Photo: Business Insider / Matthew Lynley
Cloud storage provider Box.net added 1 million new users in October after a huge marketing stunt.Since October 12, it has been giving away 50 gigabytes of free online storage. This drove is registered users to 8 million, up from 7 million previously reported at the end of September, CEO Aaron Levie told Business Insider last night.
Previously we reported Box.net was burning $18 million annually with $40-$80 million in revenue.
It’s burning cash and giving away its storage right now because it’s fighting in a super competitive space. There’s hot storage startup Dropbox, which had 25 million users as of April, and just raised $250 and a $4 billion valuation.
Then there’s Apple with iCloud, and Google which is supposed to come out with GDrive. Not to mention Microsoft and a number of other players.
Box.net says it’s going after a different market because it’s targeting the enterprise, but by giving away 50 gigs in online storage it’s clearly making a play for the consumer.
Right now, it looks like it’s working. But at some point it will have to cut the burn rate.