SharePoint vs OneDrive vs Teams: Where Company Files Should Live

SharePoint vs OneDrive vs Teams: the short version

All three use the same storage engine, which is why they look alike. The difference is who owns the files and who can see them by default.

Microsoft's article on how SharePoint and OneDrive interact with Teams confirms that creating a team creates a parent SharePoint site used for all standard channels, and that each private channel has its own SharePoint site.

Storage and sync limits that matter for an SME

You rarely run out of OneDrive space, but SharePoint storage is shared across the company and can fill up after a file server migration.

Microsoft's SharePoint limits page gives the 1 TB plus 10 GB per licence pool, and its restrictions and limitations article gives the 250 GB file limit and the 300,000-item sync recommendation. Microsoft says it is starting to support up to 1,000,000 items on newer, well-specified PCs, but older laptops stay at the 300,000 figure.

Why company files should not live in OneDrive

OneDrive feels convenient because it is the default save location in Office. The risks show up later:

• Leavers: when a user is deleted, another person gets access to their OneDrive for 30 days by default, according to Microsoft's OneDrive retention and deletion article. After that the files are deleted unless retention settings keep them.
• Unlicensed accounts: Microsoft archives OneDrive accounts without a valid licence on their 93rd unlicensed day, and archived storage carries a charge.
• Hidden sharing: files shared from OneDrive with 'anyone' links are hard to track across the company.
• No structure: each person invents their own folders, so nobody else can find anything.

Our employee offboarding IT checklist covers moving a leaver's files before the account is deleted.

A simple SharePoint structure for a small business

For a company of 5 to 50 people, a handful of sites is enough. More sites mean more permissions to manage.

Give access to a site through its Microsoft 365 group or team membership, not to individual folders. When you need a different audience, create a new library or site rather than breaking permissions deep in a folder tree, which becomes impossible to audit. Clean up old sharing links regularly; our guide to cleaning up SharePoint and OneDrive sharing links shows how.

Moving from a file server or shared drive to SharePoint

Microsoft's free Migration Manager in the SharePoint admin centre moves file share content into SharePoint, Teams and OneDrive. The tool is the easy part; the plan is what matters.

1. 1

   Map old folders to new sites

   List the top-level folders on the server and decide which SharePoint site and library each one goes to. Archive what nobody has opened in years.

2. 2

   Fix names and paths

   Rename files and folders with characters OneDrive does not allow and shorten very deep paths before moving them.

3. 3

   Set permissions on the new sites first

   Create the sites, add the right groups, and test with one user from each department before any data moves.

4. 4

   Run a pilot with one department

   Move one department, let them work for a week, and fix what they report before moving the rest.

5. 5

   Cut over and make the old share read-only

   Run a final sync, set the old server or drive to read-only, and tell staff where things now live. Keep it read-only for a few weeks, then retire it.

If you are deciding between Microsoft and Google storage first, our comparison of Google Drive vs OneDrive vs Dropbox covers prices and version history, and our guide to Google shared drives vs My Drive explains the same personal-versus-team rule on Google Workspace.

Security settings to check while you are there

These settings live in the SharePoint admin centre and the Microsoft 365 admin centre. Changing the default link type and external sharing level takes a few minutes and closes the most common leak.

Do it yourself or get help?

A small team can set up three or four SharePoint sites and move files in a weekend, as long as someone owns the folder plan and permissions. Get help when you have a large file server, years of mixed permissions, or staff on personal devices.

Our Microsoft 365 / Google Security Lockdown (S$590) sets sharing defaults, MFA, admin roles and device rules across Microsoft 365, so the new file structure starts secure.