Windows Azure is a cloud services operating system that serves as the development, service hosting and service management environment for the Windows Azure platform. Windows Azure provides developers with on-demand compute and storage to host, scale, and manage web applications on the internet through Microsoft datacenters. 
Windows Azure is a flexible platform that supports multiple languages and integrates with your existing on-premises environment. To build applications and services on Windows Azure, developers can use their existing Microsoft Visual Studio expertise. In addition, Windows Azure supports popular standards, protocols and languages including SOAP, REST, XML, Java, PHP and Ruby. Windows Azure is now commercially available in 41 countries. 
Windows Azure Tools for Microsoft Visual Studio extend Visual Studio 2010 to enable the creation, configuration, building, debugging, running, packaging and deployment of scalable web applications and services on Windows Azure.
Windows Azure SDK and Windows Azure Tools for Microsoft Visual Studio is package you'll need when developing web apps and services for the Azure platform.

Requirements:
· Required Software for Windows Azure SDK:
· NET Framework 3.5 SP1
· IIS 7.0 (with ASP.NET, WCF HTTP Activation, Static Content, IIS Management Console and optionally CGI)
· Microsoft SQL Server Express 2008 or Microsoft SQL Server Express 2005 or Microsoft SQL Server 2008 or Microsoft SQL Server 2008
· Hotfix: Correct WCF metadata when hosting behind a load balancer
· Hotfix: Support for FastCGI (not required for Windows 7)
· Required Software for Visual Studio:
· Hotfix: Enable Windows Azure IntelliTrace on 32-Bit OS (not required for x64 OS).
· Hotfix: Improve Visual Studio Stability (not required for Windows 7).
· IIS 7.0 URL Rewrite Module
· Windows PowerShell

What's New in This Release:
· Virtual Machine (VM) Role (Beta):Allows you to create a custom VHD image using Windows Server 2008 R2 and host it in the cloud.
· Remote Desktop Access: Enables connecting to individual service instances using a Remote Desktop client.
· Full IIS Support in a Web role: Enables hosting Windows Azure web roles in a IIS hosting environment.
· Elevated Privileges: Enables performing tasks with elevated privileges within a service instance.
· Virtual Network (CTP): Enables support for Windows Azure Connect, which provides IP-level connectivity between on-premises and Windows Azure resources.
· Diagnostics: Enhancements to Windows Azure Diagnostics enable collection of diagnostics data in more error conditions.
· Networking Enhancements: Enables roles to restrict inter-role traffic, fixed ports on InputEndpoints.