Exchange licensing FAQs

Exchange Online is licensed via a subscription model in which each user needs a User Subscription License (USL). Three types of subscriptions are available: Exchange Online Kiosk, Exchange Online Plan 1, and Exchange Online Plan 2. These subscriptions can be purchased on their own or as part of a Microsoft 365 plan that includes SharePoint Online, OneDrive, and Microsoft 365 Apps for enterprise.

To compare the different plans, see comparing Exchange Online plans. Or, for more detail, see the Exchange Online service description.

No. Resource mailboxes, including Room Mailboxes and Equipment Mailboxes, are special mailbox types that are provided free of charge as part of Exchange Online. There is no limit to the number of conference room subscriptions.

No. Shared mailboxes don’t have login credentials, so they are only accessible by licensed users who have been granted delegate access (full mailbox permission, send as, or send on behalf of).

Shared mailboxes do not include a personal archive or legal hold capabilities. If you need these features, then you can purchase either Exchange Online Plan 1 or Plan 2 and assign it to the shared mailbox.

There is no limit to the number of shared mailboxes though the size is limited to 50GB. If you require a shared mailbox that is larger than 50GB, an Exchange Online Plan 2 license will need to be assigned to it.

You must assign the shared mailbox to either an Exchange Online Plan 1 plus Exchange Online Archiving subscription, or to an Exchange Online Plan 2 subscription in order to enable In-Place Archive. A shared mailbox can’t be used to archive email for an organization, except for those messages that are sent from the shared mailbox or received by the shared mailbox.

An In-Place Archive can only be used to archive mail for a single user or entity for which a license has been applied. Using an In-Place Archive as a means to store mail from multiple users or entities is prohibited. For example, IT administrators cannot create shared mailboxes and have users copy (via CC or Transport rule) a shared mailbox for the explicit purpose of archiving.

You must assign the shared mailbox an Exchange Online Plan 2 subscription in order to put it on In-Place Hold.

Yes, these mailboxes require a subscription. The subscription type can be Exchange Online Kiosk or Exchange Online Plan 1 or Plan 2.

No. For more information about Discovery Search Mailboxes, see create a Discovery Mailbox to store search results.

Public folder mailboxes are available to users with Exchange Online Plan 1 and Plan 2 subscriptions. They are not available for Exchange Online Kiosk users.

No. Using journaling, transport rules, or auto-forwarding rules to copy messages to an Exchange Online mailbox for dual-delivery purposes is not permitted. To preserve messages, you must put user content on In-Place Hold, or journal the messages to an external journal target.

There are no limits on the duration of retention policy. You can set the retention duration based on your business needs.

The In-Place Archive feature in Exchange Online Plan 2 provides unlimited storage of email data for one user. The In-Place Archive has a default quota that is large enough to accommodate reasonable use, including the import of one user’s historical email. In the unlikely event that a user reaches this quota, Microsoft 365 automatically increases the size of the archive, which means that users won't run out of mailbox storage space and administrators won't have to request additional storage for archive mailboxes.

Exchange Online Kiosk is designed for users who require fewer messaging features because they do not have dedicated computers. The subscription provides 2 GB of mailbox space per user and web-based access through Outlook on the web. Certain features are disabled for Kiosk users, including inbox rules, public folder mailboxes, site mailboxes, and delegate access to other mailboxes. For more information, see the Exchange Online service description.

Yes, all Exchange Online subscriptions, including Exchange Online Kiosk, allow organization-wide capabilities such as In-Place eDiscovery, journaling, custom retention policies, and premier anti-spam and anti-malware filtering via Exchange Online Protection.

Users with Kiosk mailboxes are protected by the same uptime SLA and geo-redundancy protection as other Exchange Online mailboxes.

In order to place a Kiosk mailbox on In-Place Hold, you must upgrade it to Exchange Online Plan 2 or purchase the Exchange Online Archiving for Exchange Online add-on.

Yes. In the Microsoft Online Services Portal, you can assign the user a new subscription and remove the old one. This will automatically update the user’s capabilities in Exchange Online. The procedure for purchasing new subscriptions and cancelling old ones varies; check your specific license agreement for details.

Yes. In the Microsoft Online Services Portal, you can assign the user a new subscription and remove the old one. This will automatically update the user’s capabilities in Exchange Online. For the smoothest transition, you should remove any In-Place Holds from the user’s mailbox prior to assigning them the new subscription. The downgrade behavior is as follows:

• Mailbox data: All data in the user’s mailbox and archive is preserved. If the user has a total of more than 50 GB of data in the primary mailbox plus the archive, the conversion will succeed, but the mailbox will be out of compliance from a licensing perspective until the excess data is deleted by the user.
• In-Place Hold: If the mailbox is on In-Place Hold, the hold remains in place. The mailbox will be out of compliance from a licensing perspective until the In-Place Hold is cleared. If you are using Directory Sync, you can clear the In-Place Hold by updating the user's Active Directory object, otherwise you must call support to have it cleared.
• Hosted voice mail: This feature is automatically disabled for the user as part of the transition.

The procedure for purchasing new subscriptions and cancelling old ones varies; check your specific license agreement for details.

Yes. In the Microsoft Online Services Portal, you can assign the user a new subscription and remove the old one. This will automatically update the user’s capabilities in Exchange Online. For the smoothest transition, you should delete the user’s inbox rules and SMS notifications prior to assigning them the new subscription. The downgrade behavior is as follows:

•Mailbox size: If the size exceeds 2 GB, the action will fail.
• Inbox rules: Existing inbox rules are left in place but they are not editable. You can call Microsoft 365 support and have them delete the user's rules on your behalf in order to bring the mailbox into compliance with licensing terms.
• SMS notifications: Existing SMS notifications are left in place, but new ones can’t be created. You can call Microsoft 365 support and have them delete the user’s existing SMS notifications in order to bring the mailbox into compliance with licensing terms.

The procedure for purchasing new subscriptions and cancelling old ones varies; check your specific license agreement for details.

If you do not host any mailboxes on the servers used to connect to Microsoft 365 you can license them using the Microsoft 365 Hybrid Configuration Wizard (HCW) which you can find here .The HCW validates your Microsoft 365 subscription and installs the appropriate licenses on your servers.    

You can use PowerShell to enter the new product key.

You can point your MX record to Exchange Online in a hybrid deployment. In this scenario, Exchange Online Protection (EOP) provides anti-spam and anti-malware filtering on inbound mail for the on-premises users, so these on-premises users require EOP subscriptions.

A user with an F1 license cannot configure delegates to their own mailbox, but they can access another mailbox (including shared mailboxes) and perform any actions which have been delegated to them.