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I have been ask this question I would like to have a quality response. Please keep in mind the person asking the question is a database admin not a VMware expert. I have in mind what to say just need a good way to explain to him the way VMware works.
Host is
Dual X5650  2.67GHz HP DL380 72GB of RAM

The SQL server has 4 vCPU but is only using at the most about 1800 MHz. I think the disks would be more of an issue. Raid 5 SAS drive all local storage.

I have a question on how our ESX server platform works.
 
for example if we have a host that has 2 procs and each proc has 4 cores
and we create a single VM on that box and set that vm up so it has 1 cpu... will that CPU then consume or use 1 core of 1 proc?
 
The reason I am asking is I am doing some calculations on if we are really saving money if we move our sql server to 2 procs on a VM or if it would be cheaper to move it to a physical single proc 4 core machine.  SQL license would be the same price but we would have 4 times the power.
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RickEpnetAsked:
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Andrew Hancock (VMware vExpert / EE MVE^2)VMware and Virtualization ConsultantCommented:
Depending upon how busy the SQL server is, RAID10 write performance is better than RAID5, also more disks, more spindles, more throughput and more IOPS for your database.

Adding many vCPUs to your virtual can slow it down because of the vSMP scheduler.

Its often better to start with 1, and increase to obtain the performance you require, and then only certain applications can use multiple cpus, or take advantage of multiple cpus.

SQL is one of these applications.

With your dual processor, quad core server, you will have a total of 8 cores that can be allocated to the VM as 1 vCPU.

1 vCPU is equal to 1 core on the physical host, or can be, it could be the same core for the duration of the VM process, or it could be shifted depending upon loading on the host, this is performed by the hypervisor.
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Andrew Hancock (VMware vExpert / EE MVE^2)VMware and Virtualization ConsultantCommented:
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Andrew Hancock (VMware vExpert / EE MVE^2)VMware and Virtualization ConsultantCommented:
This was the official Microsoft SQL License pdf, I was looking for...

http://download.microsoft.com/download/2/7/0/270B6380-8B38-4268-8AD0-F480A139AB19/SQL2008R2_LicensingQuickReference-updated.pdf

If you are looking for a price versus performance, the physical server will win, the physical server will have no hypervisor ovearhead. But it does depend on the SQL database, we have had to complete a few V2P of SQL virtual machines because performance suffered in a virtual environment.
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RickEpnetAuthor Commented:
But the server is not even using 100% of even one CPU it would be best to reduce the vCPU to 2 right?

I think I understand this could you explain how this works a little more.
With your dual processor, quad core server, you will have a total of 8 cores that can be allocated to the VM as 1 vCPU.
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Andrew Hancock (VMware vExpert / EE MVE^2)VMware and Virtualization ConsultantCommented:
I would start with 1vCPU and if performance is poor, add another.
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RickEpnetAuthor Commented:
I think I understand this could you explain how this works a little more.
With your dual processor, quad core server, you will have a total of 8 cores that can be allocated to the VM as 1 vCPU.
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Andrew Hancock (VMware vExpert / EE MVE^2)VMware and Virtualization ConsultantCommented:
Correct, or in theory add 8vCPU = 8 Cores!
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Andrew Hancock (VMware vExpert / EE MVE^2)VMware and Virtualization ConsultantCommented:
Official VMware Design specifications in the past quoted

3 to 5 1 vCPU VMs per core on a Dual Core Host CPU
6 to 8 1 vCPU VMs per core on a Quad Core Host CPU

Checkout the following VMware documents, Chapter 2, CPU will answer your questions further.

Resource Managment Guide:

CPU Scheduler whitepaper:

Any further queries about the documents, or further questions, please ask.
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Andrew Hancock (VMware vExpert / EE MVE^2)VMware and Virtualization ConsultantCommented:
I got the Resource Management Guide Link incorrect.
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