Yep, it looks like, by popular demand Microsoft is enabling the Windows Azure Platform inside of your datacenter.

Windows Azure Appliance was announced on the keynote of the Worldwide Partner Conference, here is a brief description of the functionality:

Windows Azure™ platform appliance is a turnkey cloud platform that customers can deploy in their own datacenter, across hundreds to thousands of servers. The Windows Azure platform appliance consists of Windows Azure, SQL Azure and a Microsoft-specified configuration of network, storage and server hardware. This hardware will be delivered by a variety of partners.

Nice!