History settings and classic Hangouts
If both classic Hangouts and Hangouts Chat are turned on for an organizational unit, the classic Hangouts history on/off settings are used in chats if participants use a mix of classic and new Chat. For example, if you create a direct message with someone who uses classic Hangouts, the classic Hangouts history settings are used, not the new Hangouts Chat history settings.
If the history settings are different for chat participants in different organizational units, the chat conversation can’t be created. This ensures the settings for each organizational unit are honored.