Microsoft Auto-Archives Unlicensed OneDrive Accounts

Microsoft 365 Archive, previously a SharePoint essential, now turns its attention to OneDrive! Microsoft’s new Archiving feature, meant for long-term storage of inactive content, is now charging you for storing unlicensed OneDrive user accounts. Yes, Microsoft throws a bombshell: updating its storage policies of unlicensed Microsoft OneDrive accounts, which could empty your wallet if left unnoticed! Let’s dive into the details below!

Starting from late January to March 2025, any OneDrive accounts left unlicensed for more than 90 days will be automatically archived, hitting you with extra costs to regain access. (Message Center ID: MC836942)

For instance, a OneDrive account that became unlicensed on September 5, 2025, will be inaccessible to users by November 5, 2025. While admins can view these accounts, users won’t regain access until admins act.

This update affects only business and enterprise customers. Educational tenant customers, you’re in luck—you’re exempt from this change!

To avoid emptying your wallet, identify unlicensed OneDrive user accounts and take action—either renew or delete them—before January 27, 2025!

There are several reasons why a OneDrive account might be unlicensed, like an expired Microsoft 365 subscription or license removal. Yet, that isn’t your tension! Microsoft provides you with the list of all unlicensed OneDrive accounts, the storage used, and the reasons they became unlicensed. Here’s how to find the unlicensed OneDrive user accounts:

SharePoint admin center > Reports > OneDrive accounts

Here are the four main reasons:

• Retention period – Sometimes, an account is no longer licensed but stays active because a retention period setting prevents it from being deleted.
  
• Retention policy – Similarly, an account might remain active without a license due to a retention policy in Purview keeping it from being deleted.
  
• Active user with no license – This situation arises when a user’s license is removed but their account in Entra ID is not deleted.
  
• Duplicate accounts – A licensed user may have multiple OneDrive accounts associated with them, creating duplicate or non-primary accounts. This can occur due to geographic moves, employee rehires, or other factors.

Note: Only a few admins will have access to this page starting July 26, 2024. For others, access will be granted closer to August 16, 2024.

Okay, so you know how to find unlicensed accounts in OneDrive that aren’t being paid for! Now, Slet’s talk about what happens if you leave them alone.

If an account has been unlicensed for over 90 days, you won’t be able to access it until you meet a few requirements. Here’s what you need to do to get back in.

To store the unlicensed account, you need to set up a special place called a Microsoft 365 Archive. This is where old company data of SharePoint Online and OneDrive gets stored. Before setting up Microsoft 365 archive, make sure to have a look at the prerequisites:

1. An Azure subscription linked to Syntex
2. Global admin or SharePoint admin permissions.
3. Enable Microsoft 365 Archive Unlicensed Account billing (billing is available starting April 2025).

If you enable unlicensed account billing, it’ll be applied to all unlicensed OneDrive accounts in your tenant. Then it’ll be a monthly ritual to pay the amount to store the contents. After all, nothing’s truly free! Once enabled, admins can perform the below actions:

1. Set up archive billing for unlicensed accounts.
2. If there’s no retention policy in place, you can delete the unlicensed OneDrive account.
3. Keep access active by renewing the account.

But all comes with a cost, so here’s a clear breakdown:

• Storage Costs: You should pay $0.05/GB/month to store unlicensed OneDrive content in the Microsoft 365 archive.

• Restoration Costs: Need to restore content? That’ll cost you $0.60 per GB to reactivate accounts stored in the Microsoft 365 Archive.

Note: Well, here is where Microsoft goes the extra level and charges you! Once restored, a OneDrive account will be available for just 30 days. If you need access beyond that, you’ll have to pay again. The account will be reactivated within 24 hours, but you’ll need to shell out more if you want to extend access or retrieve data after the 30-day window.

It’s a bit of a pay-as-you-go scenario that some people say feels like Microsoft is upselling every feature! 🙁

What Does This Mean for You?

So, Microsoft’s new storage policies for unlicensed Microsoft OneDrive accounts are basically a bomb for your budget. By automatically archiving unlicensed OneDrive accounts and slapping on extra fees for storage and retrieval, they’re adding a new layer of complexity

Is this a strategic move to maximize revenue, or help customers retain old data? Only time will tell. But one thing’s for sure: it’s time to care about the uncared unlicensed OneDrive accounts too!