Office 365 consumer revenue lags behind subscription growth

28 Oct 2014 | Author: | No comments yet »

Microsoft OneDrive now provides unlimited cloud storage for Office 365 subscribers.

Microsoft is offering unlimited cloud storage to all of its Office 365 subscribers, doing away with data caps and pricing tiers as it amps up the storage fight with Google, Dropbox and others.Microsoft is making Office 365 a considerably sweeter deal with unlimited OneDrive storage for all users, as the commoditization of pure cloud storage continues.

OneDrive was already one of the best cloud storage apps around, and it’s even better now that Microsoft has decided to throw storage limits out the window. That’s not to say it’s free–an individual Office 365 subscription costs $70 a year, and a home subscription, which would give unlimited storage to up to five users–costs $100 a year. The storage will be offered on OneDrive and will be available to subscribers to Office 365 Home, Personal, University and Business over the coming months.

Now you can stuff everything on your PC — heck, everything on your home LAN — into your OneDrive store and sync it all to Microsoft’s cloud for easy access to your files no matter where you are. The offer might not sound like much, but it means that anyone looking for cheap cloud storage can’t get any better than Microsoft’s offer – and that’s without even taking into account the free software that comes with Office 365. Microsoft’s move puts even more pressure on providers such as Dropbox and Box, which don’t currently rely on software or advertising revenue streams to supplement server costs. Office 365 is the subscription version of Microsoft’s productivity suite, which includes copies of Word, Excel, PowerPoint, Outlook, and several other programs.

It’s a compelling offer and it also seems like it could lure users used to the pay-once, keep-it-forever model of regular old Microsoft Office to the company’s more lucrative subscription models. So not only is their no ceiling on how many gigs of data you can store in the cloud, you also get access to the entire Office suite — Word, Excel, OneNote, Powerpoint, Publisher, and even Access and Outlook — on both your main computer and your tablet. Even though the storage isn’t limited to Office documents — it can be used to upload monster files and automatically back up every picture taken on smartphones running iOS, Android or Windows — the majority of eligible users probably would have a hard time filling up their previous limit of 1 TB, let alone spilling over.

But hey, if taking care of your online storage means accidently getting Microsoft Office on another couple of devices then not many people will complain about that. Also good: that your files stored in OneDrive will be maintained by the same company that recently risked being held in contempt for refusing a court order to hand over a user’s email. But unlimited storage opens up new possibilities that users may not have previously considered, such as wholesale backup of their computer hard drives, or even of their local backup drives. (“Back up your backup” is sort of a 21st-century version of the Boy Scout motto “Be prepared.”) There’s no limit on the number of devices that can access OneDrive storage, but access is tied to a single Microsoft account with a Personal subscription. If you call now, in the next 20 minutes because they can’t do this all day, Microsoft has another bonus for you: 60 free minutes of calling with Skype!

Sure, there are plenty of free calling options out there (like the new Hangouts dialer for Android) but if Microsoft wants to lob some free Skype minutes at you, well, you might as well make use of them. Google Drive offers storage tiers between 100GB ($1.99/month) and 30TB ($299.99/month), while iCloud storage tiers cost range between 20GB ($0.99/month) and 1TB ($19.99/month). Microsoft will continue to sell OneDrive space as a separate product, but the Office 365 Personal price is likely to be rock-bottom even if you never use the included Office apps. Google Drive is a better deal at $10 for 1TB, and Google’s apps are free to use… That’s not bad, but it’s also not unlimited*. *Before we know how great a deal this really is, we need to know what Microsoft means by “unlimited,” because in the tech world it often means “not really unlimited.” We’ll update this post when we get an official statement.

While Microsoft isn’t the first company to realize that killer apps drive cloud storage, it has arguably executed on that idea better than anyone as it turns online storage into a commodity. Some file types are prohibited from uploading, and there is currently a limit of 20,000 items (folders and files), which imposes a severe practical constraint on the amount of data that an Office 365 subscriber can store.

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