We have received consistent feedback from our customers that the ability to reject messages for invalid recipients at the service network perimeter is important. We are aggressively working to design a solution that will make Directory Based Edge Blocking (DBEB) available within Exchange Online Protection (EOP).  This functionality is targeted to be added to the service in the first quarter of 2014.

In the meantime, here are some suggested configurations to help customers who want this type of capability until the service is able to offer recipient validation:  

  • Enabling Recipient filteringon-premises on your Exchange servers.  This is the recommended solution until the EOP functionality is available. This essentially adds one step to the process of communications.  EOP will communicate with your Exchange servers and then Exchange recipient filtering can handle as configured:  
    • Customer Concern:  Increased load on on-premises servers?
    • Microsoft response:  Impact to the customer’s servers should be minimal. The Recipient Validation feature will reject recipients after the RCPT TO:  command within the SMTP conversation well before accepting the message into the org.  Because of this the resources expended are very minimal and the cost of NDR generation is on the EOP side which will result in minimal impact to your on-premises servers.
  • Transport rules can be used to mimic the behavior as well, and would have to be tested to each customers' desired configuration.

Wendy Wilkes
Senior Program Manager
Office 365 Customer Experience

Updated 11/21/2013 to include the target release timeframe.