Look at web search--it's no harder to type www.bing.com instead of www.google.com (it's actually 2 letters easier), and for most common searches, the results will be exactly the same. "What time does the Super Bowl start". "Facebook login".[1]

And yet, Bing has not significantly dented Google's web search market share despite $billions of investment in technology, advertising, incentive plans, etc.

> If Dropbox accidentally destroyed just one person’s file, he said, it could erode the trust of all its users.

Ha! Dropbox destroys user files against the will of users all the time--it's inherent in the concept of a syncing service, and why we warn each other, "Dropbox is not a backup service."

And if you're thinking of just straight-up data corruption or loss, look at Evernote, which does that on a regular basis yet continues to grow.

There's nothing more to this story than the fundamental threats that face any business in any industry: if you fail to please your customers, you leave the door open for competitors. But, that doesn't mean there is no margin for error. Or even a small margin for error.

[1] http://searchenginewatch.com/article/2051199/Facebook-Login-...

Dropbox at one time destroyed a ton of my partner's files. There was even an HN post about this at the time, which caught the attention of the Dropbox staff and they helpd him correct the issues.

(Note: both of us still use and love Dropbox. But to say it's never destroyed anyone's files is flat out wrong).

You don't explain how they resolved this. If this was a restore from their backup and your partner didn't actually lose his files forever, is this really "destroying"? I don't use dropbox (for no other reason than my ADSL upload speed is terrible) so not asking as a defender or fanboy.

I think they managed to track down most of the missing files afterwards, but it wasn't fully restored, and definitely not easily.

Again, this shouldn't dissuade you from using Dropbox. But it is most decidedly NOT a backup solution, and people don't just say that sentence for fun - it's true.

I wonder how perception would change if instead of doing multipliers they did percentage off and discounts of a higher price which covered more bases. Then they could even reverse auction (I think that is what it's called, right?)

This is not uncommon in retailing where exorbitant prices are stated and then discounted. And there are cases where some people pay the high prices and are ok with paying them.

My point is, is it better to say (using an airline flight as an example):

Regular price of $945 to fly to SFO.

Today's price is $345 (normally $945) to fly to SFO.

..and so on.

The existence of taxis as a very ready basis for comparison makes it different than airlines. Uber can (and, you know, does), say "We're 30% cheaper than taxis!" Then, sure, surprise, sometimes you see that actually they're 3x more expensive than that. But at that point you've got the app open and are seconds from doing the hailing -- that's gotta have a certain level of stickyness.

If Uber said instead, "We're twice as expensive as taxis!" significantly fewer people would even open the app to find out that actually, right now, they're way less expensive.

The other

Round trip, SFO-PVG: $700

One way, PVG-SFO: $1300

I'd really like to get in on that PVG-SFO flight for under $700...

Don't do this often if you care about your frequent flier miles though.

Why would you need the other party to sign up? Isn't that the point of public links?

And in the other direction, Gmail is a big popular email service now, but it took many years, and a dramatic value proposition (1GB for free!) for them to make inroads against Hotmail and Yahoo.

I see no reason to believe that free users would be any less likely to be loyal than paying users.

That was the rule of thumb I heard quoted in Business Studies, too. I think the key point was that a customer base tends to have a lot of inertia. To overcome that, you need at least one element of your competing offer to be dramatically better, and for quantifiable things like a price, an order of magnitude is significant enough to achieve that (and by implication a factor of only say 2x or 3x wouldn't necessarily be enough to dislodge an established brand).

Clearly there's a lot more to market dynamics than that in practice. On the one hand, we have supermarkets competing over prices for commodity household products by the penny/cent. On the other hand, at least here in the UK, we have industries like mobile phones, personal banking and household utilities that are all notorious for having poor customer service yet also all have surprisingly low numbers of customers switching brand.

I'm not sure where on that scale a typical consumer Internet service would fall, but in all cases it seems highly unlikely that a service with an inherent element of lock-in (even if you can move your data, it's going to take time and effort to do it) has anything to fear from an occasional screw-up that affects a few customers. It's obviously undesirable, and hopefully none of us thinks it's OK to dismiss anything that damages any paying customer out of hand, but it's not some sort of doomsday scenario that is going to bring down a whole company overnight.

"That was the rule of thumb I heard quoted in Business Studies, too."

I've never heard of the 10x better statement from any of my academic business studies. The only golden rule seems to be that you can't compete with an incumbent with "As Good". That is you can't create a soft drink as good as "Coke" and expect to do any serious damage. "As Good" is not compelling enough for most consumers to switch.

However, if you can make it "As Good" but cheaper, then you have a very good chance of unseating the incumbent. In the case of Dropbox, Google drive and other similar services, they are as "As Good" but they really don't offer anything different from one another. Note, I don't know what the paid plans are for all these services, but from the "FREE" users perspective, there really isn't anything separating them. And this is where Dropbox has the advantage since they were the first movers.

I think the point of the story was that in many cases, you don't have a particularly good chance of unseating an incumbent with a similar level of product just because you're cheaper. Often you have to be much cheaper, or people who have already bought into the other brand are unlikely to move. There are a variety of reasons for this, from the practical cost (time and effort to migrate may not be trivial, depending on the nature of the service) to the psychological (brand loyalty 101: having chosen a brand, people want to believe they made the right choice, so they have a tendency to defend their decision to others and rationalize away any competing alternatives as inferior choices until the difference is wide enough that they can no longer bring themselves to believe it; see also: it's easier to retain existing customers than to attract new ones).

Do I trust company X to safely store my files. Microsoft, Google and Apple can compete on this.

Can I access my files from X. Google is probably the only one right now that can compete with Dropbox.

And what does it cost. Since Dropbox's biggest user base is Free, you can't go lower than free. But if you are a paying customer, I can't see brand loyalty having any affect because I can't see such a bond forming. It's a behind the scenes solution and if done well, should be invisible.

If "As Good" can be commonly defined among a large user base and if you are "As Good", you can unseat an incumbent with price. And the price difference doesn't have to be too significant as academic studies have shown.

Coke is able to fend off cheap generic brands because no matter how low they go, they know they can't match them on taste. And that's due to decades of cleaver advertising to introduce that psychological barrier. So no generic brand can ever say they are "As Good" with people believing them.

For the space that Dropbox is competing in, I really don't see any other defining variables, other than "Trust, Access, and Price". And these are all pretty tangible points with the vaguely subjective one being "Trust". And it's the reason why they are in such a precarious situation that they are in.

So let's say that users are as fickle as the article implies. They have a little problem, so they jump from Dropbox to a new competitor. Then they have a little problem with the competitor...so they jump on to the next startup service? And the next? And the next?

People are not dumb; they know that similar products face similar challenges. If data loss is possible with Dropbox, it will be possible with a Dropbox competitor too. Maybe even more likely, if the competitor is an unproven startup.

As someone who writes code for jet engines, I find this perspective laughable. A better analogy would be if an automated baggage handling system lost your bag. You'd lose your stuff and the airline would lose your trust. You might rant about it on a blog and a few people would get upset and switch airlines with you. But nobody dies.

So the article's suggestion that "customers opening up the app and seeing no rides on the map" would be an existential threat to Uber is currently being proven wrong by Uber's success. That happens all the time and Uber is still doing alright.

Not sure if you'd get the same response as uber taxi. Some of the hailo drivers also had the uber app running somewhere on their dash and some did not.

That's why we love them and founders sleep on floors.

Instagram, as one easy example, had a billion dollar valuation with three dozen employees and was anything but a corporate giant.

How diversified was Google in its first ten years? Ads and desktop search overwhelmingly ruled. How diversified is Facebook? How diversified is Twitter? How diversified is Apple? (with the iPhone generating 75% of their profit)

This tends to apply to almost any big company in its formative years. They get big because they put all their wood behind a killer arrow that made all the rest possible. That's not to say Dropbox will have that future, but rather that criticizing them for not diversifying at this point is a low quality criticism.

The article struck me as being very poorly written for this reason. As if offering some generic web widget will help Dropbox diversify and survive if users lose faith in their syncing product. If the author knew anything about startups he wouldn't have made this the central point of this piece.

> This is also why Uber believes it can’t compromise once it begins to offer its services in a new city, or a new country, like France. It strives to work with regulators to accommodate its existing service rather than changing how it works.

It's not the regulators/government that are a problem, it's the taxi unions. You're talking about a place with a very strong, and very long history of active union activity.

"We can't compromise on service". "Fine, we'll drag your drivers out of their cars and set the cars on fire. Your move."

In the US, there is a system of taxi medaillons whose result is that rentiers get rich [0]. The tl;dr: the right to operate a taxi is bound to license of which there is an artificially limited supply. These licenses typically do not belong to drivers but to rentiers, who rent them out to drivers. The drivers lose, the passengers lose, the rentiers win.

France has unions, which makes it unlikely that there are third party rentiers who profit off the system in the same way as it happens in the US. Perhaps the passengers still lose, but the drivers probably don't.

That makes the framework in which Uber is trying to enter very different, and it means that Uber just may not be the good guy there. After all, pretty much everybody can agree that "rentiers = bad". On the other hand, "workers = bad" has far less support.

[0] http://blog.priceonomics.com/post/47636506327/the-tyranny-of...

Here in the US we used to be quite pro-union but this sentiment has changed drastically in the past 3-4 decades. I'm just old enough to have seen some of the change first-hand.

Some argue that this occurred at great cost to our ability to sustain a middle class:

http://www.salon.com/2013/12/30/the_middle_class_myth_heres_...

Being from the US it is hard for me to know how well a non-US citizen understands how much our view of unionized labor has changed here in the relatively recent past.

Steinbeck suggested (paraphrased) “Socialism never took root in America because the poor see themselves not as an exploited proletariat but as temporarily embarrassed millionaires.”, this is now more true than ever and it goes beyond socialism to ideas like unions and progressive taxes on the rich (and/or corporations) where the majority of citizens here (at least the ones who vote) are now against these despite the fact that in many cases these things would actually be in their own personal better interest today (as opposed to tomorrow when they win the lottery or get their own redneck reality tv show and are suddenly one of the elites).

Since they worth a lot (~250k€) and that taxi driver is a liberal profession, they acts as a retirement plan / life insurance.

This is why taxi unions gets really upset when there is a governmental plan to raise the amount of licences, or when any unregulated competition shows up (motorbike taxis, "private drivers", and now Uber).

Yup. Especially in SF, the medallion owner just won the lottery and rents it out. No one is going to risk going to jail to protect their boss' monopoly.

And yet there still was taxi unions that would throw their weight around.

Kind of hard to get a business off the ground when Unions control everything and free enterprise is essentially suffocated out of the country.

The ironic part of the Uber story was the Taxi Union complaining about "unfair practices".

Last time I checked, France was still a quite functional first world economy, independent of recent attempt by certain press outlets to place it near every ideological precipice you can think of (I'm looking at you, The Economist).

Taxi drivers have higher costs than Uber drivers because of two reasons: Firstly, they must comply with lots of regulations that are specific to taxis and the driving thereof. Secondly, they are unionized, thus keeping the taxi rates from dropping too low.

Both points deserve to be debated and none of them is a no-brainer in favor of Uber. Especially regarding the regulation issue, I personally am not inclined to sympathize with Uber. Most of that regulation is there for a reason.

Ultimately, I think its really a shame that the OS vendors haven't made 'cloud-based auto-discovery and user-control over publication' a major feature of their OS. The reason we need/want/love Dropbox is simply that the mainstream OS vendors dropped the ball, imho, and got lured away into Web2.0 land when they should simply have been adding these features - a distributed, cloud-based networked filesystem - directly to the OS. Why do I need another custom extension for this, from an unknown startup, when it could as easily be implemented as an OS feature? I think the reason is, the vendors are asleep at the wheel.

I've enjoyed the process of setting up my own cloud services for things like filesharing, using whatever tools I can .. but I sure wish it were just something to 'turn on' in OSX or Ubuntu, or whatever .. without requiring a third-party involvement (Ubuntu One or iCloud = no thanks!).

So I see Dropbox's future as being pretty cloudy, personally. I think the repercussions for American cloud providers, especially, are coming .. the desire for a private cloud is a big itch.

This is false. If Uber gives an inch, their competitors will go for the kill and move on to targeting the jugular. What they want is for Uber to not exist, and for there to be no new competitor or revolution in their business. There is no way to appease their competitors that results in Uber surviving as a useful service.

What Uber's competitors want is very simple: 1) they want to not have to compete with any innovation; 2) they do not want to have to change or improve their services; 3) they want no new, fast growing entrants allowed in their markets

Basically what they want is a frozen, guaranteed market with zero market forces. That's why their response is: violence, regulations, political leverage, etc (anything but innovation or actually competing with Uber).

Even at huge companies with resources dedicated towards IT infrastructure, systems still go down with regularity. Dropbox is probably still more reliable than what many large companies use.

Finally it comes to what wins the customers: Trust or Utility or the Balanced of Both.

I could go and replace all of these with another tool, but I would have to have a compelling reason to do so and would probably have to find some new apps (or the apps I use would have to integrate a new service)

ASFAIK 1Password, GoodReader, BoxyTunes, QuickOffice and tons of file managers in Android