Microsoft to freeze unlicensed OneDrive Business accounts and charge for restoring them

Microsoft announced some important changes for OneDrive Business customers. In just a few months, the company will start "archiving" unlicensed and unmanaged accounts within companies. According to the official documentation published on the Microsoft Learn website, unlicensed accounts "pose security and compliance risks," so the company plans to freeze those accounts and charge for their restoration:

Beginning January 27, 2025, any OneDrive user account that has been unlicensed for longer than 90 days becomes inaccessible to admins and end users. The unlicensed account is automatically archived, viewable via admin tools, but remains inaccessible until administrators take action on them."

For reference, by "unlicensed," Microsoft means unactivated accounts, expired accounts, or accounts that are not connected to a Microsoft or Office 365 subscription inside an organization.

IT admins who detected unlicensed accounts within their organizations will have several options to choose from. They can assign a license to such accounts, delete them, or archive them. Untouched accounts will be archived automatically.

The archiving option will let users keep the contents of their OneDrive accounts, but getting that info back will require paying Microsoft a fee of $0.05 per gigabyte per month and an extra $0.60 per gigabyte. According to the documentation, billing for Microsoft 365 Archive Unlicensed Accounts will be available starting April 2025.

Administrators can detect unlicensed OneDrive accounts by doing the following:

1. Sign in to the SharePoint admin center with your work or school account.
2. Go to Reports and select User reports.
3. Under OneDrive usage, select Unlicensed users.
4. You can download the report as a CSV file.

Microsoft also promises to release an interactive UI for checking usernames and extra details of unlicensed OneDrive accounts somewhere in January 2025.

You can find more information about unlicensed OneDrive accounts and what will soon happen to them in the official documentation (via Petri).