What are the pros and cons of installing multiple instances of SQL Server 2005 on a machine in order to monitor multiple projects vs. installing multiple databases within the same instance?
I've done both in different projects. Resource-wise, I haven't really seen big differences. With multiple instances, you do have a bunch of things duplicated but it's not that serious. It also depends on the level of activity. If they're both likely to be active, you'll do better with a single instance as you get a shared lot of memory for proc cache, etc. But two instances of SQL Server do seem to share memory pretty well. The issue is often more to do with whether the two instances have the same admin relationships. Are they the same administrators?
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