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It can integrate with SQL Server, though Azure AppFabric is a service bus that allows applications within your LAN to communicate with Azure clouds; it handles things like authentication, security, etc. "Dallas" is a marketplace for applications and services deployed on Windows Azure.
Azure Websites are, by far, the easiest, cheapest, and fastest method of getting your application to the cloud. Websites give you the least amount of configuration control over your application, which is perfect for simple web applications that do not require more complex configurations for scaling and data processing.
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