Who’s winning the consumer cloud storage wars?

November 6, 2014, 4:44 PM UTC

In seemingly no time, cloud storage has become a commodity product. It’s already relatively cheap and competition is driving prices even lower.

On the enterprise side, Box, Amazon Web Services (AMZN), IBM (IBM), and EMC (EMC) are competing for the largest corporate customers. On the consumer side, Dropbox, Microsoft’s OneDrive (MSFT) and Google’s Drive (GOOG) are competing to store the photos, documents, music, and movies of everyday consumers.

It’s the latter market that has proven to be particularly interesting. Where the enterprise cloud storage market is a fierce battle among hulking warships—the most firepower wins—the consumer market is much more akin to a skirmish fought among speedboats of varying sizes. In a bid for the fickle attention of consumers, a clever maneuver can go a long way.

Microsoft and Google entered the consumer market with a huge splash, thanks to their massive installed user bases of people using Office and Gmail and Docs, respectively. But the company in the lead is San Francisco’s Dropbox. Though Dropbox is just six years old, it had a four-year jump on Google, which introduced Drive in 2012. (Microsoft has offered various cloud storage services since 2008, originally under the name SkyDrive.)

Dropbox claims 300 million users as of May. Google Drive has 240 million users as of September. Microsoft says OneDrive has “more than” 250 million users.

Because each of these services is free to use, the companies make money by convincing users to store so much data on their servers that they must upgrade to premium accounts. Google has a second motive: it can use storage to collect data on user activity and serve them more personalized advertisements.

It’s difficult to discern which company is winning on user numbers alone. Many people have accounts with both services, and even those accounts don’t reveal how frequently users are actually storing their files with either service.

One way to learn more about which cloud service users prefer is to through third-party app providers. CloudOn, a startup that makes word processing software for mobile devices, has accumulated eight million users since it launched in 2012. The app’s users connect their accounts to cloud storage services in order to automatically save their work and collaborate with others. In data shared with Fortune, the company revealed that its eight million users prefer Dropbox over Google Drive by a multiple of three. Microsoft’s OneDrive came in at a distant third.

Courtesy: CloudOn

Whereas 3.7 million CloudOn users connected their accounts to Dropbox, fewer than 2 million connected with Google Drive and fewer than 1 million connected to Microsoft OneDrive. The ratio of documents read on each cloud service matches the ratio of connected accounts. On CloudOn, than 1.1 million Dropbox documents are read each month, which is more than that of Google Drive and Microsoft OneDrive combined. Dropbox, which is valued at $10 billion and considered a prime candidate to make an initial public offering, is a clear winner among mobile-friendly consumers.

This week, Microsoft recognized that people who use Microsoft Office might not love OneDrive. The company announced a partnership with Dropbox, allowing users to access their Dropbox accounts directly from Office and edit their Office files from the Dropbox app.