In setting up an Office365 pilot for a customer the other day I found it doesn’t give an option to choose external relay like in BPOS. If you are piloting Office365 with your domain, read-on how to avoid any service interruption to any existing office 365 users. 
After adding domain, you will be provided with CNAME record to validate domain ownership. Adding the CNAME record with your DNS provider will create the domain in Office 365 as hosted by default instead of external relay as in BPOS. If you have already created some test users in Office 365 they will not be able send mail to users in your on-premises users as a result. Be sure to change the domain type to “shared” from the Exchange control panel which can be accessed from https://outlook.com/ecp/nameofdomain or from the Office 365 portal under Exchange manage.
After adding domain, you will be provided with CNAME record to validate domain ownership. Adding the CNAME record with your DNS provider will create the domain in Office 365 as hosted by default instead of external relay as in BPOS. If you have already created some test users in Office 365 they will not be able send mail to users in your on-premises users as a result. Be sure to change the domain type to “shared” from the Exchange control panel which can be accessed from https://outlook.com/ecp/nameofdomain or from the Office 365 portal under Exchange manage.
