Implement Azure Extended Network

2.1 Site-to-Site (S2S) VPN Connectivity

📘Microsoft Azure Networking Solutions (AZ-700)


1. What is Azure Extended Network?

Azure Extended Network allows on-premises workloads to be connected to Azure virtual networks (VNets) in a way that feels like they are part of the same Azure network.

In simple terms:

  • Azure networking capabilities are extended to on-premises environments
  • On-premises workloads can:
    • Use Azure IP addressing
    • Communicate securely with Azure VNets
    • Be managed and monitored through Azure

This is commonly used with:

  • Site-to-Site VPN
  • Azure Stack HCI
  • Azure Arc
  • Azure Virtual Network Gateway

📌 Exam focus: Azure Extended Network is about extending Azure networking to on-premises environments using VPN connectivity.


2. Why Azure Extended Network is Needed

Azure Extended Network is used when:

  • Some workloads must stay on-premises
  • Azure networking services are still required
  • Secure and private connectivity is needed
  • Centralized Azure management is required

With Azure Extended Network:

  • On-premises systems behave like Azure-connected systems
  • Azure policies, monitoring, and routing can be applied

3. Key Components of Azure Extended Network

To implement Azure Extended Network, you must understand these core components:


3.1 On-Premises Network

This is the local IT environment that includes:

  • Servers
  • Virtual machines
  • Network devices
  • Local IP address ranges

📌 These IP ranges must be defined correctly and must not overlap with Azure VNets.


3.2 Azure Virtual Network (VNet)

The Azure VNet is:

  • The private network in Azure
  • Where Azure resources such as VMs are deployed

Key points:

  • Must have a defined address space
  • Must not overlap with on-premises IP ranges
  • Acts as the Azure side of the extended network

3.3 Azure Virtual Network Gateway

This is a mandatory component.

The Virtual Network Gateway:

  • Connects Azure VNet to on-premises networks
  • Uses IPsec/IKE VPN tunnels
  • Encrypts all traffic

Gateway types:

  • VPN Gateway (used for S2S VPN)
  • Route-based gateway is required

📌 Policy-based gateways are not supported for Azure Extended Network


3.4 Local Network Gateway

The Local Network Gateway represents:

  • The on-premises VPN device in Azure

It includes:

  • On-premises public IP address
  • On-premises IP address ranges

📌 Azure uses this information to know where to send traffic.


3.5 Site-to-Site VPN Connection

This creates a secure tunnel between:

  • Azure Virtual Network Gateway
  • On-premises VPN device

Important points:

  • Uses IPsec/IKE encryption
  • Always-on connection
  • Supports routing between Azure and on-premises networks

4. How Azure Extended Network Works

The process works like this:

  1. Azure VNet is created
  2. Virtual Network Gateway is deployed in Azure
  3. Local Network Gateway is created
  4. Site-to-Site VPN connection is established
  5. On-premises workloads can communicate with Azure VNets
  6. Azure networking services are extended to on-premises systems

📌 From a networking perspective, Azure and on-premises act as one connected network.


5. Addressing and Routing Requirements

This is very important for the exam.

5.1 IP Address Planning

  • Azure VNet address space must be unique
  • On-premises IP ranges must not overlap
  • All subnets must be clearly defined

Overlapping IP addresses will:

  • Break routing
  • Prevent VPN connection from working

5.2 Routing

Azure Extended Network uses:

  • System routes
  • User-defined routes (UDRs) if required

Traffic flow:

  • Azure knows on-premises routes via Local Network Gateway
  • On-premises network knows Azure routes via VPN device configuration

6. Security Considerations

Azure Extended Network provides strong security by default:

6.1 Encryption

  • Uses IPsec/IKE
  • Data is encrypted in transit

6.2 Authentication

  • Uses shared key (pre-shared key)
  • Must match on both Azure and on-premises VPN device

6.3 Network Isolation

  • VNets are isolated by default
  • Only allowed traffic flows through the VPN

7. Monitoring and Management

Azure Extended Network can be monitored using Azure tools:

  • Azure Monitor
  • Network Watcher
  • VPN connection status
  • Tunnel health and diagnostics

This allows:

  • Visibility into connectivity issues
  • Performance monitoring
  • Troubleshooting VPN failures

8. Limitations and Important Exam Notes

You must remember these exam-critical points:

  • Requires route-based VPN gateway
  • Policy-based VPN is not supported
  • IP address overlap is not allowed
  • Requires stable internet connectivity
  • VPN gateway deployment takes time
  • Throughput depends on gateway SKU

9. When to Use Azure Extended Network (Exam Context)

Azure Extended Network is appropriate when:

  • Azure networking must be extended to on-premises systems
  • Secure private connectivity is required
  • Workloads cannot move fully to Azure
  • Centralized Azure networking control is needed

10. Key Exam Keywords to Remember

Make sure students recognize these terms:

  • Azure Extended Network
  • Site-to-Site VPN
  • Virtual Network Gateway
  • Local Network Gateway
  • Route-based VPN
  • IPsec/IKE
  • Non-overlapping IP ranges
  • Secure hybrid connectivity

11. One-Line Exam Summary

Azure Extended Network extends Azure virtual networking to on-premises environments using Site-to-Site VPN with secure, encrypted, route-based connectivity.

Buy Me a Coffee