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Microsoft limits unlimited OneDrive for Business storage to priciest Office 365 enterprise plans

Gregg Keizer | Dec. 18, 2015
No surprise, says analyst, after the elimination of unlimited storage for consumers.

Credit: Microsoft

Microsoft on Wednesday announced that only the priciest enterprise Office 365 subscription plans will be eligible for an unlimited OneDrive for Business storage allotment.

Coming on the heels of a decision last month to scrub unlimited storage from all consumer-grade Office 365 plans, Microsoft's latest move was no shock to Wes Miller, an analyst with Directions on Microsoft.

"Am I disappointed? Yes. Am I surprised? No," said Miller in a Wednesday interview.

Microsoft acknowledged the disappointment Miller mentioned.

"We ... recognize we are disappointing customers who expected unlimited storage across every Office 365 plan, and I want to apologize for not meeting your expectations," said Jeff Teper, Microsoft's top OneDrive executive, in a post to a company blog on Wednesday.

Previously, Microsoft had said that all Office 365 customers would have a never-ending supply of storage in OneDrive for Business, the service for commercial customers. As of Thursday, the firm's roadmap for the subscription service still states, "Moving forward, all Office 365 customers will get unlimited OneDrive storage at no additional cost [emphasis added."

Microsoft significantly revised that on Wednesday.

Only the most expensive Office 365 plans -- Enterprise E3, the to-be-retired Enterprise E4, and the new Enterprise E5 plans -- will offer unlimited storage if more than five users are on the plan. And then only in stages, with each increase requiring Microsoft's approval.

Between now and March, Microsoft will increase the storage allowance for customers on those plans -- as well as the corresponding ones for government customers and education -- from the current 1TB to 5TB. After that, companies and organizations that want more will have to ask for it.

"After this [5TB] point, customers who want additional storage can request it as needed by contacting Microsoft support," said Teper. He provided no details on how the extra space would be allocated, but Miller said he expected it would be in discrete allotments, perhaps 5TB at a time.

Office 365 Enterprise E3 lists at $20 per user per month (or $240 annually), while E5 -- which replaces E4, with the latter set to fall off the catalog by June 2016 -- runs $35 per user per month ($420 annually). Less expensive plans, including the $12.50 per user per month ($150 annually) Business Premium, will have a 1TB cap on OneDrive for Business.

Teper did not offer an explanation for the backtrack from unlimited for all plans, but a recent Microsoft message to consumers who subscribe to Office 365 Personal or Office 365 Home may provide a clue. "We made a business decision to reduce storage limits for OneDrive," said Douglas Pearce, a group program manager for OneDrive, in a post to Microsoft's petition-like UserVoice last week as he, like Teper, apologized for the poor way the changes were communicated.


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