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onedrive_april1-1024x460Microsoft announced today that it’s offering 1 TB of storage to every person who subscribes to its OneDrive for Business plan, compared to the 25 GB of space it offered when it launched the service last year as SkyDrive Pro. In addition, subscribers to Office 365 ProPlus will get free access to OneDrive for Business included in their plan.

It’s a big move for the service, especially as Microsoft tries to get more businesses onto its Office 365 subscription service. OneDrive is the glue that makes it easy for users to get documents to and from different devices using Microsoft Office, including the recently-launched Office for iPad.

onedriveRight now, Microsoft is only charging an introductory price of $2.50 per user per month for one year of OneDrive for Business, though the company says that will increase to $5 per user per month in October.

The change means that the standalone version of OneDrive for Business costs a fraction of what Box and Dropbox charge for their Business plans. Box’s plan includes 1 TB of storage for $15 per user per month, while Dropbox charges the same price for as much storage as a company needs, so long as they have more than 5 users.

The Office 365 ProPlus integration means companies that are prepared to spend $15 per user per month on one of the competing storage plans could pay a similar amount for Microsoft’s Office service and get the storage plan thrown in.

At the same time, it seems like Microsoft’s change is largely a shift in marketing. A terabyte is a lot of storage, and most users probably would have been okay sticking to OneDrive for Business’s previous 25 GB cap on storage. Still, it means that businesses comparing specifications between different cloud services will be able to count Microsoft among companies that offer a massive amount of storage for a cheap price.

Update: Box CEO Aaron Levie posted the following response to Box’s blog after Microsoft’s announcement:

“The cloud is about breaking down walls between people and information. Not building a new set of islands in the sky.”

– John Case, Corporate Vice President, Microsoft Office Division

This was the closing remark on a recent Microsoft OneDrive blog post announcing new features titled, “Thinking outside the box.” While we haven’t always agreed with everything Microsoft has done, we completely agree with this view on cloud innovation. However, if Microsoft is to make good on *not* creating new “sets of closed islands in the sky,” then they need to drive for further openness in the ecosystem.

By keeping Office 365 users on the closed OneDrive “island,” Microsoft is stranding hundreds of millions of users and customers that have chosen Box, Dropbox, Google Drive, and others. And by releasing Office on the iPad without the ability to view or edit documents from any cloud service other than their own, they’re making it harder — not easier – for users to get the most out of their software.

Over the last four decades, Microsoft has built some of the world’s most important computing platforms. Many of these platforms — including Windows — succeeded because of their openness to third party applications and developers. In the Post-PC era, the enterprise software landscape has become far more heterogeneous, with most organizations using a litany of best-of-breed cloud solutions, including, Workday, Zendesk, MobileIron, Okta, GoodData, Domo, Google Apps, Office 365, Box, and many more. In this era, data should be free to move to the services that a customer chooses.

I’m personally excited by the revitalized and innovative Microsoft we’ve seen under Satya Nadella’s leadership. At Box, we believe in the power of the cloud to break down walls, and welcome the opportunity to work with Microsoft to make it a reality.

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