Microsoft just announced that they are offering unlimited OneDrive storage for ~7$ a
year month along with Office 360.
Monetization of capacity in the storage industry is very hard. The storage industry was able to do that because of the cabling limitations of controllers and disk drives. Eventually you needed to buy a new controller because you could add no more disk drives to a controller. In the cloud the consumer never has to buy another controller, so the requirement to buy stuff to increase capacity never happens.
The fact that capacity is now going to be free – you’re paying for Office360 is showing that to be true.
After all the cost per GB is 0.03, the ability that you can charge 3x the cost of the media (30$ vs 100$) for a terabyte is unsustainable.
First movers in this space offered the novelty of cloud capacity, now that the capability has been commoditized, the end game for vendors in this space is going to be – interesting.
Other vendors will have to react to this change. How is going to be very unclear.
Google will quickly follow with a similar offer. I expect Box to be forced to do the same since they are competing with Google and MSFT for the same customers. DropBox will fight the hardest to avoid doing this but they too will eventually collapse.
Edit: Fixed the pricing to be monthly instead of yearly.