Dropbox Aims to Solidify Its Place With Businesses

SAN FRANCISCO — Perhaps it should not have surprised corporate information technology departments that employees would use Dropbox, a service for easily sharing files among different devices by storing them in “the cloud.” But that did not mean they loved the idea of confidential files on a service they could not control.

Now Dropbox is trying to appease them by selling a service for businesses, Dropbox for Teams, introduced Thursday.

Add Dropbox to the list of consumer technologies that have infiltrated the workplace, like iPhones, Gmail and Skype.

“With the ability of people to get what they want to get done with stuff they pay for themselves, the whole role of I.T. changes,” said Ted Schadler, a workplace analyst at Forrester Research. “Dropbox is just the latest example.”

Still, the service has a ways to go before large companies adopt it, Mr. Schadler said, “because it doesn’t have as much security and administration as they want.”

For Dropbox, one of the darlings of Silicon Valley with a reported $4 billion valuation from venture capitalists, its new service is a bid to buy paying customers and solidify its foothold in the burgeoning file-sharing business..

It is competing with big companies like Google, Apple and Amazon.com, which offer increasingly sophisticated ways to store, share and sync files, and smaller ones like Box.net, YouSendIt and SugarSync. This month, Citrix Systems bought ShareFile and Research in Motion bought NewBay, both cloud storage services.

Dropbox allows people access files, like documents, photos and music, on any device wherever they are, without pesky zip files or hulking e-mail attachments. As people edit files, Dropbox updates them so a single file is available on all devices. Most people use it for free and can pay for additional storage.

Dropbox, which started in 2007, has 45 million users who save more than 2 billion files each week. But it has scared some people, too. In June, a security breach left Dropbox accounts accessible for several hours, and a complaint filed with the Federal Trade Commission says Dropbox misled users about privacy.

Dropbox says it uses the same security measures as banks. Files are encrypted and Dropbox restricts its employees’ access to files. But security is only as good as a user’s password. Dropbox said it is working on two-step authentication, so people would enter a second password sent to their phone, for instance.

“These are all things we take very, very seriously because our reputation and the confidence and trust people have in Dropbox is what we’ll succeed by,” said ChenLi Wang, team leader for business and sales.

Millions already sign up with their work e-mail addresses and the company estimates that at least a million businesses use the service.

Dropbox for Teams, which starts at $795 annually for five users, has 1,000 gigabytes of storage, phone customer support and gives I.T. departments control to add or remove users.

SusieCakes, a California bakery chain, has been testing Dropbox for Teams to share petty cash reports in real time and exchange documents with outside lawyers. The service is easier to use than options like Microsoft’s file-sharing service, called Windows Live SkyDrive, said Houston Striggow, SusieCakes’ co-founder.

“It’s really proven for us to be a powerful business tool that’s made us a lot more efficient and productive,” he said.

But Mr. Schadler, the analyst, said that before it has widespread business adoption, Dropbox needed features like security controls to automatically stop people from sharing confidential documents or to put files on home computers on legal hold. Dropbox says it is working on new features, including extra security measures and collaboration tools.

Of Dropbox’s competitors, Box.net has made the most headway in businesses, Mr. Schadler said.

Google is also going after businesses with tools like Google Docs, which lets employees collaborate on the same version of a document, and Chromebooks, laptops that store everything online so people can access it from any computer. The company is rumored to be introducing a file-sharing service.

Sujay Jaswa, Dropbox’s vice president of business development and sales, said its service has an advantage over big companies because it enabled iPads, Android phones and P.C.s to work together.

“You need a company like us that doesn’t have a horse in the race to be there for consumers,” he said.

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