> And let's not get into the whole privacy thing. A 1 TB drive is, what, fifty bucks today -- and people would rather store their files in a datacenter across the ocean?

People would rather have convenience of access across their devices. Despite the fact that people tend to have home networks and go around with a wifi-enabled device in their pocket, syncing tools remain atrocious.

That's the pain that dropbox addresses, not the cost of storage.