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I would like to install SQLExpress2005 as an instance ‘SQLExpress’ and install SQLExpresss2008 as ‘SQLExpress2008’ instance.
Is there any problem with doing this on the same machine?
As Long as you give them distinct names, there shouldn’t be any problems. The binaries are stored in directories based on version, and you can (and should) point their filegroups at different locations. This should also apply to the Full versions.