Cost Of Revenues: $413.7M (22%) in software companies this includes Operations and customer care. There are spending as much as video sharing sites or video conferencing app.
R&D Expenses: $727.8M (39%). This is an insanely high number for a company that is not a startup. The average for bigger companies is below 20%.
If their growth doesn't recover, which will be difficult, they are going to be a prime target for acquisition from Private equity. PE will slash the expenses significantly and run them for a profit for 5-10 years.
Last I just checked they tried to crawl out of their “it’s all about files. Simple!”-niche and become a fully web-based project management, chat, collaboration, office-thingie with links to GSuite and Office365.
As a long-time user it was quite incomprehensible, and definitely nothing I appreciated or felt added value to my Dropbox. On the contrary, I was annoyed by all the product-nagging about these features I didn’t want.
Combine that with them obsoleting long-established features in their desktop sync-software which made them the only universal file-sync solution across all platforms, the reason I chose Dropbox over competing offers.
Do all that, and you lost people like me as a user. I’m on Nextcloud now and not coming back.
I really don’t think they have worked out their survival plan yet. Trying to outcompete MS and Google on their own turf is obviously not a fight they’re going to win.
Dropbox in the current state can become a target for activist investors like Elliot. The high percent R&D expenses make them more attractive because there is more to cut.
Joking aside...
> They were able to reduce the expenses in the last 2 years
That sounds pretty good to me! Reduce expenses but revenue is growing and revenue per user is growing. So they make more money without growing costs. That's great. With the layoffs that ratio would even improve.
We can disagree on their future, but for me it is likely that they'll face more challenges and more pressure from the investors.
The only way one would prefer something half-baked just because it's "free" is if they don't really care about robustness and dependability.
That said, maybe the current Covid crisis is hurting them more than others. I used to travel a lot and leave machines in different places instead of carrying a laptop everywhere. Now that I don't travel, "magic sync" is much less useful.
Because of Google's abysmal customer service which is awful to the point that even googlers can't get help if something goes wrong?
The point of a cloud storage is that you want your most important files to be backed up somewhere that you trust. I don't trust to store my data with an advertising company.
$120/year for privacy and customer support may be worth it to you but for the vast majority of people it's cost prohibitive.
* Insync adds xml suffix to files with xml contents.
* Expandrive borks file editing sometimes (happened twice - it was enough to move to Dropbox)
I still use Google Consumer Storage though, thanks to Google Photos. Can’t get rid of it, nothing better feature, simplicity and maintenance wise.
That doesn't help if your target customers believe they can get the exact same thing at a much lower price. (And many of them get those services from their employers for free.)
What?? I don't know about Evernote. But did you look at the financials of Dropbox? They have a solid sheet so maybe take a look before you suggest people there to look for another job.
They decided to shift their focus to enterprise. They made a decision not to compete on the consumer side. Enterprises don't need a free tier. I don't know if that was a smart decision, but I'm sure they looked at the numbers and made the decision based on it.
If they don't grow the investors are not going to be happy about the high engineering expenses.
You are aware that this discussion is about an announcement that they're cutting 11% of their workforce, aren't you? Anything can happen when companies get in this position.
Evernote support sucks though. Last version has two annoying bugs which still haven’t been fixed since Christmas. But Notion is slooow and Nimbus Notes feels buggy —- I have hit sync bugs in the past and can get 50x errors from server easily, in addition to a random error about the slave being read-only. Both auto-fixed in 5 mins but still...
Everytime I sync something big (many files, many dirs) with Onedrive I feel the urge to check on the website of everything arrived. I don’t trust the UI, and neither this guy [1]. I am a bit more at ease with Google Drive - I use Insync - until I found out Insync was appending the suffix xml to files with xml contents. Insync with OneDrive requires more testing - could be a good replacement but I must do more testing to see if the refusal to sync certain file types like PST and ONE [1] also exists.
[1] https://www.eejournal.com/article/onedrive-down-the-road-to-...
I was also going to comment on their similarities. It's not mentioned as often, but Evernote's biggest selling point in the beginning was that they figured out how to make multidevice sync work. The product was good, but not unique. In the early days there were no competitors that could offer the comfort of Evernote's sync.
Unfortunately both companies still have a 2010 mindset, at least when it comes to setting price. Neither seems to understand that their pricing is insane in 2021. $120/year is just too much for Dropbox (and nobody's going to fall for the 2 TB thing). Neither has a competitive free offering, so they're dropping off the radar for anyone looking for a free plan. Anyone working at either company that's not looking for a job should be.