Microsoft Throws The Gauntlet On Cloud Storage

Microsoft’s announcement yesterday of offering unlimited OneDrive storage for Office 365 users is, as it should be, a very big deal.  In effect, they have gone to the market and told everyone that not only can they offer a cloud storage solution, they can do it at a cost that nobody can compete with the possible exception of Apple or Google.  I say this not as a fanboy but as a realist.  Only a company with the experience and shear size of Microsoft could put into play such an audacious plan.  And if you are an executive at Dropbox or Box, I would be waking up this morning worried.

The challenge all cloud storage solutions have had to this point is that it is, effectively, a one-trick pony.  It does what it says on the tin in that it stores your files and photos in some way or another to the cloud.  But that is fundamentally the problem.  You are paying a monthly or yearly premium to simply store your content online so you can access it from anywhere.  Functional, yes.  Great value, no.

Microsoft however does offer more than just cloud storage.  Okay sure, you are paying anywhere from $6.99 to $9.99 per month for Office 365 and it comes with cloud storage.  So really, in the purest sense, it isn’t free.  But what other cloud storage providers can offer you the latest and greatest version of Office and 1TB of cloud storage today?

Anyone?  Anyone?  And that is exactly my point.  Nobody can because their business model simply falls apart if they try to add any additional non-storage services to their solution because they would have to go license or buy that solution.  With Microsoft it’s all in house.  It’s an accounting shell game that makes sure one division of the company gets compensated from another division in the company.  For us, the consumer, we don’t really care.  We don’t see that end of it.  All we see is seven bucks a month, Office on our PC, tablet and smartphone, and 1TB of storage available to us.

The only possible players in this high stakes cloud storage game (I refuse to call it a war because it’s not much of a war at this point) is Apple and Google.  iCloud Drive is designed to be the answer for Apple users and they already give away the iWorks apps which are their version of Office (and they are pretty good, especially compared to the dreadfully painful Office for Mac apps).  But it is expensive.  $3.99 per month for 200GB of storage.  Need 1TB?  That’s $19.99 per month.  That’s the cost of just over 3 months of Office 365 with 1TB of storage today.

The other big challenge with iCloud Drive is it remains at the core an Apple only solution.  Yes you can use the iCloud Drive browser to edit, view and upload files.  But there is no app for it (even on iOS) and the storage organization is very limited.

If you look to Google, Google Drive is certainly a lower cost option than iCloud Drive.  1TB of Google Drive storage is $9.99 and you can access the Google Apps online for word processing, spreadsheets and presentations.  In fact Google’s apps are actually really good if you haven’t looked at them in a while or ever.  But again, you run into the challenge of integrating Google Drive into other platforms other than Android or Chrome.  Yes you can access files on iOS but it is clunky at best.  Window Phone?  Forget it.  There isn’t an official Google Drive app available.  So again, as a user, we bump into the wall of the garden.

Microsoft’s approach has and continues to be fundamentally different.  Their “Mobile First, Cloud First” mentality has produced an amazing set of Office apps for iPad, OneDrive apps for iOS, Android and Windows Phone as well as Macs and PCs.  It is arguably the simple most ubiquitous cloud storage options available.

If the cloud storage poker game is coming down to the titans of the industry, where does that leave the likes of Dropbox and Box, two long time players in the game?  It is a difficult one to answer but I can’t see how it ends well for them.  Without a solution that offers additional services or products outside of the storage itself, they are going to struggle to keep up with the game.

Microsoft has made a big bet with their unlimited OneDrive storage play and others will struggle to keep up.  Will some not survive?  Undoubtedly.  Have Microsoft moved the goal posts in the game?  Also, undoubtedly.

Who is the winner?  You and me.

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