• Microsoft has admitted cloud-based M365 data owned by licensed nonprofits has been deleted in a license-switching cock-up
• Microsoft retired its 365 Business Premium Grant license, advising nonprofits to move to the Microsoft 365 Business Basic for free
• The deleted data cannot be retrieved

Microsoft has admitted it accidentally deleted the data from an undisclosed number of nonprofits with retiring Microsoft 365 Business Premium Grant licenses. While advising the customers to switch to a different license for free and offering a retention and export window, the software behemoth somehow managed to lose their data, rather than retain it.

Worse, Microsoft has also admitted the lost data is irretrievable. So unless the organizations concerned had their own backups of the cloud-based data, the situation is irreversible.

All organizations with an expired Business Premium subscription are affected, but Microsoft has offered them a complementary “concierge service” to help get set up on their new Microsoft 365 Business Basic license – assuming they haven’t switched to Google Workspace.

How has this happened?

Microsoft 365 Business Premium Grant licenses were specifically for nonprofit organizations. It provided 10 free licenses for eligible organizations.

The announcement of their impending closure was made in early 2025. Any renewal on or after July 1 2025, would have been the last one. At the time, Microsoft issued an email to licensees:

“The Microsoft 365 Business Premium grant will be discontinued on your next renewal on or after July 1, 2025. Your licenses will expire on April 1, 2026. We will continue to provide up to 300 granted licenses of Microsoft 365 Business Basic and discounts of up to 75 percent on many Microsoft 365 offers to nonprofits, including Microsoft 365 Business Premium.”

Once a decision was made, the license should have been migrated to a Microsoft 365 Business Basic or Microsoft 365 Business Premium license, based on the demands of the organization concerned. Emails and documents should not have been affected.

Instead, data has been lost.

Microsoft’s vague mea culpa

According to reports, Microsoft has admitted that “data cannot be recovered” and is similarly unable to provide any list or spreadsheet or log of what was lost. This leaves nonprofit organizations – notably, those with low license requirements, so presumably operating on minimal funding – without access to the data they had stored within the Microsoft 365 OneDrive cloud.

They will also be without emails, potentially including details concerning contracts, fundraising, and other critical information.

Microsoft has expressed regret and attempted to manage the situation by offering the affected organizations a specialist to assist in setting up a new Microsoft 365 account. However, given the fact that the data has been lost, and there is no migration headache to endure, it's a good bet Google Workspace or even Zoho Workplace are stronger options.