Re: VM Host Hardware Recommendations.

First and foremost you need a CPU with hardware virtualization
extensions. I am taking this for granted because it's hard to find a
server class CPU w/o this.

As Brad pointed out, it's hard to give specific advice until you know
the I/O vs CPU vs memory load.  However, I can give you some general
advice.

There are three things I look for when building hosts for virtualization:

- cache

Having a large CPU cache means that context switches (in this case
from one VM to another) are not as costly.  It also reduces the
contention on the memory bus, which is a shared between multiple VMs.

- RAM

Naturally more RAM allows you run more VMs... but more importantly
having lots of RAM prevents the need to go to disk to get data as it
can be cached.  Having free RAM around can improve certain kind of
disk I/O loads.  This is true on non-virtualized systems as well.

- cores

If you have a lot of active VMs, the system will spend a lot of time
ushering VMs in and out of the CPU.  This wastes time, and having more
cores helps.  Be careful here... adding cores without adding to the
CPU cache can make things worse.

After these, thing get expensive.  You can pin dedicated network cards
to each VM to improve network I/O.  You can also improve your storage
I/O bandwidth by using a SAN.

-Bart
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