from Adam Gordon:
I hope all is well. Great question(s) about a very important aspect of using Azure. Let's see what we can do to help you get a better understanding of the basics, as well as the actual process that you will use.
The most important things for you to be aware of are the pre-work items that have to be done to prep the VM before you capture the image. See below:
Prepare a Windows VHD or VHDX to upload to Azure:
Prepare a Windows VHD to upload to Azure
How to prepare a Windows VHD or VHDX before uploading to Azure
After all the prep work above is done, see the instructions below to capture the VHD image, upload it to Azure and then use it as your reference image:
Create a managed Azure VM from a generalized on-premises ...
Upload a generalized VHD to Azure and use it to create new VMs, in the Resource Manager deployment model.
With regards to the physical machine vs virtual machine as the basis for the image, if you are gong to be using the image to create virtualized infrastructure that will be hosted in Azure and run there, then there are no driver issues to be concerned about, as you will be using virtual machines, not physical ones.
Anytime that you create a VM, or an image as a VHD(X) to base VM's off of, you remove the need for hardware specific drivers for the most part, unless you are connecting specific hardware as a "pass through" directly via the underlying host. If that is the case, then you would need to ensure that the required drivers are made available.
I hope that this points you in the right direction and clarifies things for you. If you have any more questions, please let me know. "
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