Applications that are built for consumers are increasingly used within enterprises. In the technology community this is popularly referred to as the consumerization of the enterprise. There are many examples: 

1) Gmail and Google Docs replacing Microsoft Exchange and Office 
2) Apple replacing PCs/Windows
3) Jira replacing bug tracking systems offered by legacy software companies like HP

File-sharing and content management is a particularly interesting example because it was previously dominated by Sharepoint and vertical specific products like IntraLinks in the financial services industry. At some point people realized this wasn’t merely an enterprise need, but also a consumer one, and there was a subsequent explosion of cloud-based file sharing software built by companies like Dropbox, SugarSync, Box.net, and a hundred or so others.

These companies have all begun to make progress selling into enterprises, but their sales angles have been different. Box.net, which is widely viewed as the most organizationally advanced new enterprise file-sharing solution, has gone to great lengths to differentiate themselves from others file-sharing services by appealing directly to the IT administrator or CIO who makes the ultimate buying decision. And, while consumers (employees) care most about simplicity, ease of use, and quickness, IT administrators freak out about data security because Dropbox or SugarSync allow seamless file transfers out of the enterprise. 

Dropbox and some others, it seems, have decided to stay focused predominantly on always catering to the consumer (employee), even if it trades off with administrative controls or security technologies that would put IT departments at ease. Putting aside any questions about who has the most customers in the enterprise or generates the most revenue in the enterprise, I  recently saw a slide from a Palo Alto Networks research report on bandwidth consumption in enterprises by browser-based file sharing services.

Fascinatingly, on a usage basis it isn’t even close. Box.net is a rounding error in the browser-based file-sharing usage category, and Dropbox is responsible for 22% of bandwidth. 

But, does that mean that security is irrelevant to these IT administrators? No, I think it means that the consumers (employees) use Dropbox even when it isn’t deployed in a controlled, enterprise way, even though their IT administrators would prefer they use software which is less seamless, but more secure. 

I think this is a HUGE opportunity for creating a new breed of 3rd party security software built on top of the Dropbox API. Just like Postini was built on top of e-mail clients in the enterprise, there should be security products which make consumer-focused file-sharing software appetizing to the IT department. By layering on encryption, access control, file movement control, etc. capabilities, it could form the basis of a truly disruptive business model. 

There are many examples of fabulous business opportunities created by building products that solve an acute pain point for IT departments. For instance, Splunk, Solar Winds, AppDynamics, Spiceworks, New Relic and others sell software faster, more efficiently, and more profitably than any other enterprise company I’ve ever seen.