One Year of Azure Stack HCI 23H2

It’s now been a full year since Azure Stack HCI 23H2 went generally available in February 2024, and what a year it’s been. The platform has gone through a complete rebrand, multiple release trains, a new OS baseline, and a fundamental repositioning in the market. This feels like the right moment to pause, look back, and take stock of where we’ve come from and how the year has played out.

The Good

Let’s start with what’s worked well, because there’s plenty to be positive about.

The architectural shift from a cloud-connected OS to a full hybrid cloud solution was the right call. The Arc Resource Bridge, the Azure Arc Extensions, the ability to deliver new features independently of the OS update cycle, all of this has proven its value over the past twelve months. Features have landed faster, fixes have been deployed more rapidly, and the overall pace of innovation has been noticeably higher than anything we saw in the 20H2 through 22H2 era.

The deployment experience improved dramatically. If you deployed 20H2 or 22H2, you’ll remember the process being heavily manual, requiring significant expertise, and with plenty of opportunity for things to go sideways. The 23H2 deployment experience, while not without its own challenges, was a huge step forward. Automated, guided, and repeatable. For Dell AX customers specifically, the integration of the Solution Builder Extension into the deployment flow has meant that our customers get a single, integrated deployment that covers both Microsoft and Dell components.

Azure portal based management has matured significantly. A year ago, the portal experience was functional but sparse. Over the course of the year, the VM management, monitoring, update management, and policy capabilities have all improved to the point where for many day-to-day tasks, you genuinely don’t need to touch on-premises tooling.

Security out of the box has been excellent. WDAC enforcement, HVCI, the security baseline, Credential Guard, all enabled by default. This is how infrastructure should be delivered. Secure first, with options to adjust when you need to, rather than insecure by default with security as an afterthought.

The Challenges

It wouldn’t be an honest retrospective without acknowledging the rough spots, and there have been some.

Early adopters hit more bugs than anyone would have liked. The first few months of 23H2 in production surfaced issues around update reliability, Storage Spaces Direct thin provisioning, and some edge cases in the deployment process that required manual intervention. Microsoft has addressed the vast majority of these through subsequent updates, but for customers who deployed in the first wave, it was a bumpy ride.

The learning curve for partners and customers who were used to the 22H2 model was steeper than anticipated. The architectural changes, while beneficial, meant that existing knowledge and practices around managing Azure Stack HCI needed to be significantly updated. Training materials, documentation, and community knowledge took time to catch up.

Migration from 22H2 to 23H2 was not a simple upgrade. It was effectively a redeployment, which meant that customers who were running 22H2 in production had to plan and execute what was essentially a fresh deployment and workload migration. For large environments, this was a significant undertaking.

The Dell Perspective

From a Dell AX perspective, the year has been about maturing the solution offering. Our Solution Builder Extension has gone through multiple iterations, improving the lifecycle management experience, expanding the hardware support matrix, and tightening the integration between Dell infrastructure management and the Azure Local management plane.

The Dell AX system positioning as the go-to solution for Azure Local deployments has become clearer and simpler to communicate over the course of the year, and the investment in lifecycle management, deployment automation, and support integration continues to mature.

I’ve spoken to dozens of customers over the past year who have deployed Dell AX with Azure Stack HCI 23H2, and the common thread in their feedback is that once deployed and past the initial learning curve, the operational experience is genuinely good. The combination of Azure management, Dell hardware lifecycle automation, and the integrated support queue between Dell and Microsoft provides a level of confidence and simplicity that wasn’t possible with prior generations.

What’s Changed

It’s worth noting just how much the landscape around Azure Stack HCI / Azure Local has changed in twelve months. A year ago, VMware was still the unquestioned default for on-premises virtualisation for most enterprises. The Broadcom acquisition has since disrupted that in ways that nobody fully anticipated. Azure Local has gone from being an interesting alternative to a primary platform choice for a growing number of organisations.

The rebrand to Azure Local at Ignite reflected and reinforced this shift. The platform is no longer positioned as a niche HCI solution. It’s positioned as cloud infrastructure for distributed locations, and that broader framing opens doors that weren’t previously available.

Looking Ahead

Year two is going to be about scale, maturity, and expanding the use cases. The 24H2 OS baseline is here, the new versioning model is in place, and the feature pipeline shows no signs of slowing down. GPU support for AI workloads, improved AKS capabilities, sovereign cloud scenarios, there’s a lot on the horizon.

For those who deployed in year one, you’ve been through the hardest part. The platform is more stable, the tooling is more mature, and the ecosystem around it is stronger. For those still evaluating, the platform you’d deploy today is meaningfully better than the one that launched twelve months ago, and it’ll be better again in another twelve months.

It’s been a good year. An imperfect one, certainly, but a good one. Here’s to year two.