For all other racks with tenant VMs you are running within your Azure Stack infrastructure, the high availability design is similar to Azure as the tenant itself needs to provide itself with configuring availability sets in different regions in general. Because there will only be one region possible with Azure Stack in version 1, this cannot be the solution. The provider needs to set up a backup and restore process with his customer using Data Protection Manager (DPM) or another third-party backup solution.

The most important thing is to define SLAs with your tenants that will make sure that the customer will not use their VMs and thus, give them a good balance for restoring the resources. On the other hand, there needs to be the option to react as a service provider from the manpower side.