CTO! Guide January 2026: Azure Arc, AI Skills, and Custom AI Infrastructure

Azure Arc Portal Gets Major Overhaul

The updated Azure Arc portal represents a significant leap forward in hybrid and multi-cloud management. The redesigned landing page and guided onboarding process transform what was once a complex setup into an intuitive experience. The interactive questionnaire walks users through configuration options, while the unified machine onboarding flow eliminates the confusion of managing different resource types.

Navigation improvements bring clarity to previously cluttered interfaces, and the new dashboards offer adaptive summaries that surface actionable insights rather than just raw data. This shift from passive monitoring to active management means IT teams can focus on delivering business value instead of wrestling with complexity.

The portal enhancements address a critical pain point: scaling Azure Arc across large enterprises. Organizations can now onboard hundreds or thousands of resources without the operational overhead that previously made such deployments daunting.

AI Skills Development Takes Center Stage

Microsoft's partnership with higher education institutions through AI Skills Navigator and Microsoft Learn for Educators represents a strategic investment in the future workforce. These tools provide faculty with free, flexible training resources to integrate AI into their curricula, ensuring students graduate with practical, job-ready skills.

The Microsoft Student Ambassadors program creates a community-driven approach to learning, where students can share knowledge and build networks while developing technical expertise. Combined with free access to Microsoft 365 and LinkedIn Premium, these initiatives create a comprehensive ecosystem for lifelong learning.

What makes this particularly noteworthy is the focus on practical application rather than theoretical knowledge. Students gain recognized certifications that employers value, bridging the gap between academic preparation and industry requirements. This approach positions Microsoft as not just a technology provider but an education partner in the AI era.

DNS Troubleshooting Gets a Windows-native Upgrade

The comparison between nslookup and Resolve-DnsName reveals a critical insight for Windows administrators: the right tool matters. While nslookup remains popular for basic queries, its independence from the Windows DNS client resolver can lead to inaccurate results, especially when dealing with modern DNS features like DNSSEC and secure DNS.

Resolve-DnsName integrates directly with Windows DNS-CR, providing accurate results that reflect actual client behavior. Its support for advanced features and flexible parameters makes it ideal for automation and complex troubleshooting scenarios. The article's practical guidance helps administrators choose the right tool for their specific needs, whether they're diagnosing client issues or automating DNS management tasks.

This distinction becomes crucial in enterprise environments where DNS reliability directly impacts application performance and security.

DCQCN Powers Azure's RDMA Storage Infrastructure

Microsoft's implementation of Data Center Quantized Congestion Notification (DCQCN) demonstrates how sophisticated congestion control enables high-performance cloud storage. By combining DCQCN with Priority Flow Control and ECN-based feedback, Azure achieves line-rate RDMA performance across diverse hardware and network conditions.

The solution to interoperability challenges between NIC generations showcases Microsoft's engineering approach: rather than forcing standardization, they optimized DCQCN parameters and feedback mechanisms to work across the ecosystem. This flexibility ensures consistent performance regardless of underlying hardware variations.

Results speak volumes: up to 11% power savings at moderate loads, 1.5× performance-per-watt improvements at low loads, and near-zero packet loss. These metrics translate directly to cost savings and improved customer experience for Azure storage services.

Kerberos Security Gets a Major Overhaul

The phase-out of RC4 in Kerberos authentication marks a significant security milestone. Starting January 2026, RC4 becomes a non-default encryption type, with enforcement beginning April 2026 and rollback options until July 2026. This timeline gives organizations adequate preparation time while maintaining security momentum.

The introduction of new auditing tools helps identify dependencies before enforcement begins, reducing the risk of authentication failures. While RC4 remains supported for critical legacy needs, the clear migration path encourages organizations to modernize their authentication infrastructure.

This change reflects Microsoft's broader security strategy: gradual deprecation of vulnerable protocols while providing robust support for the transition. Organizations still dependent on RC4 have access to resources and support to ensure smooth migration.

Redis Key Management Gets Practical Tools

The Bash+LUA script solutions for Redis key statistics address a common operational challenge: understanding cache usage patterns. By providing tools to count keys by TTL and size thresholds, administrators can identify performance bottlenecks and optimize memory usage.

The warning about script impact on Redis workloads is crucial - these tools require scanning all keys, which can affect performance during execution. This transparency helps administrators plan maintenance windows and understand the trade-offs involved in gathering detailed statistics.

Practical parameters and usage instructions make these scripts immediately useful, while performance considerations ensure they're applied appropriately in production environments.

Azure Arc Server Forum Highlights Innovation

The January 2026 Azure Arc Server Forum showcased several exciting developments. The new machine management features in Azure Compute Hub promise to simplify hybrid server operations, while Windows Server Hot Patch updates address critical security needs with minimal disruption.

The preview of TPM-based onboarding represents a significant security enhancement, leveraging hardware-based authentication to strengthen Arc deployments. The recap of 2025 SQL Server announcements provides context for ongoing database modernization efforts.

These developments demonstrate Azure Arc's evolution from a connectivity solution to a comprehensive hybrid management platform.

Azure File Sync Expands with Arc Integration

The integration of Azure File Sync with Azure Arc marks a strategic move toward unified hybrid storage management. The expansion to four new regions - Italy North, New Zealand North, Poland Central, and Spain Central - addresses growing demand for regional data residency and improved performance.

Managed identities eliminate the manual credential management burden, reducing security risks and operational overhead. The removal of per-server costs for Windows Server Software Assurance customers using Azure Arc and File Sync agent v22+ makes hybrid file services more accessible to enterprises.

These changes position Azure File Sync as a scalable, secure solution for organizations managing distributed file services across on-premises and cloud environments.

User Delegation SAS Expands Beyond Blobs

The public preview of user delegation SAS for Azure Tables, Azure Files, and Azure Queues extends secure access patterns beyond Azure Blobs. By tying SAS tokens to user identities via Entra ID and RBAC, Microsoft enables more granular, delegated access to storage resources.

The no additional cost model and availability through REST APIs, SDKs, PowerShell, and CLI make this feature immediately accessible. Eligible storage accounts can use UD SAS without special settings, reducing deployment complexity.

This expansion reflects Microsoft's commitment to consistent security patterns across their storage services, enabling organizations to apply familiar access control models across their entire storage portfolio.

PostgreSQL on Azure VMs Gets Production-Ready

The Infrastructure as Code templates for deploying PostgreSQL on Azure VMs with Azure NetApp Files represent a significant advancement in database deployment automation. By eliminating manual configuration, these templates reduce deployment time from hours to minutes while ensuring consistency across environments.

Support for Terraform, ARM templates, and PowerShell provides flexibility for different team preferences and existing workflows. The enterprise-grade features, including optimized storage performance and enhanced security, make these templates suitable for production workloads.

Key benefits include consistent environments across development and production, rapid provisioning for agile development cycles, and cost efficiency through optimized resource utilization. The solution's support for AI/ML workloads and database migrations positions it well for modern application architectures.

Azure NetApp Files Object REST API Enables Analytics Innovation

The Azure NetApp Files object REST API's S3-compatible access to enterprise file data stored on Azure NetApp Files eliminates the need for data copying or restructuring. This dual-access approach allows analytics and AI platforms to operate directly on NFS/SMB datasets, preserving performance, security, and governance.

Integration scenarios with Azure Databricks and Microsoft OneLake demonstrate practical applications for organizations looking to streamline their data architectures. By minimizing data movement, organizations can accelerate real-time insights across analytics and AI workflows.

The technical implementation details and video guides provide clear paths for organizations to adopt this capability, while the focus on preserving existing data structures reduces migration complexity.

Bicep Azure Verified Modules Modernize Landing Zones

The release of Azure Verified Modules for Platform Landing Zones using Bicep provides a modular, customizable, and officially supported approach to Infrastructure as Code. With 19 independently managed modules, organizations can build landing zones that precisely match their requirements while maintaining Microsoft's best practices.

The framework's support for full configuration and integration with Azure Deployment Stacks improves resource lifecycle management. By replacing classic ALZ-Bicep, which will be deprecated by 2027, Microsoft provides a clear migration path for existing users.

Key benefits include end-to-end customization, faster innovation through independent module updates, and modernized parameter files that align with enterprise best practices. The independent policy management capability allows organizations to maintain governance while enabling development teams to move quickly.

Adaptive CPU Uncore Power Management Boosts Efficiency

Microsoft's adoption of adaptive CPU uncore power management through Efficiency Latency Control (ELC) co-designed with Intel for Xeon 6 processors demonstrates how hardware-software co-design delivers tangible benefits. ELC enables dynamic adjustment of uncore frequency based on CPU utilization, improving power efficiency without sacrificing performance.

Real-world tests showing up to 11% power savings at moderate loads and 1.5× performance-per-watt improvements at low loads translate directly to operational cost savings. This approach allows Azure to deploy more servers within existing datacenter power constraints, enhancing sustainability.

The focus on power and thermal management throughout the engineering process ensures reliable operation at global scale, supporting services like Copilot and Teams while minimizing environmental impact.

AMD Turin Processors Power New VM Series

The general availability of Azure's new AMD-based Da/Ea/Fasv7-series Virtual Machines powered by 5th Gen AMD EPYC 'Turin' processors delivers significant performance improvements. With up to 35% better price-performance than previous AMD v6 VMs, these instances offer compelling economics for diverse workloads.

The VMs cater to general, memory, and compute-intensive tasks with enhanced security and flexible configurations. Availability across multiple Azure regions ensures organizations can deploy these instances close to their users and data sources.

Customer and technology partner praise for performance and efficiency improvements validates Microsoft's hardware strategy and provides confidence for organizations considering AMD-based workloads.

Defender for Endpoint Linux Offboarding Gets Streamlined

The Bash script for determining Microsoft Defender for Endpoint onboarding or offboarding state on Linux devices addresses a critical operational need. Since the Defender portal can take up to 7 days to update offboarding status, this script provides immediate visibility into endpoint state.

By checking key indicators such as the onboarding file, Defender package installation, and service status, the script outputs whether the device is "ONBOARDED" or "OFFBOARDED." This capability streamlines endpoint management and troubleshooting, particularly important in large-scale deployments.

The ability to deploy the script at scale via Linux management tools and run it remotely from the Live Response console provides flexibility for different operational models and environments.

Agent Identities Get Conditional Access Controls

Microsoft Entra's introduction of Agent Identities for AI systems, extended with Conditional Access controls, represents a significant step in securing AI-driven workflows. While currently limited compared to human user controls - only allowing blocking and risk assessment during token acquisition - this foundation enables future enhancements.

The limitations reflect the reality of machine-driven authentication methods, but even minimal controls help prevent compromised agents, enforce separation of duties, and manage AI sprawl. The exclusion of Agent Blueprints from Conditional Access governance highlights the need for additional security measures for certain AI components.

Future enhancements are expected, but for now, Conditional Access remains a minimal, identity-focused security layer for AI agents, providing a starting point for organizations to secure their AI infrastructure.

Azure CycleCloud Workspace for Slurm Gets Enhanced

The 2025.12.01 release of Azure CycleCloud Workspace for Slurm introduces integrated Prometheus monitoring with managed Grafana dashboards, providing real-time performance insights for HPC clusters. Entra ID Single Sign-On enhances security while simplifying user access, and support for ARM64 compute nodes expands hardware options for diverse workloads.

Compatibility with Ubuntu 24.04 and AlmaLinux 9 ensures organizations can use their preferred Linux distributions while benefiting from the latest features and security updates. These enhancements streamline HPC cluster management and improve security, empowering technical teams to build scalable and efficient environments.

The focus on simplifying monitoring setup and user access reinforces Azure's commitment to flexible, secure, and innovative HPC solutions for scientific and technical communities.

Neural Concept Achieves Record-Breaking AI Performance

Neural Concept's achievement using Azure HPC infrastructure demonstrates the industrial impact of scalable, AI-driven engineering workflows. By leveraging MIT's DrivAerNet++ dataset, their geometry-native Geometric Regressor outperformed all previous methods in predicting automotive aerodynamic performance.

The transformation of 39TB of CFD data into a production-ready model within a week showcases the power of cloud-scale computing for AI development. Customers have realized up to 30% faster development cycles and $20M savings per 100,000 vehicles, demonstrating tangible business value.

This success story validates Azure's HPC capabilities for demanding AI workloads and provides a blueprint for other organizations looking to apply similar approaches to their engineering challenges.

Intune my Macs Simplifies macOS Management

Intune my Macs, an open-source starter kit from Microsoft, streamlines macOS management proof of concepts using Intune. By deploying over 31 recommended enterprise configurations - including security, compliance, identity, and applications - via a single PowerShell script, it reduces setup time to minutes.

The project's dry-run mode by default allows organizations to evaluate configurations before applying them, reducing risk during proof of concept phases. Practical configuration examples and documentation help organizations quickly understand Intune's capabilities for macOS environments.

This tool is ideal for learning, testing, and customizing Intune policies for macOS environments, saving significant time and effort while providing a solid foundation for enterprise deployments.

Microsoft Engineers AI Infrastructure from Silicon Up

The article detailing how Microsoft engineers its AI infrastructure from the ground up reveals a comprehensive approach to building purpose-built systems. By designing custom silicon, servers, accelerators, and data centers as an integrated system optimized for performance, power efficiency, and cost, Microsoft ensures their infrastructure meets the specific demands of AI workloads.

Custom chips like Cobalt 200 and the Maia AI Accelerator platform demonstrate Microsoft's commitment to hardware innovation. Advanced cooling solutions and end-to-end system integration ensure reliable, efficient AI workloads at global scale, powering services like Copilot and Teams.

The engineering process involving close coordination between hardware and software development, from silicon design to datacenter deployment, prioritizes power and thermal management throughout, ensuring sustainable operation at massive scale.

Maia 200 Sets New Standard for AI Inference

Maia 200, Microsoft's first custom AI inference accelerator, represents a significant advancement in cloud-native AI infrastructure. With 30% better performance per dollar than previous hardware, it delivers efficiency and scalability for Azure's inference workloads.

Optimized for narrow precision arithmetic and large language models, Maia 200 supports high-throughput, low-latency inference while integrating seamlessly with Azure's cloud infrastructure and developer tools. Its innovative interconnect and software stack enable reliable, scalable multi-tenant AI deployments.

Powering workloads like GPT-5.2 in Microsoft Foundry and 365 Copilot, Maia 200 sets a new standard for cost-effective AI inference, demonstrating Microsoft's ability to innovate across the entire technology stack from silicon to services.

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This month's CTO! guide showcases Microsoft's comprehensive approach to infrastructure and security, from silicon design to cloud services. The emphasis on integration, efficiency, and security across the technology stack positions Microsoft to meet the evolving demands of modern enterprises while maintaining their commitment to innovation and customer success.