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I'm not sure where you're getting the Dropbox competitor bit.

Steam has had a storage system for game content for a while—this would let you transfer save game files between computers, for example. I didn't see anything in the story which suggests this would be extended to general purpose content.

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Well the press release says right there: "Many of the launch titles will take advantage of popular Steamworks features, such as easy installation, automatic updating, and the ability to save your work to your personal Steam Cloud space so your files may travel with."

I'm assuming my work is more than my save game files. :)

I was assuming this was like iOS' cloud system—saving a document to the cloud, but not accessing a real Dropbox equivalent.

It might not end up being "equivalent" to Dropbox, but that would still compete with Dropbox in terms of backing up and syncing files.

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