Then there's the term "Sub-licensable" that folks are picking out as unique to Dropbox and its nefarious plans to sell your garage band's music and make millions. Well, like many other Web 2.0 companies, Dropbox doesn't have its own data centers and EMC storage, but uses Amazon's public cloud services to host the service. Some lawyer figured out that if Amazon ran a backup and Dropbox hadn't sub-licensed Amazon to be able to make copies, that would technically be a copyright infringement. So Dropbox thinks it needs a sub-license.
Of course, some of the strum and drang was about the term "to the extent we think it necessary for the Service." With folks screaming that that meant Dropbox just had to think it might need to, say, release your student film and make millions, then it could. So Dropbox updated the ToS again to read, "You grant us (and those we work with to provide the Services) worldwide, non-exclusive, royalty-free, sublicenseable rights to use, copy, distribute, prepare derivative works (such as translations or format conversions) of, perform, or publicly display that stuff to the extent reasonably necessary for the Service. This license is solely to enable us to technically administer, display, and operate the Services."
The latest ToS seems reasonable to me and, by the way, comparable to other similar services like Box.net or SugarSync, which is working pretty well for me so far. To paraphrase security expert Bruce Schneier, "If you expect a cloud provider to do anything more interesting than simply store your files for you and give them back to you at a later date, they are going to have to license them the access they think they need to do whatever interesting things you want them to do." As for some of the professionally offended, methinks they doth protest too much.
P.S.: Dropbox announced a third rev to the ToS that should help unbunch some people’s panties:
…By using our Services you provide us with information, files, and folders that you submit to Dropbox (together, “your stuff”). You retain full ownership to your stuff. We don’t claim any ownership to any of it. These Terms do not grant us any rights to your stuff or intellectual property except for the limited rights that are needed to run the Services, as explained below.
We may need your permission to do things you ask us to do with your stuff, for example, hosting your files, or sharing them at your direction. This includes product features visible to you, for example, image thumbnails or document previews. It also includes design choices we make to technically administer our Services, for example, how we redundantly backup data to keep it safe. You give us the permissions we need to do those things solely to provide the Services. This permission also extends to trusted third parties we work with to provide the Services, for example Amazon, which provides our storage space (again, only to provide the Services).