DIGEST-MD5 what is good for?

DIGEST-MD5 sasl auth mech require OpenLDAP to store clear text passwords in the directory.

So you could wonder if it is worth implementing it.

DIGEST-MD5 protects passwords from sniffing even if an attacker could dump the whole network traffic. On the other hand, if network traffic is not ciphered a sniffer could eavesdrop the directory data.

The use case can't be about sensible data because if you plan to store in directory data which is supposed to be read only by authorized people, you are going anyhow to implement SSL or StartTLS. So you have no need to protect passwords on the wire as the traffic on the wire is encrypted.

Odd are good that if you have public data you are not asking authentication (anonymous access is enough). So DIGEST-MD5 is useless either.

What about a directory holding public data (work telephone number, for instance), with anonymous read access but authenticated update by selected people only?

I think this is the great use case for DIGEST-MD5: a directory that can be read by anonymous readers, without SSL nor StartTLS. Authorized users can update directory with plain text data but still userpassword is safe from sniffing.