It's time to upgrade OneDrive's paid storage, Microsoft

It’s been literally a decade since Microsoft raised the cap on its paid Microsoft 365 storage plans to 1 terabyte of OneDrive cloud storage. It’s time for an upgrade, don’t you think?

Last week, Google changed its name of its Bard AI assistant to Gemini, launched Gemini Advanced, and — in the most important change of all — made 2TB of cloud storage the foundation for its new premium pricing tier. Okay, that last point is a lie. Because Google offered a free upgrade to its Google One plan six years ago, granting 2TB of cloud storage for $9.99 per month — the same price as Microsoft charges for 1TB of storage.

Okay, even that’s not totally accurate, since the same 2TB Google One deal is available to new users for $2.49 per month for three months, before returning to $9.99 per month.

The reason Microsoft loves subscriptions is that they’re sticky: You sign up, set it to autopay on your credit card, and forget about it. But as consumers start re-evaluating their streaming plans (do I really want to pay for Netflix if they cancel everything after two seasons?), it’s worth asking the same hard questions about Microsoft 365.

Microsoft 365 — both the $69.99 annual plan for Microsoft 365 Personal and the $99.99 annual plan for Microsoft 365 Family — give you Microsoft Word, Excel, and PowerPoint, the main reason that most people sign up. But from there, it gets iffy. Outlook? I’d much rather have Mail, thanks. Microsoft Defender? That comes with Windows, or there are other free antivirus solutions available. Clipchamp? I love it, true, but Microsoft tried to make that a $19 monthly subscription, too.

A consumer version of Teams, Access, Publisher, Forms, and Skype? I’m going to argue that the value there is next to nil for many people, especially in a world with Zoom, Canva, Microsoft Designer, and other solutions. Yes, there are hidden reasons to subscribe to Microsoft 365, but they don’t seem as potent as they once were.

Storage, though, matters, and it’s a travesty that Microsoft hasn’t kept up with the times. In 2014, phones like the Samsung Galaxy Note 4 offered 16Mpixel cameras, even back then. Today, a camera like the Samsung Galaxy S23 or S24 allows you to shoot 200Mpixel still shots, plus 4K videos and even more. As long as you set your phone to automatically upload your photos and movies to OneDrive, the available storage space can be sucked up quickly. And, of course, a Microsoft 365 subscription includes all of the other files that you use daily, from Word to PowerPoint. In all, what you might call “storage inflation” is increasing, and it will only continue.

One of the reasons that Google’s own storage policy change received such attention was that it felt unfair. Google used to offer unlimited photo storage, even compressed — which, to be fair, it didn’t have to do. But doing away with all that was just the first step in making all of the photos you uploaded count against your free 15GB storage cap, prompting you to pay for a Google One subscription, or at least additional storage. It was anxiety-inducing, especially during a pandemic when people didn’t need extra anxiety.

Now both Microsoft and Google are asking consumers and businesses to pay an additional fee to access the top tier of their respective AI LLMs: $20 per month for a new Google One AI Premium subscription (Google Workspace, 2TB of storage, and Gemini Pro, among other benefits) versus $26.99 ($6.99 per user per month for Microsoft 365 Personal with 1TB of storage, plus an additional $20/mo for Copilot Pro). Google simply offers a substantially better deal.

Microsoft has historically jerked consumers around when it comes to cloud storage, enough that I had to consult OneDrive’s Wikipedia page to get it all straight. Remember, in 2014, Microsoft upgraded Office 365 subscribers to 1TB of OneDrive storage, giddily pushed it to unlimited OneDrive storage, then reneged on the deal and settled on the 1TB limit a year later. It’s remained 1TB ever since. Even the Microsoft 365 Family plan (which offers up to 6TB of storage) doesn’t pool the storage; it’s 1TB per user, with up to six users.

It’s also worth pointing out, incidentally, that Dropbox’s low-end Plus plan is, yep, $9.99 per month for 2TB.

If Microsoft executives want to make consumers pay through the nose to satisfy their shareholders, there are plenty of AI-related services to justify the cost. Enterprises can afford those premium services, too. But jerking around consumers with Microsoft Rewards points and failing to upgrade the OneDrive tier with additional storage feels a little slimy. It’s time to get with the times, Microsoft, and offer more for our money.