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IIS Response Delays on VMware

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We have a customer who's moving our asp.net application from a pair of physical Server 2008 servers to a virtual environment.  The virtual environment is provided by some 3rd party cloud provider...  Our only understanding of the virtual environment is that it's VMware.  Product, version, etc. unknown...

When one of the servers goes from a relatively quiescant state to a suddenly busy one we notice an increase in IIS' response times.  Response times go from 10s of msecs to several seconds and this condition lasts for several seconds.  Unfortunately, these delays are critical to the application...

It's been suggested that IIS needs more memory and that the virtual environment is slow in providing that memory, thus affecting performance.

Two questions...

1) Does this sound right?

2) If so, is it typical?  Any practical strategies to overcome it?

Curt


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