vSphere 5 includes the following improvements and new features (compared to vSphere 4.1):
- Improved VM scalability (up to 32 vCPUs and 1 TB RAM) and performance (3x to 4x I/O improvements)
- New and improved HA architecture (easier to set up and more scalable)
- Autodeploy: On-the-fly deployment of ESXi hosts through PXE-boot
- Profile driven storage: allows to define classes of storage (distinguished e.g. by performance and availability) and tie VMs to it by defining "storage policies"
- Storage DRS: Automatic initial storage placement and balancing of VMs
- vSphere 5 hosts are ESXi only. No more classic ESX (like previously announced)
- Change in licensing model: vSphere 5 will still be licensed per physical CPU socket, but introduces another component: vRAM, which is the amount of RAM configured for VMs. Each CPU license entitles for the use of a specific amount of vRAM (dependent on the vSphere edition, e.g. 48 GB for Enterprise Plus). vRAM entitlements can be pooled among all hosts managed by a vCenter instance. For details see the new Licensing Whitepaper.
vCenter Site Recovery Manager (SRM) 5 introduces "vSphere Replication" a.k.a. host-based mirroring and a new "automatic failback" feature. For details see VMware's official product page.
The new vSphere Storage Appliance turns the local hard disks in your ESXi hosts into mirrored, highly available NFS datastores. This way you can use VMotion, DRS and HA without the need for additional shared storage hardware. See the product overview and the technical whitepaper.
vShield 5 introduces new sensitive data discovery and intrusion detection capabilities.
vCloud Director 1.5 now supports fast provisioning with linked clones (a feature that was already available with the Lab Manager product that is now obsoleted by vCloud Director) and supports SQL as its database.