I have setup Postfix and Dovecot.
Microsoft outlook tells me it cannot find the SMTP server. I thought dovecot would handle all the deliveries? Do I need to allow postfix to listen to external connections on port 25 too?
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We can divide mail management in two parts, mail transfer and mail delivering. Postfix is a Mail Transfer Agent meaning that it will move emails from one server to another using the SMTP protocol. Dovecot is a Mail Delivery Agent which will deliver the received emails to your mail client using the IMAP or POP3 protocols.
When sending an email from your email client, you will directly talk to your MTA while to get new emails, you speak with your MDA.
So, yes you need Postfix if you want to send emails for this email account.
Dovecot does mail delivery from the server to your local inbox by using the POP3 or IMAP protocols. Postfix does mail transfer towards email servers (from your client or other servers) by using the SMTP protocol.
A few things to notice:
Normally you would prefer IMAP over POP3 for mail delivery as it is a more advanced protocol and allows synchronizing of the local mail box with the remote one on the server. POP3 usually simply downloads the mailbox and removes it from the server.
All these protocols are plain text, meaning that anything going through them (including your usernames and passwords to login into the server) can be read on the wire. It is highly advisable to setup Dovecot for SSL only connection, either by using IMAPS and/or POP3S as well as SMTPS, either by escalating all plain text connections to STARTTLS.