Splitting a Domain Between SmarterMail & Office 365
Idea shared by Paul Blank - 9/17/2018 at 6:49 AM
Email is super-important these days to just about every business, so it's a good idea to remain as flexible as possible in this regard.

One solution is splitting your email domain users between SmarterMail and Office 365.

You can complain about the expense of O365, but you do get the entire Office suite including desktop and cloud apps for $12.50/month (retail), with 50GB of email storage and 1TB of cloud storage, and all updates are included. The Office suite is Microsoft's not-so-secret weapon; Microsoft lets you install it on up to 5 devices per user. And there's a range of options starting at $5/mo. that can be applied per user, including email-only, apps-only, cloud-only etc. BTW there's a 300-user limit for some of these plans, and then you're going to the Enterprise plans. But I deal with smaller companies; that's not an issue for me.

And if you have just ONE user on O365 email (at around $5/month) (!), you can use EOP (Exchange Online Protection) with spam & anti-virus (etc.) filtering for your entire domain, for all email incoming and outgoing. And this is all fully legal within the terms of your O365 license, as of this writing. I double-checked it twice with Microsoft before I went ahead with this; it's now implemented for one of my clients, and is working fine. Email flows between all domain users on SM and O365 without issue. I can now migrate users from SM to O365, and vice-versa, when needed.

Takes quite a bit of grunt-work to set up, but that was expected going in.

Calendars are another story. Still working on this but in this case it's not a deal-breaker.

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Paul, good points and nice find regarding the EOP!  Surprised Microsoft allows this.

Small businesses who already purchased Outlook will choose SM for the lower cost. But any business who needs to upgrade Outlook will be pressured to go with the Microsoft's Office/O365 bundle simply because the price is so good.
The split-domain is a good hybrid solution, but long-term, the way to compete IMO is with a 1) more powerful webmail client that has the look and feel of Outlook and 2) great integration with mobile devices.

If you are willing to do the heavy lifting to set this up (and it is substantial!), the EOP thing might be worth it, but I really did it for the client's Office suite, which was badly in need of updating, and for a few issues with SM; the EOP is quite a plus, however. SM doesn't go away, but we are migrating some users to O365.

We were able to quit Symantec email security.cloud; that alone pays for 2 month's of Office 365 for the entire organization, after all desired users are added.

Note that if you're using a SM v15 server, the split-domain setup will only work properly with one domain, as this version of SM can't be set to send through more than one outbound gateway (AFAIK) unless you try using additional SM gateways for additional domains. I have not tried this, however.
We have this office 365 / smarter mail 'hybrid' setup for a number of different customer domains on the same smartermail instance without any issues. Inbound comes in through EOP, outbound to other domains is delivered direct from smartermail.

Unless I am missing something it is a 5 minute job, okay perhaps 10 but not a big issue:

  1. (365) Add the domain in O365
  2. (DNS) Configure the required O365 DNS records including pointing MX records to 365
  3. (DNS) Tweak the SPF record to accommodate the smartermail server usage
  4. (365) Change the domain to internal relay
  5. (365) Create a connector to point back to smartermail (i.e. 365 to my mail server)
  6. (SM) Configure the domain  in smartermail: Domain Location=External (Use MX record), Tick 'delivery locally if user exists'

It was a bigger issue for a couple of reasons. 

The original version of SM was older and needed to be upgraded. 

This client wanted (and still wants) a catch-all email address for mis-addressed incoming email; in order to create the catch-all rule, all SM usernames and aliases needed to be sucked into O365 as contacts, including usernames for an aliased domain. These included addresses and aliases of those who'd left the company - their email is still forwarded to others; and there were dozens of them. Additionally, some other domains needed to be moved off of SM to another server. 

Because of some bad advice, the contacts distribution list needed to be altered (again for the catchall rule).

And I had no experience with this, so it took awhile to learn some stuff about O365. I did it with an offline domain using my MPN account; it's all now done on the production environment and it's working fine so far.

So yes, it's actually not difficult once you've done it; and now I have. Still lots to learn about O365, of course, and I will be implementing journaling/archiving and such on the O365 side as some users are migrated.

(and although Nathan is correct that it's a hybrid environment, Microsoft, in their infinite wisdom, chooses to reserve that term "internally" for O365 <--> Exchange)

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