MS Azure : What is Database Transaction Units (DTUs) ?

Database Transaction Units (DTUs)

A DTU is a unit of measure of the resources that are guaranteed to be available to an Azure SQL database at a specific performance level.

DTU is measures how powerful is your database is, but how it measures ?
DTU is measured based upon the resource utilization by the database:
Blends CPU + Memory + Data I/O + Log I/O
It is based on a Microsoft OLTP benchmark. It is useful unit of comparison.

So basically in short, Higher DTUs provide higher throughput.

Changing Tiers :

You can move/change database from a lower tier to a higher tier or vice versa at any point in time.
There are few point which we have to keep in mind before changing the tier:
1. Duration of the change depends on the amount of data.
2. Your charges will change once the new tier is in effect.
3. You need to retry logic in your application according to DTUs usage (Resources utilization - CPU / Memory / Data & Log I/O).

For Example :

If we execute 10 Queries on both Tiers, result would be like as follows:
In Basic Tier a Database with 5 DTUs limit will complete 10 queries execution in 60 Seconds.
In Standard Tier a same Database with 100 DTUs limit will complete 10 queries execution in 3 Seconds.

Click here for the demo of changing tiers example in further posts.