When you try to create a federation trust between the on-premises Microsoft Exchange environment and Microsoft Office 365, you receive the following warning message:
Forest 'New Forest' needs to be updated
However, when you click the link to Microsoft Update to download the latest version, Microsoft Update reports that your current version of the Exchange Management Console is up to date.
This issue occurs if the current on-premises Exchange Management Console (EMC) is incompatible with the version of the EMC that's used by the Datacenter edition of Exchange in Office 365.
Important This section, method, or task contains steps that tell you how to modify the registry. However, serious problems might occur if you modify the registry incorrectly. Therefore, make sure that you follow these steps carefully. For added protection, back up the registry before you modify it. Then, you can restore the registry if a problem occurs. For more information about how to back up and restore the registry, click the following article number to view the article in the Microsoft Knowledge Base:
322756 How to back up and restore the registry in Windows
To work around this issue, modify the following registry subkey on the server where you want to run the Exchange Management Console. This change prevents a version comparison. To do this, follow these steps:
Open Registry Editor.
Locate and then right-click the following registry subkey: