I have been asked this question by a friend, but I didn't feel I could give a satisfactory answer. Maybe somene here at BioStar can share some experience.
The question is: what kind of hardware would you need to offer a BLAST service for about 50 different users, with an expected average of 5-10 concurrent requests, which might be higher at peak times. A wide range of different databases should be offered, ranging from single bacterial genomes to NCBI-style 'nr' databases.
My initial answer was that the number of concurrent BLAST runs should be kept to a minimum by using a queuing system (similar to what is done at NCBI, EBI and the other big centers). The main problem in this particular setting is that the majority of BLAST searches are not via a fancy Web interface but rather command-line requests, generating tabular or XML output.
Maybe I should ask two questions: 1) what kind of hardware would you need (# of CPUs, how much RAM, RAID?), and 2) has someone experience with a queuing system for command-line blast?