I am on a cloud enviroment and I am getting the error in the subject in VSC when I try to publish in our sandbox
In local enviroment it works fine.
In the sandbox, extension is in status "Uninstalled". When I install it from there it gets installed without any problems.
I have also tried to stop and start service (with the trick of installing/uninstalling the app. insights key) but now it seems it does not need to restart cloud service, so I couldnt do this.