Microsoft 365 cost optimisation across licences, Azure, and Cloud PCs.

It depends on how many seats sit idle and which plans they are on: an unused premium seat wastes far more than a basic one. Rather than rely on a headline figure, measure your own tenant. A first scan of most estates finds a meaningful share of licences inactive or downgradeable, and each one maps to a monthly amount you can reclaim.

Unassigned licences are seats you pay for that are not allocated to any user. The Microsoft 365 admin centre billing view shows purchased versus assigned counts. EtherInsights goes further: it tracks unassigned and inactive licences together across the tenant, names an owner, and turns the gap into a reclaim action you can act on.

Microsoft 365 licence optimisation is the ongoing work of matching paid seats to real usage: reclaiming unassigned and inactive licences, downgrading over-specified plans, removing duplicates, and cleaning up leavers. Run as a regular rhythm rather than a one-off audit, it keeps spend aligned to the people and workloads that actually need each plan.

Yes, for a point-in-time answer. The admin centre shows purchased against assigned seats, and Microsoft Graph or PowerShell can pull sign-in and per-service activity. What does not scale is joining those exports every month, repeating it across more than one tenant, keeping enough history to see drift, and making sure each finding ends up with someone accountable. That maintenance cost is usually what decides whether tooling is worth it, not the reporting itself.

A shared mailbox does not need a licence while it stays within its free storage quota and nobody signs into it directly. It does need one if it grows beyond that quota, or if you apply features such as In-Place Archive or litigation hold. Licensed shared mailboxes that no longer need to be licensed are easy to miss, because in the billing view they look exactly like ordinary assigned seats.

Start by separating consumption from entitlement. Every tenant includes a base quota plus an allowance per licensed user, and you only pay for what sits above it. The recoverable waste is usually orphaned OneDrive accounts left by leavers, old file versions and recycle bin contents that retention has not cleared, and duplicated project sites. Measure consumption growth against the included quota before adding storage, because the cheapest additional gigabyte is the one you release.

Only where the E5 capabilities are genuinely unused, and check what each user depends on before moving them. E5 carries security, compliance, analytics, and voice capabilities that are easy to overlook in a usage report because they run in the background rather than as an app someone opens. The safe method is to identify the specific E5 features in use per user, confirm with the service owner, and downgrade in cohorts rather than in one sweep.

The entitlement split moved as well as the price. Capabilities including Microsoft Defender for Office Plan 1, Remote Help, and Intune Plan 2 moved down into Microsoft 365 E3, while Endpoint Privilege Management, Cloud PKI, and Enterprise App Management remain E5. The practical consequence is that some organisations now pay separately for an add-on their base plan already covers. Check any add-on against your current entitlement before renewing it rather than against last year.

Treat them like any other premium licence: assign in cohorts, set a review date at the point of assignment, and check real usage before the renewal rather than after it. The pattern we see most often is a pilot group that was sized generously, never trimmed, and quietly renewed. Reviewing assignment against usage on a fixed cycle costs nothing and catches it before the commitment rolls over.

Scope and depth. Broad SAM and FinOps platforms cover many vendors at a shallower level for each one, which suits a large procurement function. EtherInsights goes deep on a single estate, Microsoft, so licence, Azure, storage, and Cloud PC waste are assessed together with the operational context you need in order to act. If you already run a broad SAM platform, this complements it on the Microsoft detail rather than replacing it.

Build the reclaim into the offboarding step rather than a periodic audit, because the gap between the leaving date and the reclaim date is pure waste and it compounds. In practice that means converting the mailbox where it has to be retained, removing the licence, and recording the date it happened. Estates that only reclaim at the annual true-up typically carry several months of leaver licences at any point in the year.

Monthly for licences and Azure resources, quarterly for the structural questions such as plan mix and storage growth. Monthly is frequent enough to catch leaver and project waste before it compounds, and light enough to survive a busy quarter. Anything less frequent tends to drift into an annual audit, which finds the same problems every year.