Most Microsoft 365 administrators know their SharePoint storage bill is high. What most of them don’t realize is why.
It’s not that SharePoint is overpriced for active, in-use data. The problem is that 70 to 80 percent of everything stored in SharePoint hasn’t been opened in over a year. Old project folders. Archived contracts. Reports from three years ago. Files that will never be touched again but still sit in SharePoint, billed at full Microsoft storage rates every single month.
That’s the SharePoint Tax. You’re paying for data that isn’t working for your business, and you’ve probably been paying it for years without realizing it.
What SharePoint Storage Actually Costs
Microsoft 365 plans come with storage allocations, but once you exceed them, the costs climb fast. Additional SharePoint storage is billed per gigabyte per month. For organizations with years of accumulated files, that adds up to a significant recurring cost that has nothing to do with how productive your team actually is.
Here’s where it gets frustrating. Your finance team is paying for storage. Your IT team is managing storage. And the data driving most of that cost is documents nobody has looked at since before your last office renovation.
The 80/20 Rule of Data Access
Research consistently shows that around 80 percent of organizational data is cold – meaning it’s rarely or never accessed after the first few months of creation. The other 20 percent is the active, frequently accessed data your teams actually depend on daily.
In a healthy storage setup, those two categories should not cost the same per gigabyte. Hot data, accessed frequently, belongs in fast, premium storage. Cold data belongs somewhere cheaper, with a way to get it back quickly if it’s ever needed.
Most Microsoft 365 backup organizations don’t have this separation. Everything goes into SharePoint. Hot and cold, side by side, billed at the same rate.
What Stubbing Actually Does
Stubbing is the mechanism that fixes this. It’s not a new concept – it’s been used in enterprise storage management for decades — but it’s only recently become available for cloud platforms like SharePoint Online.
Here’s how it works in plain terms. When a stubbing policy runs on your SharePoint environment, it identifies files that haven’t been accessed past a threshold you define, maybe 90 days, maybe a year. The actual content of those files is then moved to a lower-cost storage tier, such as your backup infrastructure. What stays behind in SharePoint is a stub: a lightweight pointer that looks and behaves exactly like the original file.
Your users see the same file in the same folder. They can click it, open it, work with it. They have no idea it was moved. But SharePoint is no longer storing the full file. The data lives somewhere cheaper, and your Microsoft storage bill reflects that.
How Much You Can Actually Save
The math depends on how much cold data you’ve accumulated, but the numbers are often significant. Organizations that have been running Microsoft 365 for three or more years typically find that stubbing can reduce their active SharePoint storage footprint by 50 to 70 percent.
If you’re currently paying for 10TB of SharePoint storage and 7TB of it is cold data that gets stubbed out, you’re now paying for 3TB of premium SharePoint storage instead of 10TB. The rest lives in your backup environment at a fraction of the cost.
Over a year, for a mid-sized organization, that can translate to tens of thousands of dollars in avoided Microsoft storage costs. Not because you deleted anything. Not because you reorganized anything. Just because the cold data moved to where it belongs.
Why Most Backup Tools Don’t Offer This
This is the part most vendors won’t bring up in a sales conversation. The majority of backup platforms — including several of the most widely recognized names in the market – are built to create copies of data. Copy it, protect it, and restore it if something goes wrong. That’s what they do well.
But managing the source is a different capability. Moving live data out of SharePoint while keeping it seamlessly accessible to users requires deep integration with the SharePoint Online storage architecture. Most platforms simply don’t have it.
ExchangeSavvy, powered by Cohesity Alta SaaS Protection, is built to do exactly this. The stubbing policy applies directly to SharePoint Online, moves inactive data to the backup tier, and maintains full user-facing access through the stub. You get the cost reduction without the operational disruption.
What to Do Next
If you’re not sure how much cold data you’re currently storing in SharePoint, an analysis of your environment will give you a clear picture. The ExchangeSavvy team can run this assessment and show you exactly how much storage reduction is realistically achievable before you commit to anything.
There’s no reason to keep paying the SharePoint Tax when the technology to stop it already exists.
Frequently Asked Questions
Q1: What is the SharePoint Tax?
The SharePoint Tax is an informal term for the unnecessary cost organizations pay when storing large volumes of inactive data in SharePoint Online at premium Microsoft storage rates. Most of this data hasn’t been accessed in over a year but continues to occupy expensive primary storage.
Q2: What is SharePoint stubbing?
SharePoint stubbing is a data management technique where inactive files in SharePoint Online are moved to a lower-cost storage tier. A lightweight placeholder — called a stub — remains in SharePoint so users can still access the file as normal, without knowing it was moved.
Q3: Does SharePoint stubbing affect the user experience?
No. Users see the same files in the same locations. They can open, edit, and share them as usual. The stub handles retrieval transparently. Most end users will never know a stubbing policy is in place.
Q4: How much can stubbing reduce SharePoint storage costs?
Organizations with 3 or more years of accumulated data typically see a 50 to 70 percent reduction in active SharePoint storage after a stubbing policy is applied. The exact savings depend on how much cold data is present in the environment.
Q5: Which backup platforms support SharePoint Online stubbing?
Very few. Most enterprise backup platforms focus on creating copies of data, not managing the source environment. ExchangeSavvy, powered by Cohesity Alta SaaS Protection, supports direct stubbing policy application to SharePoint Online.
