Storage protocols for ESXi
Direct-attached storage is sometimes used for the ESXi installation. It can also be used in smaller environments that don’t require shared SAN storage. Noncritical data is sometimes stored on direct-attached storage, for example CD-ROM ISO images, VM templates, decommissioned VMs, etc.
Shared storage enables you to use some advanced vSphere features such as vMotion, High Availability and Distributed Resource Scheduler. It can also be used as a central repositoriy for VM files and templates, clustering of VMs across ESXi host and allocation of large amounts of storage to the ESXi hosts.
The following table shows which vSphere features are supported by different storage protocols (source: VMware):