What's changing?
Microsoft is changing the storage model for its Microsoft 365 Family, Premium and Pro plans. Until now, each user was assigned 1TB of cloud storage individually; under the new setup, all users will share a single 2TB pool.
The change takes effect on subscription renewals after May 2, 2027. Subscribers who switch plans earlier may see the new model sooner.
Who is affected?
For a subscription shared across six people, total capacity falls from 6TB to 2TB — a 66.6% cut. The new model can work well for accounts where a single heavy user consumes most of the storage, but households with four users at 500GB each may need to buy extra capacity. Additional storage starts at $1.99 per month for 200GB.
Microsoft says it has not raised subscription prices. According to the company, the change is meant to let unused storage benefit the whole family and reduce the chance of individual users hitting personal limits. Some affected subscribers may receive bonus storage during the switch, though eligibility requirements were not disclosed.
An industry-wide storage crunch
The move appears to be a response to a broader storage shortage. According to the source, hard drive prices rose 46% from September 2025 to January 2026; 30TB enterprise SSDs now cost as much as $22,600, with supply sold out until 2027. Google has also cut its free cloud storage limit from 15GB to 5GB, while Backblaze, which advertises "unlimited" backups, updated its terms of service to potentially throttle or terminate accounts that exceed typical usage patterns.
