Licensing , User Mailboxes and Reconcillation

Brass Contributor

Hey team, 


I am trying to figure out an issue where we seem to be 860 licenses shy of having the correct number of licenses based on our user base. 


In the portal under (Billing >> Licenses >> E3). I show the following:


  • 20795‎ assigned of ‎20795‎ total
  • ‎870‎ users need valid licenses

Now my question is as follows, are the 870 users already licensed ? and we've just oversubscribed? or does that mean that we need to add (and license) 870 more user accounts? 


Also, how can i tell which mailboxes/user accounts above need to actually have a license applied to them? is there any easy way. 


Also, one more note, if i run this command here: 


Get-MsolUser -LicenseReconciliationNeededOnly -All - The output contains Shared Mailboxes, Room Mailboxes as well as user mailboxes, why would "LicenseReconciliationNeededOnly" report room/shared mailboxes as needing a license?







6 Replies

You probably have some expired licenses, you can get a breakdown on the Products page. As for the cmdlet output, you might be using features such as holds or Archiving which DO require a license for shared/room mailboxes too.

@Vasil Michev 


Hey Vasil, 


I was under the impression that if you did the following:


1) User has E3 license

2) You place user on Either Litigation Hold or In-Place hold

3) You remove users license

4) You remove users account from AD Connect

5) User mailbox then shows as inactive in PowerShell


The users mailbox is on litigation hold without needing a license and all data will be available per the terms of the hold. Do i have that wrong? 




That's not the correct process, removing the license puts the mailbox in "erroneous" state. If you want to make the mailbox "inactive", you need to remove the user object without removing the license first (it will still be freed).

@Vasil Michev 


Thanks Vasil. It was my understanding that when you place a mailbox on hold, that you are correct, if you remove the license it will show an error in the admin center, portal, users. however once the account is removed from AD Connect the error seems to go away. 


In either case based on my testing errored out or not, the mailbox still retains the data. in fact i just checked on mailboxes that were placed on hold (some show an error in the portal, others do not), and they all retained their data. These mailboxes were placed on hold on 6/5/2020. 





The fact that it retains the data (the hold is still active) doesnt mean that the object is in the "correct" state, as it's now technically in violation of the license agreement. Microsoft made a deliberate decision not to remove any mailboxes put on hold even when no matching license is assigned in order to avoid data loss. This does not mean that you are free to use this functionality without effectively "paying" for it. Moreover, since this is not a *supported* scenario, they can change the behavior at any time. Stick to what the recommend/support.

@Vasil Michev 


Thanks Vasil. And Agreed. I think we have the right idea just the wrong order. In our process every account which is placed on hold and then has the license removed, is eventually removed via adconnect.