Server consolidation and performance isolation a dead issue?

Back when virtualization was transitioning from being a curiosity to a buzzword, one of the core issues addressed in whitepapers and other research involved performance isolation. In a nutshell, performance isolation issues arise when you have different types of workloads, each of which would normally be run on an independent server, all running under VMs on the same processor—and each unaware of the others' presence.

This isn't discussed now as much as it used to be; some Googling turns up a few good papers on it, but they're from 2007. To see if that was true, I started a discussion thread in The Server Room, asking our IT pros if this had come up as an issue for them recently, and I got all of three responses. This admittedly unscientific investigation supports a hypothesis that I have about how the virtualization story has evolved over the course of the past few years.

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