Exchange Server SE: Upcoming 2026 updates and why action is needed now
What a year we have had! Who would have thought at the beginning of 2025 that Exchange administrators would be sweating so much? Even though much of it could have been avoided.
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Thomas Stensitzki is a Microsoft MVP, certified Exchange Server Master, and founder of Granikos GmbH & Co. KG, where he helps organizations modernize messaging, collaboration, and cloud security with Microsoft 365 and hybrid solutions. Alongside decades of deep technical expertise, Thomas has recently turned his focus to connecting technology with real-life conversations. He co-hosts the German-language podcast Cloudchroniken (https://cloudchroniken.de/), exploring the stories behind cloud technology, AI, and digital transformation. He also drives Discuss At Ease, an initiative inspired by his 2024 lymphoma diagnosis, creating open dialogue around illness, resilience, and well-being. A prolific speaker and trainer, Thomas shares insights at events like Experts Live and Exchange Summit. He contributes regularly to the Granikos blog, where his “Cumulative Update” series demystifies the latest in Exchange, Microsoft 365, Teams, and Copilot.
What a year we have had! Who would have thought at the beginning of 2025 that Exchange administrators would be sweating so much? Even though much of it could have been avoided.
Centralized Mail Flow (also known as Centralized Mail Transport, CMT) is an option in Exchange hybrid environments whereby all outgoing Internet messages from mailboxes in Exchange Online are first routed through the local Exchange organization before being delivered to the Internet. Similarly, depending on the MX strategy, incoming Internet messages can first pass through the local environment before being delivered to cloud mailboxes. The goal is usually to continue applying central compliance, DLP, encryption, journaling, or gateway functions in the local infrastructure. As a rule, CMT is configured as part of the hybrid configuration using the Hybrid Configuration Wizard (HCW).
Microsoft is changing how hybrid authentication works between on-premises Exchange servers and Exchange Online. The long-standing Shared Service Principal (“Office 365 Exchange Online”, App ID 00000002-0000-0ff1-ce00-000000000000) will no longer be supported. Each tenant must deploy a dedicated Entra enterprise application by October 31, 2025.
Microsoft is ending support for Exchange Server 2016 and 2019 on October 14, 2025, making it essential for IT teams to upgrade to Exchange Server Subscription Edition (SE) to maintain security and compliance.
If you're still evaluating whether maintaining any on-premises Exchange footprint is the right long-term move, revisit the foundation in Do You Still Need an On-Prem Email Solution? It sets the strategic context for whether an upgrade is even the right investment.
Next year, Exchange Server will turn 30, a remarkable milestone for a platform that was often prematurely declared obsolete. The fact is: email remains an indispensable means of communication. According to CloudHQ's Email Statistics report, the number of global email accounts is expected to rise from approximately 4.8 billion today to over 5.6 billion in the next few years. Today, over 392 billion emails are sent daily, and by 2030, this number is expected to grow to over 500 billion. So, the question is not whether email will remain relevant.
Exchange Server has two core components. First, there is the mailbox component, with all the required client access protocols and well-known mailbox functions. The second major component is the message flow, with receiving, processing, and sending email messages.
Before we talk about Exchange Server's Managed Availability features, let's first remember the architecture of Exchange Server.
Since the early days of Exchange Server, the limits of user mailboxes were strictly regulated. In many Exchange organizations, these quota limits were configured on a mailbox database level and were therefore consistent for all mailboxes stored in the same database. This approach was selected because the existing hard disk space was scarce and expensive in the past.
The virtualized operation of Exchange Server has been a hot topic for discussion ever since the introduction of hypervisor platforms. Often these discussions are very emotional, and the valid arguments rarely heard.
Many companies use old-style public folders, known as legacy public folders, on Exchange Server 2010. Often, the public folder hierarchical structures have grown uncontrollably for years. And not only in terms of data volume but also in the number of folders and the folder depth in the public folder hierarchy. For these reasons, many companies fear legacy public folder migration to modern public folders.