Why does an arbiter need to be located outside the cluster?

[curioustech123]

I have read the requirement that an arbiter application must run outside the 2-node cluster. But I am curious to know what is the reason behind this?
For instance, when one node in a cluster goes, down then all VMs are still up due to the storage IP failover to the second node. 
So why cant the arbiter VM stay online in this scenario and continue to function? Why does it take down the cluster?

[NeetSat · Accepted solution]

Hi Curioustech123
Good day. 

The reason for Arbiter to be outside of the federation for the 2 Node cluster, is due to a fact, that Arbiter does the important work of providing its vote to the quorum on the cluster. 
So with 2 Node cluster, you already have 2 Nodes with 50% as the vote. 
Now with Arbiter installed and configured, the cluster sees 3 objects (Arbiter 33.33% and the other 2 Nodes at 33.33%)
Now when the host goes down, and if the Arbiter is within the same host inside the cluster, there is no way, Arbiter can even vote to provide the balance to the cluster quorum, which always have to be above 50% and not less or equal to 50%. 

So here in this case, with the vSphere HA into effect, the HA will shutdown the VM and then try to bring it up on the other host, but the cluster quorum is still less than 50%, which now puts the cluster into a dangerous situation and it may not come up at all with the one node down. 

So thats the main reason behind, the Arbiter, only for a 2 Node cluster, always has to be outside the Federation. 

Regards.

[curioustech123]

@NeetSat 
Thank you so much. That makes sense!

[NeetSat]

Hi Curioustech123,
Glad to know, I was able to answer your query.  
If you are satisfied with the answer then kindly click the "Accept As Solution" button for the most helpful response so that it is beneficial to all community members.

Regards.