What extra one gets by selecting Azure SQL Managed Instance vis-a-vis Azure SQL DB PaaS

With Azure SQL Managed Instance, you essentially get a full fledged SQL Server that you can control any way you want, just like you would control a locally configured SQL Server. All the power and access and customization you want.

With, Azure SQL DB PaaS, you are essentially getting a database service, so, you give up a lot of control.

For example, take server collation. With the database service, SQL_Latin1_General_CP1_CI_AS , is all you get. With the Managed Instance, its your server. So, go ahead and select whatever collation you want, just like how you would select the collation at the time of creatoin.

Another issue is with auditing, if that is something that is important to your setup. with SQL Managed Instance, auditing happens at server level, because, you are getting the full database server. With the database service, it only database, because, you are only getting a database.

These are just the main details that I found. more details here at this Azure doc - https://docs.microsoft.com/en-us/azure/azure-sql/database/features-comparison

Of course, Managed is going to cost you more because you are paying for the license of the SQL server too.

Lastly, for me, this is the almost (not the exact same thing) like you running your own File Server on a Windows VM on Azure (Managed Instance) versus, just using Blob Storage. In both cases, you are just trying to store some files, but its how much control you have.

I would say think about Azure SQL DB vs Azure SQL Managed Instance (MI) as

Azure SQL DB = Resources dedicated to individual DBs like a container. They are grouped under a Azure SQL Server but that SQL Server is just for grouping.

Azure SQL MI = Almost same as on-prem SQL Server except you don't have to worry about OS, backups, high availability.

Here is a good comparison. https://docs.microsoft.com/en-us/azure/azure-sql/database/features-comparison

Hopefully this will help