Box and the Highly Competitive Cloud Storage Market

Posted in: Sector and Company Insights, box, cloud computing, dropbox, ipo, sector explorer, sector insights

[vcrow][vccolumn width="1/1"][vccolumntext]The cloud storage sector is exploding - Box is planning an IPO and Dropbox will likely follow suit. So, who are the other cloud storage contenders to keep an eye on?

Box is going public. Its cloud storage rival Dropbox is expected to do the same by next year. As these billion-dollar unicorns branch out from cloud storage to enterprise collaboration, they’ll be competing not just with Microsoft and IBM, but also with a plethora of other private companies in the space, who will all be looking to (Drop)Box to guide expectations of asset valuations going forward. Who are the cloud storage contenders to look out for?

To find out which companies are most integrally related or prevalent at the intersection of cloud storage and content collaboration, we used DataFox powered to map out the broader sector.  Note, these sector labels are not strict, because companies tend to operate in multiple spaces, but they do illuminate who the key players are at the edges and intersections. The reason for so many actors being in this space is the presence of a large and growing market.

Cloud Storage Sector Explorer


Implications of BOX IPO

Box just filed it’s S-1 and the world is taking note - and by “world” we mean any investors, advisors, acquirers, competitors, vendors and customers with an interest in cloud storage or cloud collaboration.

Box’s IPO has been expected for a while and for many pundits will be a major indicator of the health of valuations going forward, in the midst of increasing rumination about the current “frothiness” of asset valuations and their reminiscence of the Internet meltdown of 2000.

This S-1 also means that Box edges out Dropbox to the public markets. The cloud storage space has seen a lot of publicity in the last few weeks regarding growth and increased competition, perhaps because it is somewhat unique as a SaaS segment in that it has such wide-spread adoption amongst both consumers and businesses.

Alex Wilhelm of TechCrunch wrote an interesting piece illuminating the fact that, as storage costs have continued to come down, both Box and Dropbox have increasingly sought to become active and proliferate themselves in the enterprise collaboration space. This brings with it increased competition from publicly listed competitors such as IBM, Microsoft, and Google, competing in these closely-related spaces. It’s becoming harder and harder to identify discrete groups of competitors as product offerings broaden.

Cloud Storage Competitors

These are the competitors Box listed in its S-1 under each category:

Enterprise Content Collaboration: established vendors including EMC, IBM and Microsoft (Office 365 and SharePoint)

File Sync and Share: including Citrix (ShareFile), Dropbox, Google (Drive) and Microsoft (Skydrive Pro)

Don’t be mistaken - this dramatically understates the congestion in the space. A search for “cloud storage” on DataFox yields 687 results while a search for “enterprise content management” yields 470 companies. With additional cash in the bank soon, both Box and Dropbox could be expected to snap up a number of their competitors in overlapping, as well as new, spaces.

Among the top 50 cloud storage companies, Box and Dropbox are both high-quality relative to their vintage, according to their DataFox Quality Scores. These scores are displayed graphically relative to each company’s age. Click to zoom:

Cloud Storage Sector

Cloud Storage Investors

Within cloud storage, these are some of the most highly-represented investors - data from DataFox. Click to zoom:

Cloud Storage Sector