That basically tells Outlook clients "you can use modern auth". As this is Outlook for Windows we are talking about - there is also a tenant setting as mentioned under Outlook section in that blog post.
So first thing that needs to be understood is - which protocol is Outlook using to connect to Exchange Online? Is basic auth turned off for it? (running the diagnostics from that blog post will show you) Are those Outlook clients using POP/IMAP as a protocols or not? (this will depend on how profiles are created) There is a per-protocols modern auth setting, which is what we are turning on for tenants starting October 1st when that happens, basically there is no more basic auth for a particular protocol. Yeah so you need to clarify what it means that "modern authentication has been turned on".
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