Microsoft is retiring several free education offerings: Office 365 A1, the Student Use Benefit and free Exchange Online for Alumni, prompting schools and universities to consider paid replacements or alternative platforms.

Office 365 A1 provides eligible institutions with web-based Office apps, Teams and email at no charge, while its proposed replacement, Microsoft 365 Education A0, excludes Exchange Online, SharePoint Online and Teams and comes with additional eligibility conditions.

The transition is already affecting sales: Office 365 A1 stopped accepting new web-direct orders on November 5, 2026, and partner-channel sales are scheduled to end on May 1, 2027.

Existing agreements remain valid through their current terms, but the changes generally take effect at an institution’s first renewal or contract extension on or after January 1, 2028; affected services are scheduled to end that day.

Schools and universities could face higher bills and complicated migrations of student and alumni accounts, while losing free software for students’ personal devices could complicate remote learning and digital-equity programs.

Education advocates warn that rising licensing costs could deepen the digital divide by making access to essential tools increasingly dependent on local budgets.

Education-sector representatives have raised concerns about affordability and equitable treatment, while the UK Department for Education said it secured concessions and transition time for UK institutions.

Microsoft says the changes reflect institutions’ priorities around AI, security, privacy, governance and teaching, and present a clearer path from basic access to more advanced capabilities.

The company is also changing storage entitlements and introducing Microsoft 365 Education A7, which adds AI, security, governance and device-management features.

Taken together, the changes mark a shift toward paid subscriptions with AI, advanced security and device-management tools, after Microsoft used free education services to build its ecosystem among students.

Governments and education ministries are reviewing contracts and funding needs, while the changes have renewed calls for sovereign cloud services and open standards that reduce reliance on corporate platforms.

The shift is part of a broader retreat from broadly free education services, with Google also tightening its offerings and institutions weighing open-source and specialized alternatives.