I never got server lag when on 1.7.3, but that all changed when 1.8.1 came out...
So I stopped the 1.7.3 server and started a 1.8.1 server but something was different there was high network usage and some what low FPS(since fps is not server side I won't go into detail) I stopped the minecraft server and opend task manager and went to the network tab the usage was about 0.1% so I checked off DOS(Denial Of Service) then I started the server back up and people joined not all at once but maybe about 2 every 5 seconds until we got up to 27 people online then I looked at the task manager network usage and it was around 3% and in game was about 4-5TPS(Ticks Per Second) I knew this wasn't good and nothing had changed hardware wise only thing I changed was bukkit from 1060 for 1.7.3 to bukkit 1185. I then disabled all my worlds and started a new one then people rejoined and we had about 24 people with 4TPS So I am checking console and I disable plugins that arn't nesecary and causing console errors then I reboot the server still the same thing happens, I don't know what to do I am tech geek but this is beyond me and I feel that its minecraft itself.
System specs: Host: Server4you.com OS: Windows Server 2008 SP1 Connection: 100mbit branched from a 150gbit fiberoptic line HardDrive(s): 2 1TB SATA II HardDrives 1st one is for OS and the second is for backups, I run the actual server on a RamDisk RAM: 12GB DDR3 5GB for the server and 3 for the RamDisk Processor: AMD Athlon II x4 Access: Remoted Desktop Connection
P.S. I thought it might be a bad plugin but it still lags on 1.8.1 vanilla. I also thought people with the 1.8 prerelease might be causing lag with mismatched version of minecraft because I kept getting socket errors when some people joined and left, But now I am testing 1.9 prerelease and I get some block lag and network usage at 1% when I have about 11 people on :?/