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OneDrive dumps unlimited storage, slashes free storage amount by two-thirds

Microsoft says a "small number of users" abused the OneDrive limitless storage offering and now it must go away

Microsoft announced late Monday that it would no longer provide unlimited OneDrive storage to Office 365 home subscribers and that it’s slashing the amount of free OneDrive storage it provides by a whopping two-thirds.

The reason for ditching the unlimited storage, Microsoft said in a blog post, is that “a small number of users” really went for it by backing up multiple PCs, entire movie collections, and DVR recordings to OneDrive. Microsoft says these users’ excessive storage usage amounted to 14,000 times the average. Unlimited OneDrive storage for Office 365 subscribers rolled out just over a year ago in late October 2014.

Microsoft says it wants to stop “focusing on extreme backup scenarios” in OneDrive, and turn its attention to “high-value productivity and collaboration experiences that benefit the majority of OneDrive users.” Given the corresponding storage slashes in the lower-cost and free OneDrive tiers, though, the excuse feels like a somewhat offensive PR-speak attempt to cast blame on users rather than saying something along the lines of “we messed up by offering too much too cheaply,” or “we offered you tons of free storage to lure you into OneDrive, and we’re taking it away now that you’re firmly settled in our cloud.”

Microsoft is reducing all OneDrive storage limits to 1TB for Office 365 Home, Personal, and University subscribers. While the new limit goes into effect, current users will have time to pull their data out of Microsoft’s cloud. Office 365 subscribers have “at least” 12 months to get their data in excess of 1TB out of OneDrive.

Anyone who only wanted Office 365 for the limitless OneDrive storage can ask for a pro-rated refund for the remainder of their yearly subscription.

Office 365 subscribers aren’t the only people getting cuts in their storage limits. Starting in 2016, free users will only receive 5GB of free storage, down from 15GB. Microsoft is also discontinuing the 15GB camera roll storage bonus that allowed mobile users to upload their pictures to OneDrive. Like the free tier, the camera roll will stop in early 2016.

As with Office 365 subscribers, anyone on the free tier and/or using the camera roll will have “at least” 12 months to pull their data out of OneDrive and get below the new limit.

Microsoft is also doing away with the 100GB and 200GB OneDrive paid plans priced at $1.99 and $3.99 per month respectively. Instead, it will roll out 50GB of storage for $1.99 per month in early 2016. Anyone needing more storage than that can get 1TB and Office 365 Personal for $6.99 per month.

Dropbox and Google Drive charge $9.99 per month for 1TB of storage.

The story behind the story: Microsoft’s announcement makes it seem like the “small number of users” taking advantage of OneDrive’s limitless storage are to blame for the storage cuts. That’s unlikely as Microsoft must have accounted for extreme data consumption when it first rolled out the offer last year. Microsoft’s OneDrive generosity is being cut short just as the company is looking to trim fat. Microsoft laid off 7,800 employees in July, and reportedly another 1,000 jobs last month just as its latest quarterly report saw a 12 percent revenue dip from the year previous. Reducing OneDrive limits for millions of users is a quick and easy way to cut costs as the company looks to boost its bottom line.

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