We recently built a dedicated SQL server for a project at work. Nothing massivly huge just a Dell 2850 with dual 3.0Ghz CPUs, and 4GB of ram. However I started to think about the benefits to having a dedicated machine running your SQL databases.
Most companies like us probably end up have numerous applications that require an SQL database. Most of these install SQL Express for this. So you end up with multiple application servers all running their own instance of SQL Express. This is a huge waste of system resources. The memory, and processing power required to run SQL could be saved by running a dedicated SQL box.
We have started taking this approach, and have reduced the memory requirement of many of our application servers by moving all the databases to our dedicated SQL server.
Our applications perform better because the database is much faster. It has more memory cpu, and disk io avaliable than before. The application servers are only running the application so that makes it even faster.
Now the problems you have is that when you need to take down your SQL server all your applications come down too. We are resolving this by using database mirroring.
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