Summary
Microsoft is retiring all four standalone SharePoint Online (SPO) and OneDrive for Business (ODB) plans. No new customers will be able to purchase them after May 2026, renewals will stop in January 2027, and the plans will be fully retired by December 2029. If your organisation uses these plans, you will need to move to a Microsoft 365 suite or find alternative storage options.
SharePoint Online Plan 1 ($5/user/month) and Plan 2 ($10/user/month) are both affected
OneDrive for Business Plan 1 ($5/user/month) and Plan 2 ($10/user/month) are both affected
End of Sale (no new purchases) is June 2026, End of Life (no renewals) is January 2027, and End of Service (service ends) is December 2029
Microsoft's recommended alternatives are Microsoft 365 suites, capacity packs, and pay-as-you-go (PAYG) storage, but Microsoft has not published capacity-pack details or a replacement PAYG storage product for standalone-plan customers
What Microsoft Said
In its January 2026 Partner Center announcement, Microsoft explained the retirement as follows: "Microsoft is evolving its cloud storage and collaboration offerings and is retiring the standalone SharePoint Online (SPO) plan 1 and plan 2 and OneDrive for Business (ODB) plan 1 and plan 2 SKUs. This change reflects low customer demand for standalone offerings, increased instances of unintended or nonstandard usage, and higher operational costs associated with maintaining these plans".
Plan 2 was already quietly disappearing from Microsoft's own web pages before this announcement. SharePoint Online Plan 2 was removed from the SharePoint pricing page between June 2023 and September 2023. OneDrive for Business Plan 2 was removed from the OneDrive service description between December 2024 and November 2025. Plan 1 for both products is still listed on Microsoft's pricing pages as of May 2026.
The announcement has not appeared on Microsoft Licensing News as of May 2026 and remains a Partner Center advisory only. Meanwhile, the Microsoft 365 plan options service description still lists all four plans as standalone options.
The Timeline
Milestone | Date | What it means |
|---|---|---|
Announcement | 28 January 2026 | Partner Center advisory |
End of Sale | June 2026 | No new customers after 31 May 2026. Existing customers can still renew. |
End of Life | January 2027 | No more renewals. Existing contracts continue until they expire. |
End of Service | December 2029 | All standalone plans fully retired. Service ends. |
Source: Partner Center January 2026 announcements
What Are You Losing
The four retiring plans provided storage at $5–$10 per user per month.
Plan | Price | Storage |
|---|---|---|
SharePoint Online Plan 1 | $5/user/month | 1 TB tenant base + 10 GB per user to tenant pool, plus 1 TB OneDrive per user |
SharePoint Online Plan 2 | $10/user/month (historical) | Same as Plan 1, plus expandable OneDrive storage (1 TB default, expandable to 5 TB, then to 25 TB via support request) |
OneDrive for Business Plan 1 | $5/user/month | 1 TB per user |
OneDrive for Business Plan 2 | $10/user/month (historical) | "Unlimited individual cloud storage" (1 TB default, expandable to 5 TB, then 25 TB via support request) |
Sources: SharePoint Online current pricing, SharePoint Online Plan 2 historical pricing, OneDrive for Business current pricing, OneDrive for Business Plan 2 historical pricing, historical OneDrive service description
The Plan 2 prices are historical because both Plan 2 products were removed from Microsoft's web pricing pages before the retirement announcement (see above). The Plan 2 storage descriptions are also historical. The "Unlimited" storage tier that was available in the OneDrive for Business Plan 2 is no longer listed in the current OneDrive service description.
There is no replacement offering that matches the historical Plan 2 storage allocation. Microsoft 365 E3 and E5 offer 1 TB of OneDrive storage expandable to 5 TB per the current OneDrive service description, but the 25 TB tier and "Unlimited" description are gone.
Microsoft's Recommended Alternatives
The January 2026 announcement listed three categories of alternatives:
Microsoft 365 suites (Microsoft 365 Business Basic, Business Standard, Business Premium, E3, E5)
Capacity packs
Pay-as-you-go storage options
Microsoft stops new sales on 31 May 2026, but only one of its three named alternatives — moving to a Microsoft 365 suite — has published pricing. Capacity packs and pay-as-you-go remained undefined four months after the announcement.
The first option exists and has clear pricing. Microsoft has not published capacity-pack pricing or a new replacement PAYG offering for standalone-plan customers, and that creates a practical problem for customers trying to plan their transition.
The Cost of Moving to a Suite
The tables below compare the cost of standalone plans against the Microsoft 365 suites that replace them.
Suite prices below reflect the July 2026 Microsoft 365 price increase published in the Microsoft 365 Packaging and Pricing Updates. The OneDrive for Business Plan 1 price ($5/user/month) is current published pricing and is not part of the July 2026 update.
The Frontline Worker Problem
Organisations that license frontline workers with Microsoft 365 F1 or Microsoft 365 F3 get only 2 GB of OneDrive storage per user. Organisations that purchased standalone OneDrive for Business Plan 1 as a low-cost way to give frontline workers usable cloud storage are directly affected.
Here is what the alternatives cost after retirement, using post-July 2026 suite prices:
Alternative | Price per user per month | OneDrive storage | Notes |
|---|---|---|---|
Keep F1 or F3 (no change) | F1: $3, F3: $10 | 2 GB | Default storage unchanged, but no standalone ODB bolt-on available |
Move to Office 365 E1 | $10 | 1 TB | Listed with no July 2026 price increase. See feature comparison below. |
Move to Microsoft 365 E3 | $39 | 1 TB+ | +290% vs F3 alone, +160% vs F3 + ODB Plan 1 combined |
Move to Microsoft 365 E5 | $60 | 1 TB+ | +500% vs F3 alone |
Capacity packs or replacement PAYG | TBD | TBD | No replacement product or pricing published (see below) |
Sources: Microsoft 365 Packaging and Pricing Updates (post-July 2026 suite prices), Microsoft 365 F1, Microsoft 365 F3, Office 365 E1, Microsoft 365 E3, Microsoft 365 E5 (product pages show pre-July 2026 list prices), OneDrive for Business Plan 1 (current pricing; not part of the July 2026 update)
What an Organisation with 1,000 Frontline Workers Would Pay
Using the table above, with F3 at its post-July 2026 rate ($10) plus OneDrive for Business Plan 1 at current pricing ($5) as the baseline:
F3 + ODB Plan 1: $15,000 per month
Office 365 E1: $10,000 per month (but see what you lose below)
Microsoft 365 E3: $39,000 per month
Office 365 E1 is cheaper than the F3 + ODB Plan 1 combination and delivers 1 TB of OneDrive storage.
F3 vs Office 365 E1: What You Lose
Moving from Microsoft 365 F3 to Office 365 E1 increases OneDrive storage from 2 GB to 1 TB but removes several components.
Feature | Microsoft 365 F3 | Office 365 E1 |
|---|---|---|
OneDrive storage | 2 GB | 1 TB |
Shifts | Yes | Yes |
Viva Learning | Yes | Yes |
Viva Engage | Yes | Yes |
Viva Insights | Yes | Yes |
Viva Connections | Yes | Not listed on product page |
Power Automate for Microsoft 365 | Yes | Yes |
Windows licence | Yes | No |
Intune (device management) | Yes | No |
Information Protection | Yes | No |
Entra ID P1 | Yes | No |
Sources: Microsoft 365 F3, Office 365 E1, Microsoft Entra ID licensing (confirms Entra ID P1 is included with Microsoft 365 F1 and F3; E1 includes only the free tier)
Office 365 E1 costs less than Microsoft 365 F3 plus standalone OneDrive and lifts OneDrive storage from 2 GB to 1 TB — but it drops Intune, the Windows licence, and Entra ID P1.
Office 365 E1 retains the collaboration features (Shifts, Viva, Power Automate) but does not include Intune, Azure Information Protection, Entra ID P1, or the Windows licence entitlement. If your organisation manages frontline devices through Intune and relies on the Windows licence, switching to E1 removes those components.
Existing Storage Options
Office 365 Extra File Storage
Additional SharePoint storage purchased in 1 GB increments via the Microsoft 365 admin centre. Microsoft has not published official list pricing for this add-on. The figures below come from non-authoritative sources: the annual price of $0.20 per GB per month is stated by a Microsoft moderator in a learn.microsoft.com Q&A thread, and the monthly commitment price of $0.24 per GB per month is listed on secureframe.com, a third-party marketplace.
There is one important limitation. This add-on is available for direct purchase only through the Microsoft 365 admin centre. Customers with volume licensing or Cloud Solution Provider (CSP) subscriptions cannot buy directly from Microsoft and must go through their representative or partner.
Microsoft 365 Archive
Cold storage for inactive SharePoint sites. Microsoft prices archive storage at $0.05 per GB per month, but charges apply only when archived plus active SharePoint storage exceeds the tenant's included or licensed SharePoint storage capacity. Reactivation has been free since 31 March 2025, but there is a 4-month restriction before a reactivated site can be archived again.
Unlicensed OneDrive Account Handling
When a OneDrive for Business licence is removed from a user, the account does not disappear immediately. It goes read-only at day 60 and is archived at day 93. If pay-as-you-go billing is enabled on the tenant, the account remains archived and is not deleted; archived OneDrive storage is billed at $0.05 per GB per month, and reactivation costs $0.60 per GB. Access to archived data requires reactivation. If pay-as-you-go billing is not enabled, the standard deletion process begins.
This enforcement has been active since January 2025 and does not apply to education, GCC, or DoD tenants.
SharePoint Storage Pool
Standard SharePoint plans use a pooled storage model: 1 TB base plus 10 GB per licensed user. There are exceptions. Microsoft 365 F1, F3, and Office 365 F3 receive 1 TB total tenant storage, and standalone OneDrive plans contribute only 0.50 GB per licence to the tenant storage limit.
What Microsoft Promised but Has Not Delivered
The January 2026 announcement mentioned several alternatives and tools that, as of May 2026, have not materialised or been confirmed.
Capacity packs. Microsoft mentioned "capacity packs" and "more storage options" in the announcement. No details, pricing, or product pages have been published as of May 2026, four months after the announcement.
Pay-as-you-go storage. The announcement referenced pay-as-you-go storage options as an alternative for standalone plan customers. No new SharePoint storage PAYG meter, capacity-pack structure, or per-user OneDrive PAYG alternative has appeared. The existing Microsoft 365 Archive and unlicensed OneDrive PAYG billing (described above) are separate products, not replacements for standalone plans.
Cloud Ascent. Microsoft said Cloud Ascent would be updated "by the end of February" to give partners visibility into impacted customers. There has been no public confirmation that this update happened.
Plan 2 storage replacement. OneDrive for Business Plan 2 historically offered "Unlimited individual cloud storage", which in practice meant 1 TB expandable to 5 TB, then to 25 TB via support request. The current OneDrive service description for E3 and E5 offers 1 TB expandable to 5 TB only. The 25 TB tier and the "Unlimited" description are gone, and no replacement offering matches the historical Plan 2 allocation.
If you need help planning your transition from standalone plans, get in touch. We don't sell Microsoft licences or cloud services, so our advice is independent.