This same question was asked here 9 months ago without any answer:

https://community.databricks.com/s/question/0D58Y000096VjKrSAK/managedlibraryinstallfailed-when-chan...

I was using runtime 9.1, and then upgraded it to 12.1, I was installing XlsxWriter using the cluster config GUI in the libraries page. It was working fine, after upgrade i can't install any libraries anymore.

With 12.1 i get this message, weird thing is that if use the web terminal and run a pip install XlsxWriter it works fine.

java.lang.RuntimeException: ManagedLibraryInstallFailed: org.apache.spark.SparkException: Cluster library installation failed on the driver because the filesystem is not ready or has been disabled. If the problem persists after a few minutes, try restarting the cluster, or contact Databricks support. for library:PythonPyPiPkgId(xlsxwriter,None,None,List()),isSharedLibrary=false