If you are using Microsoft OneDrive for Business standalone plans, you must prepare. This is because Microsoft is retiring the standalone OneDrive for Business Plan 1 and Plan 2. Don’t worry, nothing is happening to OneDrive or the data you keep on OneDrive. Only the standalone licensing options for OneDrive for Business are ending.
Microsoft has officially announced the retirement dates: no new purchases can be made after May 31, 2026, and the plans will be fully retired by December 2029. So you have time to make changes before the renewal timeline. But one main question is left. What should you do? Organizations have to move to another Microsoft 365 plan. Therefore, this guide explains the reasons for retiring the standalone plans and tells you what you should do to keep your data safe.
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What are OneDrive for Business Standalone Plans
Microsoft used to offer two separate OneDrive-only plans to businesses who did not want to fully commit to the Microsoft 365 ecosystem. These plans were mostly bought by businesses who required cloud storage and file management facilities without Outlook, Teams, or other Office 365 apps.
The difference between the standalone OneDrive plan and OneDrive included in Microsoft 365 is the licensing model. The standalone plan is licensed separately. But OneDrive with Microsoft 365 is part of a full subscription where you will get access to other Microsoft 365 services and applications.
There are two types of standalone OneDrive for Business plans with different features. OneDrive for Business Plan 1 is for basic file storage and sharing. OneDrive for Business Plan 2 is for needing additional storage and advanced functions. Below, I have created a table for easy comparison between the two standalone plans
| Feature | OneDrive for Business Plan 1 | OneDrive for Business Plan 2 |
| Used for | File storage, synchronization, and sharing | Basic storage with additional space and advanced functions. |
| Storage | 1 TB per user | Up to 25 TB per user |
| Advanced Features | Basic file storage + sharing | Advanced versioning, bigger file limits, better compliance |
| Target Users | Small teams, cost-conscious users | Larger organizations, heavy users |
These plans were very popular as they were much cheaper than equivalent M365 business plans. Even though you cannot use the Copilot + OneDrive combo in these plans, setting them up was easier than managing a big set of different apps. Moreover, companies were free to use other apps like Gmail/Slack, etc., and avoid vendor lock-in.
Now, all this is being changed; let us see the reasons for it.
Why is OneDrive for Business Standalone Plan Being Phased Out
The reason is simple: Microsoft makes more money on the full Microsoft 365 plans than it does on the OneDrive-only ones. Plus, managing two distinct types of Plans is not ideal from Microsoft’s point of view. For them, it’s better if everyone is under one umbrella when the umbrella is theirs.
Microsoft pitches this change as an opportunity and says that the full Microsoft 365 plans include Teams, Exchange, Copilot, and advanced security, which is a much better value for money.
However, no matter how many more apps Microsoft adds to the plan, a simple fact remains: the plans are more expensive than the OneDrive for Business Standalone variants.
Is OneDrive Being Discontinued?
No, the OneDrive service is not shutting down. The standalone plans of OneDrive offer for the business for only storing and sharing files have been discontinued. The OneDrive service will continue in Microsoft 365 licensing.
It is wise to be aware of when the closure is happening. So to help you out, I have prepared a timeline of the changes.
Timeline for the OneDrive Only Business Plans End of Life
OneDrive for Business standalone plans are not shutting off on a single date. Rather, it is a drawn-out process with features closing one by one until the full and final EOL.
- End of New Sales: May 31, 2026
- End of Renewal: January 2027
- Full Retirement: December 2029
Make sure you check the effective timelines from the Microsoft official announcement. They make changes to the timeline.
What Needs to Be Done Between the Timeline
Existing customers have plenty of time to move away from standalone plans. If you are already using standalone OneDrive for Business. The existing service is not immediately ended. It will continue until the applicable renewal or retirement.
After the renewal time period, your standalone plans will no longer be useful. Thus, you have to begin your planning and start the transition before the renewal. Here’s what you must do.
- First of all, find all the users who are currently assigned a standalone OneDrive for Business license.
- Find which standalone OneDrive for Business plan the users are using.
- Check the renewal or expiration date of their current subscription.
- Review each user’s OneDrive storage and how they are using it.
- Ask each user what they need for their storage services.
- According to their requirements, compare the replacement options.
- If needed, migrate your data. Before the full transfer, run a pilot migration for testing.
- Complete your process before the deadline.
Some businesses only need to change the licensing rather than data migration. If it is a license replacement, you can continue to use OneDrive for Business within the same Microsoft 365 environment. There would be no need to move files.
Replacement Options for Standalone OneDrive Plans
Every user has their own needs, so the replacement option is also different. But, to choose the best service, you have to consider some points like how much storage they need, whether they need Microsoft 365 applications, and other points.
For businesses, they have to decide whether they want to continue working with the Microsoft ecosystem or move to another cloud storage provider. If they want to continue with the Microsoft 365 business and enterprise plans, they can use the integrated OneDrive service.
But if they don’t want to work with Microsoft, there are several OneDrive alternatives like Google Drive, Dropbox, Proton Drive, pCloud, and many more. Also, when you are choosing another provider, you also have to migrate your OneDrive data. But if you are using the same OneDrive integrated with Microsoft 365, there is no need to transfer your data.
Want to Migrate OneDrive Data to Another Provider?
If you are staying with Microsoft 365, you don’t need to transfer your data. However, enterprises want to move OneDrive data between Microsoft 365 accounts. For this, SysTools OneDrive Migration Tool would be great for you. The software comes with a free demo where you can migrate multiple users’ data with file permissions. Download the tool on your latest Windows OS.
Frequently Asked Questions
Q: Is it still possible to renew the OneDrive for Business standalone plan?
Yes, for the time being, you have until January 2027 to renew currently active plans. No new plans will be available for sale after May 31, 2026.
Q: Will my files be deleted when the plan reaches EOL in 2029?
Microsoft does not delete your data immediately. If you refuse an upgrade and let your plan expire, your data goes through a specific step-by-step lifecycle. Grace period lasting 30 days, where the service continues as is, but you get bombarded with notifications.
Then comes the locked period, which lasts for 90 days. Here, Microsoft reserves the right to lock you out of your account until you switch to an available plan. If you let the lock-in period pass without any action, you enter the point of no return, where all of your data gets deleted with no recovery options.
Q: What is the cheapest, most cost-effective option to deal with the plan closure?
Depending on which plan you are on right now, here is what you should do:
Plan 1: Move to Microsoft 365 Business Basic for 1TB storage plus email and web apps.
Plan 2: Choose Office 365 E3 for 5TB+ storage and compliance features, or Microsoft 365 Business Premium for 1TB with advanced security.
Concluding Words
OneDrive for Business standalone plans are ending. Therefore, in this blog, I have explained the reasons to phase out, timeline of standalone ending, steps you must take during the timeline. Then, I provided the replacement options. If you are still using Microsoft 365, then there is no need to transfer your data. But if you are switching to different accounts, then you need to transfer the data. For this, I have provided a great software to easily transfer OneDrive data.