Virtualized SQL Server: Why not?

Question

The IT department where I work is trying to move to 100% virtualized servers, with all the data stored on a SAN. They haven't done it yet, but the plan eventually calls for moving the existing physical SQL Server machines to virtual servers as well.

A few months ago I attended the Heroes Happen Here launch event, and in one of the SQL Server sessions the speaker mentioned in passing that this is not a good idea for production systems.

So I'm looking for a few things:

1. What are the specific reasons why this is or is not a good idea? I need references, or don't bother responding. I could come up with a vague "I/O bound" response on my own via google.
2. The HHH speaker recollection alone probably won't convince our IT department to change their minds. Can anyone point me directly to something more authoritative? And by "directly", I mean something more specific than just a vague Books OnLine comment. Please narrow it down a little.

Answer 1

We are running a payroll system for 900+ people on VMWare with no problems. This has been in production for 10 months. It's a medium sized load as far as DB goes, and we pre-allocated drive space in VM to prevent IO issues. You have to defrag both the VM Host and the VM slice on a regular basis in order to maintain acceptable performance.

Answer 2

SAN - of course, and clustering, but regarding Virtualization - you will take a Performance Hit (may or may not be worth it to you):

http://blogs.technet.com/andrew/archive/2008/05/07/virtualized-sql-server.aspx

http://sswug.org has had some notes about it in their daily newsletter lately