Several years ago, I wrote a piece entitled “How Dropbox Will Die” that turned out to be quite popular at Forbes.com. My pitch was that Microsoft, Google and Apple would eventually make so much storage available so cheaply that whatever need I had for Dropbox would disappear, along with any incentive to pay anyone else for cloud storage.

I predicted the three companies would make their clouds an integrated part of their products, perhaps locking Dropbox, Box and all the others out of their ecosystems. Now, I’ve been a loyal — if free — Dropbox user for years, but my affection can be easily bought and Microsoft seems to succeeded.

Dropbox will put on a brave face and doubtless continue changing its business plan to offer flexible storage that enterprises will pay for. I, in turn, will no longer recommend Dropbox to my friends. That’s good for Dropbox because few users that I know have ever sent the company a cent.

If you are now paying Dropbox or Box for storage, you want to think about migrating your files over to Microsoft OneDrive and either save some money or spend the same and get a Microsoft Office subscription for free.

Meeting storage needs for most users

On Monday (6/23), Microsoft upped the size of its free OneDrive accounts from 7 to 15GB, saying its studies show that will meet the storage needs of most users.

“Our data tells us that three out of four people have less than 15 GB of files stored on their PC,” wrote Omar Shahine, Group Program Manager at Microsoft’s OneDrive.com unit.

“Factoring in what they may also have stored on other devices, we believe providing 15 GB for free right out of the gate — with no hoops to jump through — will make it much easier for people to have their documents, videos, and photos available in one place.”

At the same time, Redmond increased the amount of OneDrive storage bundled with all versions of Office 365 to 1TB per user. Since Office 365 for home users supports up to five users per account, that gives them a combined 5TB of cloud storage.

For 9.95-a-month, I am getting Office for five users/computers, mobile and tablet versions and up to 5TB of online storage. It’s pretty hard to complain about that deal and I recommend it to friends and coworkers. Business users pay more, of course, but also get more functionality. Microsoft began offering 1TB to business users in April.

If you just need for storage, Microsoft has also cut its stand-alone storage pricing. The new monthly prices are be $1.99 for 100 GB (previously $7.49) and $3.99 for 200 GB (previously $11.49).

Microsoft says these updates will take effect in the next month. Current subscribers will automatically be moved to the lower prices.

Market opportunities

I think there is an opportunity for apps that manage these huge storage spaces, including sharing and backup. I understand that my computer already has almost a terabyte of storage and I don’t use a standalone app, but often wished my Dropbox were better organized, especially if I didn’t have to do the work. If you have any suggestions of tools I should be using, please drop me a line.

Google had earlier cut it’s prices, which Microsoft matched for ala carte storage. Google also charges $9.99-a-month for a terabyte. Spend that much and Microsoft throws in its Office apps suite, plus four additional users and terabytes, as described above.

I am not sure how much public cloud prices can drop, though Box once ran a 50GB forever for free promotion, which I took advantage of. Having a terabyte essentially for free will convince Microsoft users to backup entire systems to OneDrive, something few of us seem to do today.

I don’t believe this price cut will kill Dropbox, but it and Box and all the others have had the rug pulled from under their consumer and small business markers and it remains to see what longterm value enterprises and investors will assign these companies. It’s not where I’d put my money.

photo credit: FutUndBeidl via photopin cc