There are many file sharing applications out there, and there can be just as many reasons to use them.  The major reasons seem to be:

1. A way to share files with other people without using email.  This is vital if the information is of a sensitive nature.  For example, you should never send an email with your social security number (SSN) on it!  Email is not secure by nature, and it may travel through dozens of servers before it gets to its destination.
2. In a similar vein, a way to share files between different devices.  If you have a desktop at home and a laptop you take on the road with you, then getting to that updated presentation to show your client becomes a must.
3. A way to backup files.  While online backup systems are nothing new, within certain limits they are often free.  Backing up your most important files online ensures that if anything happens to the computer itself (fire, flood, theft, etc.), then at least your most important documents will be safe.  A backup drive at your home or office is a good idea, but if both the backup drive and the computer are in the house during a house fire, then you have still lost your data!

A word about online backups: They are great for your most important data.  However, you don’t want your entire system backed up online, as it would take days to backup and restore.  Not only that, but there is a cost beyond certain limits that eventually exceeds the risk.  If you really need offline storage that bad, then either do it yourself by renting a safety deposit box or hire a reputable company to do it for you.

Confidential?  How Large? How Often?

If all you need is to share files with others, then you need to ask yourself how often you intend to do it and how large the files are.  If you are going to share a 1MB file one time, then it hardly seems worth it to setup an account somewhere just to do a one-time deal.  If the person is online, then email will work for most cases.

However, there are cases where email just won’t do:

1. If the file contains confidential information, then you might want to fax any document rather than email it.  If faxing isn’t practical, then it is worth your privacy to use a file sharing service.
2. If the file is large, then email is not the medium to use.  I hate it when someone sends me 7MB attachments via email!  Email was never intended for binary file sharing, and it is a kludge that makes it work at all.  There also is no guarantee that it won’t get cut off at the end if it is too large.  Most of all, it is downright inconsiderate to make someone download a file they may or may not even want right at that moment.  If you’ve ever tried to work online and send/receive emails while something in the background is tying up your machine, then you know what I’m talking about!  When it turns out to be a > 5MB attachment, that’s a good way to encourage me to block all of your future emails!
3. If you are going to share files on an ongoing basis, then email might not be the best strategy in this case either.  While any of these might be a consideration on whether or not to use a file sharing service, though, this particular item will help to decide which file sharing medium to use.
4. Likewise, are the communications one way or will the recipient(s) edit the file and send it back?

Confidential, Not Often, One Way

If you are only going to share files occasionally and the recipients really aren’t going to edit the files, then a service like YouSendIt will probably do just fine.  While the notifications are sent via email, the actual file rests on a server, requiring the person to go get it.

What’s nice about the service is that most of the desirable features are free for infrequent usage.  In particular, you can choose to have the person verify who they are via the email address you use to send the notifications.  While this is perhaps not a perfect solution, it does add a level of security suitable for most personal information.  For example, I feel at ease using it to send financial information to an attorney.

However, there also are per-use options that are good for infrequent file sharers as well.  For example, you can get a return receipt for $3.99.  If you use this feature often, then you’re better off with a premium account, but for someone who only needs it once or twice a year, it’s nice to not be tied down to an account requiring monthly charges.

All this is great stuff, but I need to emphasize that this is not a backup solution.  The storage on the server is temporary.  It truly is a “file sharing service” in that it allows you to share a file with no frills.  This differentiates it from a collaboration service such as Microsoft Office SharePoint is meant to be.

Backups, Collaboration, Frequent Changes, Sharing Between Devices

If you want real collaboration, though, or if your main goal is to share with yourself (either as a backup or between devices), then you really want a real time tool.  The more edits and changes you anticipate your files to undergo, the more features and checks you will need.

In addition, the larger the files, the more likely you are to butt up against limits on any system, and YouSendIt is no exception.  Currently, the maximum file size for YouSendIt Lite (the free edition) is 50MB, and the maximum total storage is 2GB.

Microsoft Office SharePoint 2010 is the premier way to share and collaborate files.  If you don’t have an internal SharePoint server, you can still do this online via Microsoft Office 365 (used to be known as “Microsoft Office Online”).  If you have MS Office Professional, then you can also take advantage of Office Web Apps to backup and collaborate on your Office files (Word, Excel, PowerPoint, etc.).

Note that Office Web Apps replaces the Windows Live SkyDrive.  Also, Live Mesh is gone and integrated into SkyDrive.  The downside of this is you can only sync Office files.  Zip files and PDF (Acrobat) files need not apply.

If you don’t need the sophistication of SharePoint, you can still backup and share files using any number of other services.  However, many of them have fallen to the wayside (drop.io, for example).  Some of them require you to use a web browser, which can be difficult on smaller screens.

The latest tool I’ve put into my arsenal is Dropbox.  I’ve been using it for about a month now getting to know it, and it has an easy-to-use desktop application where you can literally drag and drop files into to sync them up with your account.  You can choose specific files or entire folders to share out.  Some files can be “public”, which do not require an account for others to access, or you can share specific files and folders by inviting them to create an account.  Best of all, it is multi-platform (yes, there’s an app for that!  Not to mention an app for this too!).

Dropbox isn’t exactly a collaboration tool, but it will handle conflicts by creating a duplicate file for the owner to merge manually.  It doesn’t presume to know what you want, but if you are using versioning in Microsoft Word, it actually isn’t that bad.  If the folder is shared out, it will become evident that there are conflicting changes, which may or may not be missed by emailing documents back and forth.

Dropbox is free for up to 2GB.  There does not appear to be a file size limit.  If you need more room, then Dropbox Pro 50/100 and Dropbox Teams are available.

The only gotcha I’ve found with Dropbox is that the initial sync can take some time to get started.  I honestly did not think it was working the first time I tried it.  When I shared out a folder to my spouse, she didn’t think it was working at first either.  You have to wait until you get a green circle with a checkmark in it before the file is fully sync’ed.

Other than that, I find it works quite well both for sharing out files and backing up the most important documents.