Dropbox, $8 billion, and the value of data backup

Dropbox

Dropbox is trying to raise a reported $250 million from investors, a deal that would value the company at more than $8 billion. Dropbox isn’t saying much. It’s only issued a statement saying it has more than 200 million users and  “strong momentum.” But $8 billion worth of momentum?

“It’s pretty darn steep,” says Frank Gillett of Forrester Research. He says, to really make money, Dropbox needs some online partners.

“For example, a photo service that says, 'Look, put your photos in Dropbox, but visit our website and enhance your photos, or have them printed,'”  he explains.

Dropbox would get a percentage the photo service’s profits. But even if Dropbox gets a bunch of partners, it’s still facing lots of competition. What to do about that?  Nothing, says Larry Weber, CEO of the consulting company, the W2 Group. 

“The market for this kind of cloud storage is really endless,” he says.

Weber says there’s more than enough business for everybody. Because we’re constantly taking pictures we want to save. Forever.

About the author

Nancy Marshall-Genzer is a senior reporter for Marketplace based in Washington, D.C. covering daily news.

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