Exclusive: Datto Drive Offers 1 TB File Sync And Share For Free Via MSPs

Datto's Rob Rae

Data protection developer Datto has quietly rolled out a high-capacity, enterprise-grade, cloud-based file sync and share offering that channel partners will be able to offer free of charge to customers who sign up for a one-year trial period.

That offering, Datto Drive, gives customers 1 TB of cloud-based storage capacity free for the first year, and for $10 per terabyte per month per company after the first year.

Solution providers told CRN that Datto Drive has the potential to take business away from competing solutions.

[Related: Datto Unveils New Investment Round, Discusses Tie To Hillary Clinton's Email Server]

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Datto Drive will help partners get more business, said Mark Calzone, president of Ash Creek Enterprises, a Stratford, Conn.-based solution provider and Datto channel partner.

Datto has the engineering on the software side to make Datto Drive a viable solution, Calzone said. "It's like a Microsoft OneDrive, but a lot nicer," Calzone told CRN. "I think it's going to blow the Dropboxes and the Boxes out of the water. It's going to be open source, so if you want to do some customization, you can."

There is high customer demand for file sync and share applications, particularly as companies find their mobile users increasing, said Dave Seibert, chief information officer at IT Innovators, an Irvine, Calif.-based solution provider and Datto channel partner.

"Mobile workers, to work from anywhere, need file sync and share," Seibert told CRN. "Solutions like Box and Dropbox charge good money for mobile file sync and share. Datto is saying it will provide equal or better services at an extremely competitive price. They will gobble up the business."

The development of Datto Drive stems from the fact that Datto already owns its own cloud, the Datto Cloud, said Rob Rae, vice president of business development for the Norwalk, Conn.-based data protection vendor.

The Datto Cloud has about 180 petabytes of raw capacity, all completely owned by Datto, and is growing by about 10 petabytes a quarter, Rae told CRN.

Datto's December funding round of $75 million brought an opportunity to invest in new offerings to raise the company's profile in the channel and in the storage industry as a whole, Rae said.

"We are looking for more opportunities to help partners make more money, but our marketing spend has always been in the channel, so our end-user recognition has been low," he said. "We have a great brand in the channel, but that has not extended beyond the channel."

Datto Drive marks Datto's first move to build a brand that business users recognize, making it easier for managed solution providers to increase their Datto business, Rae said.

"We'll offer 1 million terabytes to companies with their own domain names, 1 TB per company," he said. "We've seen estimates that up to 70 percent of [small and medium-sized businesses] are not working with MSPs. Our goal is to get those SMBs into the databases of our MSP partners. If those companies want the free terabyte, they need to talk to an MSP."

Datto Drive will not be offered directly to end users, and so leads from users with Hotmail, Gmail or Yahoo domains will not be eligible, he said.

For the first year, the 1 TB capacity for the Datto Drive file sync and share offering is free of charge, Rae said. Starting in the second year, the charge is only $10 per terabyte per month per company, he said.

This is a significant cost savings for customers, Rae said. "Datto has 600 people, and we use about a half terabyte of storage per month for file sync and share," he said. "We estimate that Dropbox for Work, at 35 cents per gigabyte per person, would cost of about $9,000 per month. Datto Drive would cost us $10 per month."

Datto Drive will help commoditize the file sync and share market and put pressure on leading competitors while giving MSPs a solution they can use as a loss leader to bring new customers to their offerings, Rae said.

Datto plans to build end-user marketing campaigns around Datto Drive, Rae said. To help channel partners, Datto will pass any leads from customers directly to MSPs to handle, he said. "Ten dollars per month is a way to get customers hooked into an MSP's billing system," he said. "We make sure this is not a cold call."

While Datto Drive will cost nearly nothing over time, it is still a simple, intuitive file sync and share solution, Rae said. "It's just as intuitive as any solution," he said. "We didn't want to create anything proprietary. It's a simple tool, so we don't need a ton of support."

The goal of Datto Drive is not for MSPs to make a lot of money on Datto Drive, Rae said.

"Nobody gets into the MSP business to offer file sync and share services," he said. "The value of the lead is worth much more than the cost of the file sync and share."

IT Innovators' Seibert said Datto is being extremely smart with Datto Drive.

"They're priming the well," he said. "It's a fantastic angle. They're going after a big solution space with a solution that everybody needs at an awesome price: free. This will let partners bring customers other Datto services. Everybody needs file sync and share. And that will lead to other services, like backup and recovery. We see that 32 percent of businesses don't do backups. Or they have backups that are not encrypted."

Ash Creek Enterprises' Calzone said that if a customer signs up for Datto Drive for a year and uses it for a year, they're probably going to like it.

"And when they purchase it, Datto's going to funnel them through a partner," he said. "It's kind of like getting your foot in the door. It's like a guy offering to clean your rain gutters for $25, and then finding that the roof needs to be replaced. As a partner, I'll have contact with the customer who is hopefully paying for a service, which makes it easy to upsell other services."

Datto is expected to pass leads to partners, while partners can also bring their own leads to Datto. "Datto will have a custom-coded link so if we want to push it directly, they'll know the customer belongs to us when the trial's over," he said.

Datto has the financial strength to invest in a significant push to build its business with its channel partners, Rae said.

"With our last round of investment, we now have a $1 billion valuation," he said. "We're the only channel-only $1 billion company. We're a B2B -- basement to billions -- company. And we're profitable."