Availability Set vs Zone

Availability Set (SLA 99.95%) same datacenter

Logical grouping of virtual machines that helps to keep the application hosted during planned or unplanned maintenance.

Availability Zone (SLA 99.99) data centre in separate physical locations
Azure avalability zones are physically separate locations within Azure region that are tolerant to local failures.

SLA meaning
                  Downtime per week    Downtime per month
99.9           10 min                        43.2 min
99.95         5  min                         21.6 min
99.99         1 min                          4.32 min

Availability Set: consist of Fault Domain and Update domain

Fault domain means racks

Update domain means servers

In availability set method virtual machines are distributed among different racks and servers but within same data centre.

Suppose we have 3 fault domain and 20 update domain

it means we have 3 racks and 20 servers.

We can distribute our virtual machines on 3 racks and among 20 servers.
in case 1 rack goes down other 2 racks will provide backup.

But if whole data centre failed due to any flood/earthquake we don’t have any backup option in this situation concept of Availability zone comes into picture.

Availability Zone:

means suppose in South India location we have 3 zones which are distant of kilometres from each other.

such as Mumbai, Ahmedabad , Bangalore
Suppose Mumbai data centre failed then we still have 2 zones as backup.