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5 Ways You Are Over-Spending on Microsoft 365 Licensing

Do you feel like you are likely giving Microsoft more money than you need to for your Office 365 or Microsoft 365 licenses? Feeling confused about how they bundle products and what features and functions that your users are actually using? Imagine if you had the data to find a way to reduce your Office 365 and Microsoft 365 subscriptions by 12% and 35%. How impactful would that be on your IT Budget?

If you have Office 365 or Microsoft 365 subscriptions, you are likely spending more than you need to be. Utilizing our proprietary SLIM 360 tool, we have analyzed over 2 million users of Office 365 and the results are that the average company is spending anywhere between 12% and 35% more than they need to.

Here are the top areas that we find companies are paying for subscriptions that they should not be:

Paying for Blocked Users in Office 365

When someone leaves your company, you need to stop them from accessing your Office 365 data. The process for this is to put them into blocked user status. This means their data (Exchange mailbox, SharePoint, OneDrive, etc.) is still there but that they can no longer get access to it. Users in blocked status still consume their Office 365 subscriptions, so when their replacement is hired you end up purchasing another license (unnecessarily). Most organizations believe they have a process to identify these blocked users, but we see anywhere between 3-6% of subscriptions that can be reclaimed when the right analysis is done.

Office 365 Service Accounts

There are a few technical reasons why Service Accounts (non-humans) require an Office 365 subscription to be assigned to them (e.g., you need Office Pro to be signed in at all times in order for an application to work on a server). However, the PowerShell scripts or on-boarding of Office 365 subscriptions is an imperfect process, and when an analysis is done of Service Accounts that have been assigned subscriptions, we are finding between 2-5% over-subscribed licenses.

Users with Multiple Subscriptions

As mentioned above the on-boarding process of Office 365 is far from perfect. Just think, this process often relies on Active Directory and most organizations know that this is not ideal. This means that employees often end up being tied to multiple subscriptions. The impact is between 1-2% of your subscriptions can be reclaimed when this is analyzed.

Group Mailboxes with Subscriptions

Group mailboxes should be free unless they are bigger than 50GB. It is very common for us to see E1 or E3 licenses assigned to them. These unnecessary licenses cost anywhere between 1% and 4% of your overall Office 365 costs.

Users with the Wrong Subscription Types

This category may be the hardest to identify. Each of the ones above if you like data you can find them by looking through and downloading several reports out of the Office 365 Tenant – though it isn’t very easy. Users with the wrong subscription type not so easy, however.

Most organizations believe all their users need E1s, E3s, or E5s. Some have optimized their task-based workers (those that do not have their own computer and instead used shared devices or kiosks). Our data suggests that the average organization is actually using less than 40% of the functionality they pay for. Think about it: an E5 has over 50 products included in it and the average organization is only using 20 of those. We know this is caused by how Microsoft bundles and prices their subscriptions. There are things that can be done to reduce your subscription costs through right-sizing that can save you between 5-20% of your Office 365 or Microsoft 365 subscription costs.

Bonus: Unused Visio and Project Subscriptions

If you wanted to look to see if users that were assigned a Project or Visio Online were using them, you would not find this data anywhere in your Office 365 Tenant. It’s no surprise to us. When we analyze this data, we find that anywhere between 30-50% of these subscriptions are not activated or have not been used in the last 90 days.

Adding Up the Savings in Your Office 365

Just think about how much all this waste could mean to your IT Budget if you had the ability to identify it and reclaim those licenses. If your Office 365 costs just $500,000 a year that is anywhere between $60,000 and $175,000 that you could get back. If you want to have a discussion about how you can take back control of your Microsoft spend, please click the link below and book a 30-minute call with one of our specialists.

Give Your Microsoft 365 Licensing a Health Check

Book a meeting with MetrixData 360 today and see how much you could be saving on your Microsoft 365.


Give Your Microsoft 365 Licensing a Health Check

Book a meeting with MetrixData 360 today and see how much you could be saving on your Microsoft 365.