Microsoft 365 Shrinks Your Cloud Storage — Get Ready to Pay More

Microsoft just announced a big change to its Microsoft 365 Personal, Family, and Premium subscriptions. Right now, if you have a Family plan, each of up to six people gets 1TB of OneDrive storage — that's 6TB total. After the change, the whole family will share a single pool of just 2TB. That's a huge cut. If your family uses more than 2TB, you'll have to pay for extra storage: $10 a month for each additional 1TB. So a plan that costs $130 a year could easily double or triple in price.

The change is meant to stop people from abusing the old system. Some users were creating extra accounts to hoard massive amounts of data — like backing up entire movie collections. Microsoft says the new shared storage pool will make things fairer. But for normal families who store lots of photos, videos, and documents, it's a painful squeeze. The AI part is a bit better: Copilot credits will become shareable among family members, and the owner can manage access for kids.

The timing matters. New subscribers will get shared storage starting October 8, 2026. Existing subscribers will switch at their first renewal on or after May 2, 2027. Microsoft says it will notify customers in advance. If you're a heavy user, you have time to clean up files or find another storage option. But the days of cheap, plentiful cloud storage for families are clearly ending.

This isn't the first time Microsoft has pulled back on storage promises. In 2014, it offered unlimited OneDrive storage, then reversed course a year later, blaming a few users who stored over 75TB each. So if you rely on Microsoft 365 for your family's digital life, start planning now — or prepare to pay up.