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Box swivels to SMBs with new subscription plan

The company isn't happy it's losing some smaller-size customers to Dropbox, Google Drive and Microsoft SkyDrive

By Juan Carlos Perez
August 21, 2013 12:59 PM ET

IDG News Service - After spending the past two years beefing up its cloud storage and file sharing app for use in large enterprises, Box has turned its attention back to small and medium-size businesses with a new subscription plan.

On Wednesday, the company introduced its Starter tier, priced at $5 per user, per month for teams of up to 10 people. It includes pooled storage of 100GB and an individual file size limit of 2GB.

The new Starter tier is sandwiched between the existing Personal plan, which is free for individual users, and the Business plan, which costs $15 per user, per month and includes basic IT administration and security features.

The Starter plan is intended to plug a gap in the product line and attract customers that need more than free, individual accounts for their employees, but can't afford the Business plan, and thus look at rival options like Dropbox, Google Drive and Microsoft SkyDrive. Those could be small companies or small teams within medium or large companies.

"We weren't competitive in the part of the market now covered by the Starter plan," Box CEO and co-founder Aaron Levie said. "We were pricing ourselves out of it."

In addition, Box announced that it has doubled the storage in the Personal plan to 10GB, and that it is introducing a new top-tier Elite plan that now becomes the fifth and most sophisticated product offering from the company.

It's the first time in about three years that Box has tweaked its subscription plan grid.

"We want to make sure we have a compelling offering" for all types of customers, Levie said.

Box also announced that Business tier customers will get the Active Directory integration option for the first time. The Business plan includes pooled storage of 1,000G bytes and individual file size limit of 5G bytes.

The Enterprise subscription tier, which costs $35 per user, per month for unlimited storage, 5G byte file limit and more advanced IT controls, remains the same.

The new Elite plan includes everything in the Enterprise plan plus broader support, a free test environment and unlimited use of the Box Content API (application programming interface) to develop custom internal applications. Box isn't disclosing pricing for the Elite plan.

Box also said that its service is now used in 97% of Fortune 500 companies and that it's on pace to more than double its revenue in its current fiscal year, after posting sales growth of more than 150% in the previous one. The Box product is used in 180,000 businesses by about 20 million people.

Box has raised more than $300 million in funding since its founding in 2005 from investors like Draper Fisher Jurvetson and Andreessen Horowitz. Levie has said he may take the company public next year or in 2015.

Juan Carlos Perez covers enterprise communication/collaboration suites, operating systems, browsers and general technology breaking news for The IDG News Service. Follow Juan on Twitter at @JuanCPerezIDG.

Reprinted with permission from IDG.net. Story copyright 2014 International Data Group. All rights reserved.
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