This method of relaying messages allows Office 365 to handle email delivery on your behalf by authenticating using your public IP address or a certificate. Your device or LOB application can send email as any email address within your owned and verified domains. The address does not have to resolve to an Office 365 mailbox. However, if the email address doesn’t exist, then recipients that reply to the emails will receive a Non-Delivery Report (NDR). If the device or application is used to send spam or bulk email against the Office 365 Terms of Service, the email address and/or IP may be blocked by Office 365. If your device or LOB application supports or requires authentication (for example, if your users need to send emails only as their own accounts), you may want to consider the Client SMTP Submission method instead.
If all of your users have Office 365 mailboxes, you don’t need any additional licensing to use this option.If you have senders using the device or LOB application who don’t have an Office 365 mailbox, then you should make sure that each non-Office 365 user has an Exchange Online Protection license to cover outbound and/or inbound relay.
If you have already setup Exchange Hybrid or have an Exchange Online Protection Inbound On-premises Connector configured, then it is likely that no additional setup will be required for Office 365.
1. Obtain the public IP address you’re using. A dynamic IP address isn’t supported or allowed. You can share the IP with other devices and users, but you shouldn’t be sharing the IP with anyone outside of your company. Make note of this IP address for later.
2. Log on to the Office 365 Portal.
3. Select Domains.Highlight one of your domains and use the wizard to obtain your MX record. The MX record will look similar to contoso.com.mail.protection.outlook.com. Make a note of the MX record for later.
4. In the upper right, select Admin and then select Exchange from the drop down. If you have Small Business, then see the http://outlook.office365.com/ecp/ site to complete the following steps.
5. In the Exchange Admin Center, select Mail Flow > Connectors.
6. If no inbound connector exists, create one.
1. Give the connector a name.
2. Select On-Premises for the Connector Type.
3. Under Domains,add a single asterisk (*). This will allow sending to any domain. Other values in this field will limit the domains that you can send mail to.
4. In the IP Addresses section, add the IP address from Step 1.
5. Leave all the other fields with their default values and select Save.
7. OPTIONAL: In the DNS for your domain, we suggest that you modify your SPF record to include the IP address from Step 1. The finished string should look similar to this: v=spf1 ip4:10.1.2.3include:spf.protection.outlook.com ~all where 10.1.2.3 is your public IP address. Skipping this step could cause email to be sent to recipients’ junk mail folders.
8. In the device’s settings, specify a Smart Host value equal to the MX record value you recorded in Step 3.