And Microsoft Does It Yet Again…

Oh dear, regular as clockwork, Microsoft opens its mouth to change feet, and creates another PR fiasco for itself.

A year ago, Microsoft announced that it would deliver unlimited cloud storage to Office 365 subscribers:

Today, storage limits just became a thing of the past with Office 365. Moving forward, all Office 365 customers will get unlimited OneDrive storage at no additional cost. We’ve started rolling this out today to Office 365 Home, Personal, and University customers.

I signed up for this, and a few months ago, my 1 TB storage on OneDrive was increased, by Microsoft, to 10 TB, at no additional charge. If I were to put all of my music, photos, home videos and documents on OneDrive, then I would currently be using about 0.7 TB. That’s still comfortably under the old 1 TB limit, but the margin shrinks every year (I’m a packrat).

It all seemed too good to be true. It was.

Yesterday, Microsoft announced that there are going to be changes:

    • We’re no longer planning to offer unlimited storage to Office 365 Home, Personal, or University subscribers. Starting now, those subscriptions will include 1 TB of OneDrive storage.
    • 100 GB and 200 GB paid plans are going away as an option for new users and will be replaced with a 50 GB plan for $1.99 per month in early 2016.
    • Free OneDrive storage will decrease from 15 GB to 5 GB for all users, current and new. The 15 GB camera roll storage bonus will also be discontinued. These changes will start rolling out in early 2016.

The reason for these changes is that, according to Microsoft, “a small number of users backed up numerous PCs and stored entire movie collections and DVR recordings. In some instances, this exceeded 75 TB per user or 14,000 times the average”.

It does seem a little disingenuous of Microsoft to offer “unlimited” storage at no additional cost, and then be surprised when some people take them at their word. It would seem that we are all being punished for the actions of a few. And I use the word “punished”advisedly. By Microsoft’s own admission, the average user has 5.35 GB stored in their OneDrive (75TB / 14,000). Microsoft has now reduced the free OneDrive storage from 15GB down to just 5 GB (and abolished the 15 GB camera roll bonus). So the average OneDrive user will start paying.

Lowering the free storage from 30 GB down to just 5 GB for millions of customers does seem to be a slap in the face, even if Microsoft has attempted to offer a sweetener in the form of a free one-year (only) subscription to Office 365 Personal (with its 1 TB of OneDrive storage). I suspect many of those customers will simply walk and switch to alternative Cloud services such as DropBox or Google Drive, because at a single stroke Microsoft has just made their competitors’ services cheaper than OneDrive.

Sometimes I wonder what goes on in the minds of Microsoft management…

About Geoff Coupe

I'm a British citizen, although I have lived and worked in the Netherlands since 1983. I came here on a three year assignment, but fell in love with the country, and one Dutchman in particular, and so have stayed here ever since. On the 13th December 2006 I also became a Dutch citizen.
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2 Responses to And Microsoft Does It Yet Again…

  1. coffeemike says:

    The only thing I can think of is that it’s a (perhaps misguided) attempt to position Office 365 in a stronger light. OneDrive was generous for free, and also included web versions of the Office tools to manage your own files – I think it didn’t have full parity with the online O365 versions, but very close. By constraining the free services, it positions the $10/month O365 Personal as a more necessary or viable service offering, in a way. For a company that moves more and more to service offerings (not software licenses) on any device, O365 subscriptions are a key revenue stream.

    That said, I think you’re right, they’ve botched the PR on this. I have visions of marketing and sales staff running pell-mell across Redmond while Yakety Sax plays in the background, Benny Hill-style…

    • Geoff Coupe says:

      Ah – Yakety Sax and Benny Hill – spot on, Mike! Agree that O365 subscriptions are key for Microsoft, but to lower the free limit to just 5GB is cutting off one’s nose to spite one’s face. Bad move.

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