When you move Windows Servers into Azure, name resolution has to work in three directions: between Azure VMs, from Azure to on-premises, and from on-premises into Azure. Azure gives every virtual network (VNet) a built-in resolver at the special address 168.63.129.16, but that resolver only answers for names Azure knows about. Azure DNS private zones and Azure DNS Private Resolver are the two services that let you extend it cleanly.
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