3729106 - Outbound Email Integration Considerations for Microsoft 365 and Service Cloud V2

• Customer is evaluating whether Microsoft 365 (M365) SMTP servers can be used for inbound and outbound email communication in SAP Service Cloud Version 2.
• Clarification requested regarding compatibility
• No explicit confirmation found in public documentation

• SAP Service Cloud Version 2 1.0
• SAP Sales Cloud Version 2 1.0

• SMTP integration depends on alignment between authentication methods supported by both systems
• Microsoft has introduced changes in Exchange Online security policies, moving toward modern authentication (OAuth 2.0) and reducing support for Basic Authentication

Current Behavior

• SAP Service Cloud Version 2 supports SMTP connectivity using Basic Authentication
• M365 environments may allow SMTP usage if Basic Authentication is enabled at tenant level

Important Consideration

• Microsoft’s direction toward modern authentication standards may impact SMTP configurations that rely on Basic Authentication
• This is part of a broader industry-wide security evolution, not specific to a single platform

Recommended Approach

• Customers are advised to:
  • Verify authentication capabilities within their M365 tenant
    • For M365, please check the "Updated Exchange Online SMTP AUTH Basic Authentication Deprecation Timeline"
  • Consider other SMTP services compatible with their organization’s security policies
  • Align email infrastructure with supported authentication mechanisms across systems

Product Direction

• SAP continuously evaluates enhancements to support modern authentication methods, including OAuth 2.0, to ensure alignment with evolving industry standards
• Customers can share feedback or track related enhancements via the Customer Influence Portal: Emails: SMTPAUTH over TLS as Authentication Method 

• Refer to: Configure Mail Transfer Agent (MTA) 
• Refer to: updated exchange online smtp auth basic authentication deprecation timeline.
• Refer to: oauth2.0 support for smtp connection.

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