News flash: Dropbox still wants to be the Dropbox of the Enterprise …
… and it’s borrowing the concept of a partner program from legacy IT vendors to make it so
The notion of cloud-based file sync and storage (now known as FSS) has taken consumers by storm and sloshed over into businesses big time. And Dropbox, which is the market leader by far among consumers, wants to take advantage of that popularity within corporate firewalls and is launching a partner program to make it happen.
Last month, Dropbox execs talked to GigaOM broadly about this plan to push Dropbox for Business (once known as Dropbox for Teams), but did not share many details. Now it’s time to come clean.
The program officially launches Wednesday with 150 partners culled from “thousands of inbound requests,” said Adam Nelson, the Dropbox exec in charge of channels. For the chosen partners, there is a reseller portal to handle lead registration, purchasing and team management. “Our goal is to make the portal as easy for partners to use as Dropbox is for customers,” Nelson said.
And, getting to the crux of the issue, partners that register a lead will get margin on Dropbox for Business sales ranging from 15 percent to 25 percent of the sale each month on a recurring basis. The partners, not Dropbox, will handle billing and support. That “customer ownership” is a key bone of contention in traditional partner programs where resellers often get squeezed out of deals by vendors that insist on managing end customers directly. Dropbox for Business starts at $795 per year with unlimited storage.
Dropbox internal sales people will get paid on deals whether the deal goes direct or through a partner. In theory, that means inside sales people will not poach deals.
On the product side, Dropbox has been adding IT-friendly perks including Active Directory integration and single sign-on over the past year.
Dropbox will have to contend with a veritable army of other vendors that want this business and pitch their own FSS as more IT friendly and secure than Dropbox itself. They include Egnyte, Accellion, Box, LogMeIn and OwnCloud. And then there are the big boys coming into the more consumer-oriented end of the market, Google with Google Drive, Microsoft with SkyDrive etc.
Asked about who Dropbox is contending with in enterprise accounts, Kevin Egan, Dropbox VP of sales, would only say, “It’s a very competitive space.”
He also cited recent Spiceworks research that showed Dropbox to be the favored cloud FSS product not only by end users but by their companies, as well. A whopping 93 percent of end users in 272 small and medium businesses surveyed named Dropbox as their preferred choice. IT pros were less bullish, but still 40 percent of “companies” among 162 respondents named Dropbox as their favorite, still the No. 1 choice. This is interesting considering that some companies, including IBM, have forbidden its use.
The San Francisco startup clearly is banking that people who use Dropbox personally are demanding its use at work and will sway the buying decision. Dropbox says it is running in 2 million unique businesses and in 95 percent of Fortune 500 companies. Still, as the Spiceworks survey indicates, IT folks are less likely to embrace Dropbox than are regular consumers.
It’s the former constituency that Dropbox for Business has to woo. Now it’s hoping savvy partners will help it do so.
By Barb Darrow