees from using Dropbox because it was easy for them to put proprietary data “outside the corporate structure.”

However, she says steps taken by the company to take corporate IT needs into account, make her “more interested in having that conversation with them.”

Ross Piper, vice president of enterprise strategy for Dropbox, says the company is trying to meet as many CIOs as it can “to make sure we’re building things the right way.”

The company has added a number of features making it easier for developers to incorporate new applications into the Dropbox ecosystem. Mr. Piper said Dropbox is adding new features making it easier for people to share documents – which is what makes the application popular with consumers – as well as in ways to make corporate IT departments happy. “We need to continue to invest in security features, administrative controls and console, and integration with other systems.”

Dropbox is far from alone in this area, and is sometimes confused with another cloud based storage and sharing company with a similar name, Box Inc. But Whitney Bouck, general manager of enterprise sales for Box, doesn’t see the two companies as competing fiercely for the same audience. “I see a peaceful coexistence with Dropbox,” she says. She says Dropbox has “anchored themselves with consumers better than anybody,” but that Dropbox lags behind Box when it comes to auditing and security aspects. “We’re dominating in our respective areas,” she said.

Howsoever friendly as that might be, Dropbox is hardly ready to cede the enterprise market to Box.

The cloud storage market is indeed crowded with both startups and legacy vendors.  “[Dropbox isn’t] the only game in town,” says Mr. Koplowitz, “but they have managed to work their way into a large number of enterprise short lists in very short order.”

CORRECTION: Dropbox launched a new feature last week to a limited number of customers that allows users to maintain two distinct accounts, which they can use to keep personal and business data separate. An earlier version of this article incorrectly stated that Dropbox for Business was introduced last week.

(This Article was Originally Published in Wall Street Journal- You Can Access Original source of Content Here.. )