Microsoft CEO Satya Nadella's vision of “Cloud for everyone, on every device” no doubt includes Enterprise File Sync and Share (EFSS).

Earlier this week the company put Box, and almost every other vendor in the space, on notice with a blog post, “Thinking outside of the Box.”  

Its author, John Case, corporate vice president of Microsoft’s Office Division, had a fairly simple message for the marketplace:

The era of making isolated, single-solution decisions is rapidly coming to a close. Smart businesses are now choosing partners that have a holistic, comprehensive and connected set of cloud offerings and in doing so, creating a 'data culture' in their organization.”

In other words, Microsoft users should look to OneDrive for Business as the way to go for EFSS.

When you take into account that 670 million users use Microsoft Office and Office 365, what Microsoft’s message boils down to is pretty simple: If you’re a point EFSS solution in our world, you’re redundant.

Granted, this might be a bit harsh. Especially if the new, more open, Microsoft that is supposed to play nicely with everyone walks its talk. But Aaron Levie, CEO of Box, didn't see that ray of light in the OneDrive announcement:

By keeping Office 365 users on the closed OneDrive 'island,' Microsoft is stranding hundreds of millions of users and customers that have chosen Box, Dropbox, Google Drive and others. And by releasing Office on the iPad without the ability to view or edit documents from any cloud service other than their own, they’re making it harder -- not easier -- for users to get the most out of their software.”

What Microsoft is likely banking on, however, is the large (and still growing) number of business users who live, create and collaborate on content using Office products, making OneDrive the path of least resistance for them.

And Microsoft is lowering the level of resistance to as close to zero as it can: It’s increasing OneDrive for Business storage from 25GB to 1TB per user, it’s giving all Office 365 ProPlus customers 1TB of OneDrive for Business storage per user as part of their Office 365 ProPlus subscription, and it’s offering to help organizations migrate data from their existing solutions to OneDrive for Business.

Functions, Not Storage, Win the Enterprise

It’s not a bad strategy, according to 451 Research analyst Alan Pelz-Sharpe, “Microsoft’s differentiator is it’s bundling with Office 365.”

And Microsoft is hoping that by giving away storage it will lure users to check out and sign on to their service.
But it’s not much of a carrot, said Jeetu Patel, general Mmanager of EMC Syncplicity.

Giving effectively unlimited cloud storage in the enterprise market is not news. Serious enterprise sync and share solutions have offered end users more cloud storage than they could ever use for quite some time (including Syncplicity with our Enterprise Edition). What's important is not how much storage an end user gets, but how easy is it for them to use that storage and gain productivity, while maintaining a high level of security.”

Ted Schadler, vice president and principal analyst at Forrester Research, certainly agreed with the first part of Patel’s sentiment, “Free storage is not a market maker,” he said, adding that it might help close a deal, here and there, everything else being equal.

What the enterprise sync and share market really cares about is features, said Schadler. “The arms race is for functionality,” he explained.

And security and control are, no doubt, high on the list -- that’s where larger vendors like EMC Syncplicity and smaller vendors like Accellion and Egnyte excel. They’re offering on premises and private cloud capabilities that others like Dropbox and Box don’t, and that Microsoft OneDrive for Business isn’t shedding a spotlight on if it does.

"For real enterprise adoption, a strategy where cloud storage is blended seamlessly with on-prem storage will be key for growth and success,” said Vineet Jain, CEO of Egnyte. He added that customers recognize the value that Egnyte’s hybrid approach brings to their business: “control” -- the ability to decide where to store which kind of data, in the cloud or on premises.

“Security and control is what matters most to the enterprise, while not sacrificing on end user ease of use,” he said.

Approaching the Cloud from a Different Angle

Accellion separates itself from the pack by taking an altogether different approach.

“Rather than signing up for cloud storage wars with Microsoft, Box and Dropbox, we’re focused on giving organizations the ability to run their own private cloud file sync and share to meet the increasing concerns of data security and compliance,” said Paula Skokowski, CMO of Accellion.

“It’s less about the size of the cloud you’re using, and more about the type of cloud. For corporations, it’s more important to have a cloud that’s not being monitored by the NSA," she added.

There’s no doubt that Patel would agree with the aforementioned. EMC Syncplicity offers policy-driven hybrid storage (cloud and on premises) to meet enterprise requirements for security and storage compliance.

We should note that with Syncplicity there’s no need to choose between heaven and earth. Its advantage in the sync and share space is that it’s able to innovate like a start-up yet access the resources of EMC.

But as vital as controlling and securing content is, how easily you’re able to access it, work with it and share it may be more important from a worker’s point of view. “If they don’t like what IT authorizes, they’ll find another way,” said Patel.

That’s why Syncplicity, Dropbox and Box completely redesigned and rewrote their apps this year -- they don’t look like something that was born in a browser and hacked for a phone. These companies have embodied what it means to be “mobile first.”

The jury, as far as we can tell, is still out on the OneDrive for Business app. One thing worth noting, however, is that in the iTunes App store you must be a SharePoint Online user or have a qualifying Office 365 subscription to use it. We suspect that this will soon change.

At the end of this day, the market is still wide open, according to Schadler. And the EFSS sector still has plenty to do. While the Forrester report says that 70 percent of workers are using an EFSS solution, we question how many of those are blessed by -- and as importantly paid for -- IT.

Will Microsoft OneDrive Emerge as a Player in the EFSS Game? 

In Forrester’s last EFSS Wave, Microsoft OneDrive for Business didn’t rank in the top ten, which means that Case and his team have work to do if it wants realize Nadella’s vision of “Cloud for everyone, on every device.”

We’re looking forward to watching this play out. 

It’s game time in the EFSS world!