The Race To Ubiquitous, Free Cloud Storage

Two interesting things happened today in the realm of cloud storage: Microsoft cut its prices for OneDrive and gave out more free gigabytes, and Box took its editing tool Box Notes mobile.

Both fit neatly into the current market arc relating to cloud storage: The price per gigabyte for consumers and customers is going to zero, and storage companies are looking to diversify their productivity offerings on top of their storage stacks.

It’s worth marking this moment, as it crystallizes the trends we are currently seeing in storage.

The marginal price of cloud storage for the average consumer is dropping quickly, which means that what companies can charge for a gigabyte of cloud storage is low and will continue to fall. Soon, cloud storage will be both ubiquitous and free for consumers. Given that platform companies must compete, we’ll see free, unlimited cloud storage from major players as a sort of table stakes for online services.

Even if you can’t charge for storage, you can charge for what consumers can do with their data. So, if you have to eat the rapidly declining closet of cloud storage, what do you do? You extend your value stack. Hence Box Notes for mobile.

Within two years, consumers will have several options for unlimited, free cloud storage. That’s to say that they will have a few terabytes to play with from a number of providers. The idea that consumers should only have access to a few gigabytes of free storage will quickly become as silly as the idea that an email account only needed a few megabytes of capacity.

2004, via CNET:

Hotmail currently offers 2MB of free e-mail storage. Yahoo offers 4MB. Gmail will dwarf those offerings with a 1GB storage limit.