M365 Archive: Cut Storage, Clean Data

Key insights

• File-level archiving in Microsoft 365 Archive lets you archive individual files in SharePoint and OneDrive while keeping them visible in their libraries.
  Archived files keep metadata, permissions, retention settings and version history so governance stays intact.
• Reduce storage costs by moving inactive content to a lower-cost cold tier.
  Microsoft cites archive pricing around $0.05/GB/month versus standard additional storage examples near $0.20/GB/month, meaning significant per‑GB savings for cold data.
• Improve Copilot signal quality and search relevance by removing stale or low-value files from the active index.
  This reduces noise and helps Copilot and search show fresher, more useful results.
• Cold data storage tier reclassifies files rather than deleting them: active storage decreases while archived storage increases, so total tenant storage stays the same.
  That lets organizations lower active storage costs without losing governance or access.
• Prerequisites and setup: you need an Azure subscription (pay-as-you-go), Microsoft 365 Archive enabled, an updated SharePoint Online Management Shell, and a role such as SharePoint Administrator or Global Administrator.
  During preview, enable the feature with PowerShell: Set-SPOTenant -AllowFileArchive $true, Set-SPOSite -Identity [site_url] -AllowFileArchive $true, Set-SPOTenant -AllowFileArchiveOnNewSitesByDefault $true.
• Operational benefits: archive only the files you choose instead of whole sites, keep content inside SharePoint (no separate repository), and improve overall data quality for compliance and search.
  The feature entered public preview in 2026 with general availability expected in July 2026.

Keywords

M365 file-level archive, Microsoft 365 archive solution, reduce storage costs Microsoft 365, file-level retention M365, optimize M365 storage, improve data quality Microsoft 365, M365 compliance archiving, SharePoint OneDrive file archiving