New 'Dropbox for Business' Raises Legal Concerns

Cloud storage company Dropbox is revamping its service with small business owners in mind: It's now offering separate business and personal accounts.

According to The Verge, Dropbox has unveiled new "Dropbox for Business" accounts, allowing small business owners to manage their business accounts and to easily switch between work- and non-work-related "bins."

This is a welcome change for small employers looking for a cloud storage solution, but you'll also want to consider some potential legal concerns raised by Dropbox for Business.

Security Issues With the Cloud

TechCrunch reports that Dropbox boasts at least 200 million users, and "4 million businesses" currently use the cloud storage service. But are there security concerns?

One of the biggest worries for a small business owner turning to the cloud is security, and Dropbox may need to convince employers that it's safe before becoming an industry standard. For wary entrepreneurs, Dropbox currently offers these security features:

• SSL and AES-256 bit encryption,
• Two-step authentication at login, and
• Public access only to those who have a link.

Cyberattacks can cripple a small business if its cloud storage accounts are compromised, so entrepreneurs may need more data-security assurances before fully embracing Dropbox for Business.

Potential Employee Issues

Aside from security issues, the new Dropbox offers even more control for employers over their employees' data. Business owners can already read their employees' emails and work-issued cell phones, but employees may not be aware that their business Dropbox accounts can be accessed by their employer.

A more streamlined integration between Dropbox personal and business "bins" may also lead to employees forgetting which bin they are logged into at home or work. For example, if an employee is storing NSFW (not safe for work) files on his or her "work" Dropbox bin, you may have a lawsuit brewing.

Even when employees know which account they're logged into, Dropbox and other cloud data services offer an easy portal for employee data theft. Companies may want to keep an especially tight leash on contractors in restricting their access to future Dropbox business accounts.

Having more employees may also mean paying for more Dropbox accounts, as TechCrunch reports Dropbox did not mention "changing its pricing from the current $795 for 5 users and $125 per additional user."

Business owners will have until early next year to mull over security issues and potential costs before Dropbox for Business officially launches.

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Related Resources:

• Dropbox Aims at Business (The New York Times)
• Why Are Small Business Cyberattacks On the Rise? (FindLaw's Free Enterprise)
• Bad Call? 1 in 3 Businesses Aren't Going Mobile (FindLaw's Free Enterprise)
• iPad POS Systems Touch On a Few Legal Concerns (FindLaw's Free Enterprise)