How do you deal with the unreasonable storage limits in SharePoint Online?!

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How do you deal with the unreasonable storage limits in SharePoint Online?!

I had a great question come in from a long-time reader recently:

As I begin my journey to move clients from on-prem file servers to SharePoint/Teams, I keep getting hung up on the storage allocation.  1TB for an organization + 10GB/user is so far behind the times of what other vendors are doing.  I’m not suggesting that they should offer terabytes and terabytes but their current model just sucks.  The biggest sticking point is the $.20/gb add on. That is absurd by today’s standards. What are you doing for customers who have more data than they can bring to the [Microsoft] cloud?


Good question, David. And it is honestly one that I am surprised hasn’t come up before in my comments or elsewhere on the blog. Because I too have customers who have made sour faces when we explain the limitations and additional costs to them. For those who are not aware, SharePoint Online has some of the most expensive cloud storage on the market currently, at $0.20 / GB / month. That’s like ~$200.00 USD / month for every terabyte over your base allotment (1 TB + 10 GB / licensed user).

For Enterprise orgs with thousands of users, that extra 10 GB / user included with your subscriptions adds up quick, and could be enough to cover your needs in very many cases. For example, multiply that out by 5,000 users and you will find that you have a ton of storage to play with. But for the SMB… this is not a very good deal. For example a 50 person organization gets an additional 500 GB, for ~1.5 TB total. But many small orgs could easily have several terabytes of historical/archive data that they want to put into the cloud for better searchability, security, compliance, etc. And yet, the average SMB is not going to spend that kind of dough to put their data into the cloud. They’d sooner go with a competing solution like DropBox or ShareFile.

I have to imagine they will fix this eventually. Honestly, I fully expected to hear at Ignite last year that the default storage quotas would be increased with subscriptions across the board, when they announced support for large files of 100 GB. But nope. So I guess with that hot new feature I am allowed to store 10 such files. Wow.

To be fair, OneDrive for Business (a personal storage location) is included in your licensing as well, and has decent storage quotas by comparison–each user has a 1 TB quota all to themselves right out of the gate on any major Business subscription, but you can increase this to 5 TB / user with certain qualifying Enterprise subscriptions.

Most users do not even come close to using the first 1 TB anyway–how I wish we could trade some of that extra capacity for more SharePoint storage!

What to do about it

So there are really only a couple of ways around this issue. It all starts with deciding what is active data, and what is considered merely archive/historical. Active data should be brought into SharePoint locations such as Teams channels, or SharePoint sites as described in this article. This is the ideal place for active working files so that you can get the benefits of having all your collaboration, email, chat, etc. together in a common platform with strong security & compliance controls.

Then, as regards archive data, you have these options:

  1. Push archive data into its own OneDrive account*–like a separate “Archive” account, and share data out from there as needed to others
  2. Use an alternative cloud-based solution (non-SharePoint)
  3. Stay on-prem with archive data and do not bring it to the cloud

I know, I bet you were wishing I had like a secret magic trick here, but nope. The OneDrive thing is about the only workaround I know of. Hopefully they come up with some better options for the SMB folks with very few users soon (since I agree, $200/TB is highway robbery by today’s standards).

I have two suggestions:

  1. SMB plans should just have a higher quota (e.g. 1 TB + 30, 40 or 50 GB/user or 5 TB base + 10 GB/user)
  2. Have an add-on storage option that is only available to SMB tenants with fewer than 300 licensed users–maybe with more reasonable cost like $20/month for a terabyte instead of $200.

*To adjust your default OneDrive quota from 1 TB to 5 TB per user, be sure to follow the steps in this article, and also be sure that the user account you are targeting is assigned one of the qualifying plans (such as E3 or OneDrive for Business Plan 2).

Comments (7)

  • Ivan Reply

    I suspect the best solution for this, considering a cloud first approach, and keeping within the Microsoft ecosystem, will probably be Azure File Storage. A quick Google search revealed several 3rd party plugins to achieve this, but there might be native capabilities to achieve that, or at least, there should be. In the old SharePoint on premises, we could easily index a file share on a local server and expose that data within SharePoint.

    April 29, 2020 at 12:41 pm
  • Tracy Ratz Reply


    Not going to defend Microsoft but my thinking is that since the backend is sharepoint. Sharepoint if you ever ran it on prem isn’t the easiest to add storage to it. The one benefit of sharepoint is the collaboration and sharing of files. One other solution that you didn’t include provided you do not need the collaborative features of sharepoint is azure files. Storing data there is signficantly cheaper than using sharepoint and will access data similar to an on prem solution.


    April 29, 2020 at 9:51 pm
    • Alex Reply

      Ah yes but I did include that–“alternative cloud-based solution (non-SharePoint)” would include Azure Files. But honestly we show this solution and people still prefer ShareFile or DropBox over it as of today.

      April 30, 2020 at 10:35 am
  • Mr Nigel Reply

    You state “…announced support for 100GB files”. When will that be a reality? And yes I do have a use case in the oil sector ;-)

    April 30, 2020 at 3:00 am
  • Hal Sclater Reply

    Working at a small company with 400 E3 and also 270 dynamics users. So they get 7.7TB across teams and sharepoint, it’s a decent amount but yes the cost per TB on top of that concerns me.

    April 30, 2020 at 3:25 am
  • Scott Reply

    We wanted to fully move away from Dropbox to Sharepoint, but sadly couldn’t do that. We migrated most of our data but left 10 users active and pay $3000 a year for those users. We were running out of storage in Dropbox for the 7 (yes 7!) remaining enterprise users that we were actively being used. We called them and they immediately gave us an additional 50TB of storage for no cost. Really microsoft, this makes you look completely silly.

    So now I’m paying Dropbox $3000 a year for approximately 120TB of storage.

    March 4, 2022 at 4:34 pm

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