Microsoft Azure Stack HCI Now a Subscription-Based Service

After several years of less-than-stellar success in the crowded HCI space, Microsoft Azure Stack HCI is being transitioned to a subscription offering with its own operating system, Azure Stack HCI 20H2.

ITPro Today

September 14, 2020

4 Min Read
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Microsoft has changed the way Azure Stack HCI is sold and consumed, moving it out of Windows Server 2019 and making it a software subscription that is managed and billed through the same Azure portal as other Microsoft cloud services an IT organization uses. After several years of less-than-stellar success in the crowded HCI space, Microsoft is leveraging its HCI technology to create another option for the on-premises portion of an Azure hybrid cloud.

In a recent series of articles, we compared on-premises hybrid cloud solutions from the big three public cloud vendors: Microsoft, Google and AWS. In the write-up about Microsoft, Azure Stack Hub was the product of focus, since it runs most of the applications available on the Azure cloud and is managed through the same Azure portal. At that time (spring 2020), Azure Stack HCI was still a software solution that OEMs and Microsoft partners sold and deployed as a traditional HCI cluster. Now, Microsoft Azure Stack HCI has transitioned to a cloud-based subscription offering with its own OS, Azure Stack HCI 20H2, that is currently in public preview with general availability expected before the end of 2020.

HCI as an Azure Service

Instead of selling the HCI software as a license, Microsoft has created a subscription pricing model that’s offered through Azure cloud, currently set at $10 per core per month. HCI clusters are set up and managed by Windows Admin Center and can be viewed through the Azure portal, like Azure Backup, Site Recovery or other Azure services.


Microsoft Azure Stack HCI is no longer part of Windows Server 2019. The new OS, Azure Stack HCI 20H2, will run Storage Spaces Direct, the SDS layer that creates the virtual storage pool between nodes and gives Azure Stack HCI its scale-out architecture. Designed for VM-based workloads, this new OS includes Hyper-V, but can run Microsoft SQL Server bare metal as well.

The new Azure Stack HCI also will include several new features compared with the previous Azure Stack HCI product.

New Features

Microsoft has added several new features to Azure Stack HCI, including automated disaster recovery. Using synchronous replication, customers can create a stretched cluster between local or remote nodes. Stretched clustering is something that enterprise IT typically considers a requirement, and it’s a feature that most HCI products currently include. However, stretched clusters only ensure that a copy of data is resident in another location. With automatic failover, Microsoft has created a real DR solution.

Microsoft has improved the process that resynchronizes data volumes between nodes, reducing the time required for rebuilds after updates, failures or hardware changes. Driver and firmware updates are now included in the Azure Stack OS upgrades, eliminating some manual processes. Also, Azure Stack HCI now includes BitLocker encryption and support for GPUs.

The new Microsoft Azure Stack HCI will be available as a software solution that’s combined with “validated” hardware from 20-plus vendor partners, similar to the way the old Azure Stack HCI was sold. Customers can also buy a turnkey appliance from a limited number of OEMs, including Dell and Lenovo. Microsoft is also offering a “DIY” option, letting customers use their own hardware as long as it matches one of the validated solution configurations.

Why This Is Different

HCI is becoming a popular solution for the on-premises portion of a hybrid cloud. It incorporates a number of cloud-like characteristics that IT organizations need, such as flexibility to support a range of workloads, plus easy deployment and scaling. HCI’s software-defined architecture also supports connectivity to other platforms and provides simple, self-service operation for end users.

All the HCI vendors are pursuing a hybrid cloud model with features that connect their on-premises clusters to the public cloud. To do this they're working with AWS, Google (and Microsoft) to provide backup, disaster recovery and other cloud-based services and add to their hybrid cloud offerings. Azure Stack HCI doesn't need to have a deal worked out with Azure to create this connection to the public cloud. Microsoft Azure Stack HCI is integrated with Azure cloud and enables users to employ Azure services through their on-premises infrastructure.

In addition to an on-premises hybrid cloud solution, Microsoft Azure Stack HCI can also be a stand-alone hyperconverged cluster. As standard infrastructure, it can simplify what a company buys to support VMs in the data center, departmental computing, VDI, remote offices, edge locations, etc. Plus, any of these deployments can run available Azure services. Azure Stack HCI is also built on the same Storage Spaces Direct architecture as the Azure cloud. This would indicate that further integration between Azure Stack HCI and Azure is coming. For more information on the new Azure Stack HCI, see this Industry Insight from Evaluator Group.

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