If your SharePoint is over its storage allowance, you have three options: keep paying Microsoft’s extra-storage charge, move old files into Microsoft 365 Archive, or hand them to a third-party archiving tool. This is a straight Microsoft 365 Archive vs third-party archiving comparison: what each costs in 2026, where Microsoft’s own tier wins, and the catches that decide whether your old files should stay inside Microsoft or move somewhere cheaper. Check one catch early: content you reactivate can’t be archived again for four months.
What Microsoft 365 Archive is
Microsoft 365 Archive is a cold-storage tier built into Microsoft 365. It began as a site-level feature. You archived an entire SharePoint site, and that site went dormant. It now supports file-level archiving, so single documents can move to the archive tier while the site stays live. Microsoft’s documentation says file-level archiving is on by default once Microsoft 365 Archive is enabled, and archived content remains searchable.
Archived data still lives in Microsoft’s storage and is billed at a lower rate, covered below. Retrieval is the compromise. An archived file must be reactivated before it opens normally, so access takes longer than for a file that never moved. For files nobody touches, such as the 2021 finance exports, that’s fine. For anything you might need on a Tuesday afternoon, it matters.
The pricing: US$0.05/GB/month, and when it’s cheaper
Microsoft 365 Archive charges US$0.05 per GB per month for archived storage. That meter runs only when your archived and active storage combined exceeds your licensed allowance. If you’re still under it, archiving costs nothing extra. Microsoft’s pricing documentation sets out all five billing scenarios.
Take 3 TB of old files above your allowance. Left on the Office 365 Extra File Storage add-on at US$0.20/GB/month, that costs roughly US$614 a month. Moving the same 3 TB into Microsoft 365 Archive at US$0.05/GB/month cuts it to about US$154 a month, a quarter of the extra-storage cost. Cheaper cloud storage takes it lower again. Our management rate is US$24 per terabyte a month before tax, with your own storage provider billing you directly at its own list price. If we run the storage, it’s US$35 per terabyte a month all-in. The gap grows with your data. Microsoft charges in US dollars, so its figures in other currencies here are estimates.
Doing nothing means paying about US$0.20 per GB per month for the add-on, though the price varies by region and purchase channel. Microsoft 365 Archive is roughly four times cheaper than the extra-storage charge for the same data. That’s a worthwhile saving, and it suits organisations where:
- You’re only a little over your allowance and don’t want another supplier.
- The archived files are rarely needed, and you can live with the reactivation delay.
- Everything must stay inside Microsoft’s compliance and eDiscovery boundary.
For those organisations, the built-in tier is a sensible, low-effort choice. But being four times cheaper than Microsoft’s extra-storage charge doesn’t make it the cheapest place to keep old files.
The catches: the four-month lockout, no way out, and OneDrive
The built-in tier has three awkward limits. Any one may be manageable. Together, they decide whether Microsoft 365 Archive fixes your storage problem.
1. The four-month re-archive lockout
Microsoft removed the per-GB reactivation fee for SharePoint archives on 31 March 2025. Good news. But once archived content is reactivated, you can’t archive it again for four months. A reactivated site or file stays in active storage and counts against your allowance at the full rate for that whole time. If access comes in bursts, perhaps for quarter-end reporting or an audit that reopens old material, the lockout can erase the saving.
2. Your cold files stay on Microsoft’s storage, with no way out
Archived data never leaves Microsoft’s storage. You can’t point the archive at your own storage or a cheaper provider, and you don’t get a portable copy to take elsewhere. The cost of your old files stays tied to Microsoft’s per-GB rate and your licence count. That’s fine until the rate changes or your data grows faster than your licences do.
3. OneDrive is treated differently
The removal of reactivation fees applies only to SharePoint. Microsoft’s pricing documentation says archived, unlicensed OneDrive accounts are still billed per GB when reactivated. That matters if former employees’ accounts are part of the storage problem.
When third-party archiving wins
Third-party archiving tools, including ArchiveBridge, work differently. They move old files out of Microsoft into cheaper cloud storage, then leave a small link file in SharePoint that points to the new location. That changes both the cost and the control you have over the archived files:
- Plain cloud storage costs much less per GB. You can bring your own S3-compatible storage at its published rate and pay the archiving vendor for management only. There’s no storage markup, and no dependence on Microsoft’s allowance maths.
- The data leaves your SharePoint allowance. After the stored copy has been checked and the original removed, the file stops counting against your SharePoint pool, at US$0.05 or any other rate. The exception is a site under a Microsoft retention policy, because Microsoft keeps its own copy of deleted files until the policy period ends.
- No re-archive lockout. A restored file can age out again on your schedule. There’s no four-month wait.
- Each copy is checked. Before deleting anything, a sound archiving tool compares the stored copy with the original and records the result. ArchiveBridge reads each copy back and requires its SHA-256 fingerprint to match the original’s. If the fingerprints don’t match, the file stays in place and is flagged for review. We wouldn’t trust a move-then-delete process without that check. See how each file is checked before removal.
- There’s a real exit path. Copies are stored as ordinary files under their original names and folder paths, and any S3 tool can read them. If you use your own storage, the copies are already yours. If we run the storage, you have three choices. Restore everything to SharePoint. Or we hand you the admin details of that storage account, and you keep paying for it or move the files to an account of your own. Or we delete it on request. Restores back to SharePoint are never charged, one file or everything, in bulk too, with no yearly limit. Only a full export to storage outside ArchiveBridge is quoted, and only after you approve the quote. The link files need ArchiveBridge to work, so restore before you leave.
There are costs on the other side. A third-party tool means another supplier and another admin approval. Because the files leave SharePoint, they also leave Microsoft’s compliance tools. While a file is archived with ArchiveBridge, SharePoint search finds only its link file, by name, not the words inside it, and old links to it won’t open it. After a restore it’s back at the same path, but old sharing links don’t return. Microsoft 365 Archive keeps archived content searchable, so Microsoft wins here.
Microsoft’s own documentation notes that keeping data in place lets eDiscovery and retention tools work on it directly, with no separate connector. That’s a real advantage of the built-in tier. ArchiveBridge narrows the gap without closing it. It skips files whose retention label locks them as a record, but it doesn’t read legal holds or retention policies, so keep sites under a hold out of scope. Its backups still copy held, labelled and record-locked files, because a backup never changes or removes anything. If your compliance policy requires everything to stay inside Microsoft, Microsoft 365 Archive is the better fit.
Microsoft 365 Archive vs third-party archiving: the decision framework
Strip it down to a few questions:
- How far over are you? A little, and shrinking? Microsoft 365 Archive is the low-effort fix. A lot, and growing? Archiving to cheaper cloud storage pays for itself faster every month.
- How often do old files come back? Files that stay untouched suit Microsoft’s tier. Files reopened at unpredictable times can hit the four-month lockout, which favours a third-party tool.
- Do you care where the files live? If portability and per-GB cost matter, archiving to your own storage wins. If staying 100% inside Microsoft is a hard requirement, or people need to search inside archived files, it doesn’t.
- What’s the three-year picture? Data rarely shrinks. Model the compounding cost before you commit. Our published per-terabyte pricing is built for that comparison.
These two aren’t the only options. For the wider field, including Archive360, Preservica, ShareArchiver, Squirrel and ShArc, see our comparison of SharePoint archiving software. If the shortlist includes a governance platform, the AvePoint Opus comparison explains when that broader product is justified and when it’s too much for a storage bill.
Take your own numbers to Microsoft’s pricing and to ours. The free scan works them out before anything moves.