Why Facebook Gobbled Up File-Sharing Startup Drop.io

Social Network Beefs Up Storage, Collaboration, While Mark Zuckerberg Gets an Old College Pal

By Published on .

David Berkowitz
David Berkowitz
Facebook's latest acquisition reunites two old friends from Harvard: Mark Zuckerberg and the founder-CEO of New York-based Drop.io, Sam Lessin. The file-sharing company is now part of the social network -- but there should be more to this deal than just a college reunion. The question is, well, what?

Harris and Zuckerberg do have a history. Former Fortune writer David Kirkpatrick writes in the "The Facebook Effect" about a time in 2004 when "classmate Lessin, whose father was a well-known investor, took Zuckerberg around New York to meet with venture capitalists and executives in the finance and media industries."

Launched in 2007, Drop.io is a file-sharing service with some nifty collaboration and productivity tools attached. Think Google Docs meets YouSendIt. Content can be added (to "drops") through more traditional means such as fax and phone, along with uploads directly from Facebook. By Dec. 15, the service will be shut down entirely.

On the surface, it's puzzling what technology Drop.io can bring to Facebook. One under-appreciated facet of Facebook is just how much effort it has put into storing files -- namely photos and, increasingly, videos. A note from Facebook Engineering posted last year goes into all of the arcane details behind photo storage, and its challenge only mounts by the day as it attracts more users uploading more photos and increasingly videos. Facebook even recently allowed users to share high-definition photos, which will create bandwidth challenges anew that the network is clearly confident it can handle.

Facebook must be aiming bigger than storing multimedia. It keeps inching in that direction, as its recent Groups overhaul allows for collaboration on documents. Using Drop.io's technology to store documents could provide further benefits to users, though it's not clear if Facebook would need to acquire new technology or manpower to build that out.

It does bring to mind how Gmail launched with so much more storage capacity than its rivals, leading early adopters to back up important files by sending them to Gmail. Facebook's ambitions may be even greater, as it positions itself to be a general cloud storage provider for all files relating to its users' lives. Facebook could even emerge as an operating system in its own right, even without ever calling itself that.

Drop.io wasn't just about file storage. It launched Presslift, for instance, as a new way to format and share press releases, though with functionality that established players like PRNewswire have also offered. It's possible there were other products in the works that haven't seen the light of day but that could be part of the acquisition bait.

Facebook has made it clear it puts a high price on talent. It reportedly acquired FriendFeed for the people who built it, even though Facebook was already making it easy to aggregate users' lifestreams at the time. And it just brought on Lars Rasmussen, who launched Google Maps and Wave. The potential for what these people can do is going to matter far more to Facebook than anything they've done yet.

David Berkowitz is senior director of emerging media and innovation, 360i.
Most Popular
In this article: