Azure SQL Database is a service at the database level that delivers predictable performance, scalability with no downtime, business continuity, and data protection. Azure SQL Database is designed to deliver predictable database performance with very low levels of administration for performance at a variety of predictable levels. Microsoft automatically configures, patches, and upgrades the database for you. Microsoft provides an availability SLA of 99.99 percent.
In contrast to Azure virtual machines, with SQL Database you are guaranteed a certain level of performance, regardless of usage by other users. Predictable performance in Azure SQL Database is delivered based on service tiers, from Basic to Premium, with different levels of performance and capabilities both within and across tiers to support lightweight to heavyweight database workloads. The amount of performance you get on each tier is represented as a number of DTUs. A DTU is a database transaction unit and represents a combination of compute, database I/O, and memory resources. A certain amount of these resources is guaranteed at each service tier level. Furthermore, there are maximum limits for each performance level for sessions, concurrent logins, concurrent requests, and in-memory OLTP (premium tier feature only). The guaranteed DTU resources, features, and limits per service tier and performance level.
You can build your first app on a small database for a few bucks a month, then change the service tier and performance level manually or programmatically at any time as your app requires resources, with minimal downtime to your app or your customers. You are billed at an hourly fixed rate for outgoing Internet traffic only (not by query) based on the service tier and performance level you choose. The first 5 GB of network traffic per month is free.
Azure SQL Database V12 is based on SQL Server 2016, delivering close compatibility with SQL Server 2016. There is a limited set of features in SQL Server 2016 (and in earlier versions) that are not yet supported in Azure SQL Database. This set of features is shrinking. At the same time, Microsoft has adopted a cloud-first approach to new features in SQL Server—delivering many new features first in Azure SQL Database (in both private and public preview mode) before releasing them to SQL Server 2016 (and to rolling upgrades to SQL Server 2016 that will be coming).
Microsoft combines the power of machine learning and automation with Azure SQL Database to deliver a number of features that are available only in Azure SQL Database. These include:
Built-in backup: Reduces administration costs when there are large numbers of databases and supports point in time restore, geo-restore, standard geo-replication, and active geo-replication
Auditing and threat detection: Tracks database events to maintain regulatory compliance, understand database activity, and gain insight into discrepancies and anomalies that could indicate business concerns or security violations
Index advisor: Recommends and/or automatically adds indexes based on actual query performance and removes added indexes that provide no value
Query performance insight: Provides insight into resource usage by top CPU consuming queries and the ability to drill down into query details of problematic queries
Elastic database pools: Enables you to pay for a pool of resources and share them across databases to efficiently spend more for resources as needed
Furthermore, you can manage many aspects of Azure SQL Database, including monitoring its health, directly through the Azure portal dashboard. The following figure shows an Azure SQL Database in the Azure portal.
Source of Information : Migrating SQL Server Databases to Azure