Inferior Offering at Higher Cost Limits Growth 20% of iCloud customers were paying users in 2018, the last time Apple shared that stat. Meanwhile, Box (BOX), a direct competitor, had ~13 million paying users out of just 71 million registered users, or 18%, as of 2Q20. Dropbox has over 600 million registered users, but as of 2Q20, just 15 million (or 3% of registered users) were paying users. If Dropbox cannot outgrow the competition in such a favorable environment, will it ever?Īdditionally, Dropbox has not been nearly as efficient at converting free users to paid users. By comparison, Google Cloud’s revenue increased 43% YoY in 2Q20, and Microsoft grew its commercial cloud revenue by 39% YoY over the same period.

Dropbox saw only a 16% YoY revenue increase in 2Q20 and a 17% YoY increase in 1H20. On the contrary, it is losing ground to the competition. With COVID-19-induced disruptions forcing most businesses to adapt their operations to be more remote friendly, Dropbox was in prime position to gain market share. This WFH Solution Provider Saw Market Share Decline During COVIDĭropbox’s share of the global cloud storage market has fallen from 4.4% in 2017 to 3.6% in 2019 as more competitors enter the space and existing competition ramped up storage options.

Dropbox not only has to convince customers not to use Apple’s convenient and competitively-priced service, but it also must convince them that Dropbox’s service is meaningfully better. Furthermore, each of these users may find Apple’s new Apple One subscription (which bundles iCloud, Music, TV, Arcade, Fitness, and News) more appealing than a third-party service. DBX Users Vs Competition New Constructs, LLCĭropbox is at a disadvantage when it comes to competing for its competitors’ users.įor instance, Apple offers all of its customers 5 GB of free space through iCloud.

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