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History 2001: Web Storage Providers

Where are they now?

One year ago, we reported on the explosion of Web storage providers (WSPs).

Now, a full year later, in a far more uncertain economic climate, we thought it might be interesting to see how the landscape had evolved.

As we predicted, more than a few have folded, while others have reneged on their promise of free storage, changing to a fee-service model and warning users to buy space, remove files, or lose all data.

MySpace gave its users only 6 days to remove files before shutting down. Many did not even receive a warning before it was too late the Web site had vanished.

Of the most promising, Driveway and idrive have disappeared, while Xdrive has become a fee-service provider.

The most popular of all, FreeSpace, is cutting back its free storage offer from 20MB to only 5MB.

Beyond that, users will have to pay. Jack Sandner, CEO of FreeDrive, quoted in USA Today, tried to assuage critics. “Most people understand that free isn’t forever.”

But do they? X-drive, like idrive, had registered some 10 million users in less than a year. After the company announced its switch to fee services, users dropped below the 100,000 mark. Companies that hoped to entice investors (or potential buyers) with a model that attracted massive amounts of Web traffic have discovered how unpredictable that particular asset can be.

And while none of the companies in question promised they’d be around forever, we can’t help but wonder how many were cynically hoping to score a quick hit, sell off and move on.

Those, such as Driveway, that have been acquired were often integrated into an existing fee-service structure of a larger application service provider. Or simply killed off, once the user base was milked of its mailing list potential.

Given the record of many of these free-storage providers, it seems doubtful that individual or corporate users are going to rush to pay for a fee-based service that is just as likely to disappear. For one thing, it’s too costly in terms of time and bandwidth to move files around every three months or so when the provider goes bust.

This article is an abstract of news published on issue 162 on July 2001 from the former paper version of Computer Data Storage Newsletter.