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Microsoft is retiring four standalone storage licenses—not SharePoint or OneDrive themselves. SharePoint Online Plan 1 and 2, plus OneDrive for Business Plan 1 and 2, will stop accepting renewals after January 2027. Existing contracts continue until they expire, and the services are scheduled for full retirement by December 2029.
That does not mean every customer must immediately buy an expensive Microsoft 365 bundle. Microsoft is steering customers toward Business and enterprise suites, but its announcement also identifies capacity packs and pay-as-you-go storage as possible alternatives. The right replacement depends on whether you need employee productivity tools, shared collaboration, archive storage, or backup capacity.
What Microsoft is actually ending
The affected standalone product families are:
| Service | Retiring plans |
|---|---|
| SharePoint Online | Plan 1 and Plan 2 |
| OneDrive for Business | Plan 1 and Plan 2 |
Microsoft is not ending SharePoint or OneDrive as services. Both remain included in many Microsoft 365 subscriptions. SharePoint continues to provide team sites, document libraries, permissions, lists, and collaboration features, while OneDrive remains primarily user-associated storage.
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That distinction matters. A 1 TB allowance in OneDrive is not operationally identical to a SharePoint team site. Moving files can change ownership, permissions, sharing links, synchronization behavior, retention, and governance.
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Microsoft says the retirement reflects low demand, unintended or nonstandard use, and the operating cost of maintaining standalone products. Its stated strategy is to make Microsoft 365 suites the primary way customers access SharePoint and OneDrive. The commercial effect is clear: the low-cost storage-only choice is disappearing, although Microsoft has not made a full productivity bundle the only stated route.
See Microsoft’s official retirement announcement.
The dates administrators need
| Date | What it means |
|---|---|
| January 28, 2026 | Microsoft announced the retirement. |
| May 31, 2026 | Last day for new tenants or customers to acquire the affected standalone plans. |
| June 2026 | End-of-sale phase begins. Existing customers may continue through the transition and may renew during this phase. |
| January 2027 | End of life: Microsoft will no longer renew the standalone plans. |
| December 2029 | End of service: the standalone offerings are fully retired, with existing contracts continuing until expiration. |
End of sale is not the same as immediate cancellation. A subscription expiring in October 2026 would generally continue until that expiration. January 2027 is the critical renewal-planning date, not an automatic shutoff date for every tenant.
Exact treatment can depend on the purchasing channel, contract type, geography, renewal date, and whether the subscription was bought directly, through a Cloud Solution Provider, or under an enterprise agreement. Check the agreement and obtain written confirmation from Microsoft or the reseller before changing licenses.
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How much could replacements cost?
The following are US list-price signals observed on Microsoft pages on August 18, 2026. They are annual-billing figures, not universal quotes. Microsoft displayed different Business Basic prices on different pages, and prices can vary by country, tax, billing term, Teams edition, reseller, and promotion.
| Plan | Observed price signal | What it provides |
|---|---|---|
| SharePoint Online Plan 1 | $5 per user/month | 1 TB per user; standalone plan being retired. |
| OneDrive for Business Plan 1 | $5 per user/month | 1 TB per user; standalone plan being retired. |
| Microsoft 365 Business Basic | $6 or $7 per user/month | OneDrive, SharePoint, email, web and mobile Office apps, and Teams in the applicable edition. |
| Microsoft 365 Business Standard | $12.50 per user/month | Business Basic capabilities plus desktop Office applications. |
| Business Standard without Teams | $9.29 per user/month | A no-Teams configuration shown on Microsoft’s comparison page. |
Check the live quote at Microsoft’s business pricing page and compare it with the OneDrive pricing page. Do not assume that the $6 or $7 figure applies in every market.
Which replacement fits?
Microsoft 365 Business Basic
Business Basic is the most natural conversion for a small organization whose users already need Microsoft email, web Office applications, Teams, and cloud collaboration. Microsoft lists 1 TB of cloud storage per user, along with OneDrive and SharePoint.
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The extra cost over a $5 standalone license may be modest, but it is still wasteful if the account exists only to hold an archive and nobody needs email, Teams, or Office applications.
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Microsoft 365 Business Standard
Business Standard adds desktop versions of Word, Excel, PowerPoint, and Outlook. It makes sense when employees need locally installed Office applications. It is difficult to justify solely as a storage replacement.
A no-Teams edition may reduce the price, but the available product, price, and feature combination depends on the market and purchase channel.
Enterprise suites
Microsoft points partners toward Microsoft 365 Business plans and, where appropriate, E3 or E5. Enterprise licensing can be justified by compliance, identity, security, device management, or large-scale organizational requirements. It is not a universal replacement for a storage-only license, and pricing commonly depends on the agreement, volume, region, and reseller.
Capacity packs and pay-as-you-go storage
Microsoft’s retirement notice also names capacity packs and pay-as-you-go storage as possible routes. These options deserve particular attention when a small number of users hold a large archive or when an organization needs to preserve SharePoint sites without licensing every data holder for a full productivity suite.
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- This USB drive provides plug and play simplicity with the included 18 inch USB 3.0 cable
- The available storage capacity may vary.
Microsoft does not provide one universal replacement matrix in the retirement notice. Confirm the exact capacity product, eligibility, billing method, and geography-specific price in your tenant before relying on it.
The archive problem
Some organizations used OneDrive licenses as inexpensive archive accounts, backup destinations, or service accounts. Replacing every one with Business Standard can multiply costs without adding useful capabilities.
Before choosing a replacement, separate:
- Active employee files that belong in OneDrive.
- Shared working documents that belong in SharePoint libraries or Teams-connected sites.
- Long-term archives and read-only data.
- Backup copies that may be better suited to storage-oriented services.
- Service-account data and automated workflows.
Possible routes include retaining data in Microsoft storage through a capacity or pay-as-you-go option, moving shared content to an appropriately governed SharePoint site, reducing stale versions and duplicates, or evaluating another provider. A dedicated storage service may be cheaper for backup or archive workloads, but it will not automatically reproduce Microsoft permissions, Office coauthoring, retention policies, or end-user sharing.
Do not treat OneDrive and SharePoint as interchangeable
OneDrive is primarily associated with an individual user. SharePoint is structured around sites, libraries, shared ownership, permissions, and organizational collaboration. A migration from one to the other can affect:
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- File ownership and access when an employee leaves.
- Existing sharing links and guest access.
- Sync behavior and users’ folder paths.
- Retention, legal hold, and version history.
- Power Automate flows, forms, lists, and Teams-connected content.
- Service accounts and automation identities.
Do not move files merely because both products advertise a 1 TB allowance. First document who owns the data, who needs access, how long it must be retained, and which applications depend on it.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What administrators should do now
- Inventory licenses. In the Microsoft 365 admin center, identify every SharePoint Online Plan 1 or 2 and OneDrive for Business Plan 1 or 2 subscription.
- Record renewal information. Capture the expiration date, monthly or annual billing term, purchasing channel, reseller, and any larger agreement containing the license.
- Map actual usage. Classify each license as employee storage, team collaboration, archive, backup, service account, or externally shared content.
- Measure storage realistically. Include versions, recycle bins, retention-related data, and inactive sites—not just the visible file total.
- Separate active data from archives. Do not buy a full productivity suite for dormant data without comparing storage-specific options.
- Price at least three scenarios. Compare Business Basic; Business Standard or an enterprise plan where genuinely needed; and Microsoft’s capacity, pay-as-you-go, or an external storage option.
- Pilot the change. Test permissions, external sharing, links, sync, workflows, retention, and service accounts in a non-production or pilot environment.
- Document deletion consequences. Microsoft’s plan comparison warns that associated data may be deleted when a subscription is canceled. Confirm retention and deletion rules before cancellation.
- Schedule the transition. Aim to complete the decision before the January 2027 no-renewal milestone rather than treating December 2029 as the planning deadline.
What happens if you do nothing?
Nothing necessarily stops on January 1, 2027. Existing contractual service is expected to continue until the subscription expires. The immediate risk is reaching renewal with no approved replacement, no tested migration, and no confirmed treatment for archive or service-account data.
Waiting until the December 2029 end-of-service date also creates avoidable risk. A license may expire earlier, a reseller may require a decision during an earlier renewal cycle, and a rushed migration can break links, workflows, permissions, or retention controls.
Alternatives outside Microsoft
If you need storage only, evaluate the workload rather than looking for a one-for-one product name:
- Google Workspace, Dropbox, and Box are collaboration and content platforms, not simple storage buckets.
- Dropbox Business may suit file synchronization and collaboration workflows.
- Box and Egnyte may be relevant when content governance and compliance are priorities.
- Backblaze B2 and Wasabi are more storage-oriented and may suit backup or archive workloads, but they require different sharing, backup, and application workflows.
These products are not direct substitutes in every case. Their current prices were not established here, so obtain a current quote before comparing total cost.
The bottom line
Microsoft is removing standalone SharePoint Online and OneDrive for Business Plans 1 and 2, not shutting down SharePoint or OneDrive. New customers were cut off after May 31, 2026; standalone renewals end after January 2027; and full service retirement is scheduled for December 2029.
For employees who already need Microsoft email and Office, Business Basic or Standard may be a practical upgrade. For archive, backup, read-only, service-account, or storage-heavy workloads, automatically buying a full bundle may be poor value. Inventory the tenant, identify the real workload, compare storage-specific routes, and test the replacement before the affected subscription reaches renewal.
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