Windows Azure is a cloud based operating system which act as a service provider for cloud platform based application .It provides a cloud based fabric which hosted on Microsoft data center for managing, deploying and distributing application and service .Windows Azure has two main areas of functionality computing and storage.
Cloud service consumer host application on Windows Azure and it provide a highly scalable environment for executing application.
Windows Azure provides fundamental services for BLOB storage, queue storage, and simple table storage. But the storage service is not relational for relational database service; SQL Azure will be the choice
o   Model: Treat the data center as a machine
o   Handles resource management, provisioning, and monitoring
o   Manages application lifecycle
o   Allows developers to concentrate on business logic
•         Provides shared pool of compute, disk and network
o   Virtualized storage, compute and network
o   Illusion of boundless resources
•         Provides common building blocks for distributed applications
o   Reliable queuing, simple structured storage, SQL storage
o   Application services like access control and connectivity
Windows Azure Components
    
Windows Azure PaaS
Applications
Windows Azure Service Model
Runtimes
.NET 3.5/4, ASP .NET, PHP
Operating System
Windows Server 2008/R2-Compatible OS
Virtualization
Windows Azure Hypervisor
Server
Microsoft Blades
Database
SQL Azure
Storage
Windows Azure Storage (Blob, Queue, Table)
Networking
Windows Azure-Configured Networking