Basic Authentication Deprecation in Exchange Online – September 2022 Update

Hi,

I am trying to confirm that our services will still be able to send email via SMTP after Basic Authentication in disabled. 

I configured exchange online using the PS commands:

Set-TransportConfig  -SmtpClientAuthenticationDisabled:$false

Set-AuthenticationPolicy -Identity <PolicyID> -AllowBasicAuthSmtp:$false

I understood that this will disable Basic Authentication but still allow SMTP Client Authentication using SMTP AUTH

However, when I try and authenticate with the smtp.office365.com using the SMTP LOGIN SASL Mechanism I get the response:

Is the SMTP LOGIN SASL Mechanism considered to be Basic Authentication?

What SMTP AUTH Mechanisms are available to services when it is disabled? The SMTP Server says it supports the mechanisms LOGIN XOAUTH2 but then responds that basic authentication is disabled.

Regards,

David