[diafygi]

AZ's are different data centers, but in the same region. I think that means that the buildings are close enough to have super low latency connections to each other. However, when a huge storm rolls through, it can wipe out all the AZs (which is basically what happened). AZs are mostly for guarding against floods, fires, and other localized disasters, not regional disasters that leave 2 million people without power.

[robryan]

As I understand it the separate AZs can be the same data center but in theory they are completely separated from each other in terms of network/power etc so an outage in one shouldn't effect the others.

[count]

The other catch that not many folks seem to realize is that 'your' us-east-1a is NOT the same as 'my' us-east-1a, although my 1a and 1b are guaranteed to be different AZs.

And I think you hit the nail on the head - 'regions' are for regional fault tolerance, while AZs are for within-a-region fault tolerance.