Earlier quoted context omitted.
Are people running multiple untrusted VMs without turning SMT off? Even letting them share caches seems like asking for trouble.
Not only do people do this, it's generally how VPS providers work. Most machines barely use the CPU most of the time (web servers etc.) so reserving a full CPU core for a VPS is horribly inefficient. It doesn't matter anyway, because SMT isn't relevant for this particular bug. With SMT allowing twice the cores on a CPU for most workloads, disabling it would double the cost for most providers! There are VPS providers…
Providers usually won't disable SMT completely, they'd run a scheduler which only allows 1 VM to use both SMT threads of a core. Ultra cheap VPS providers may still find that not worth the pennies though as if you sell a majority of single core VPS then the majority of your SMT threads are still unavailable even with the scheduler approach.
Fully dedicated cores aren't necessarily required because in the timesliced case the registers are unloaded and reloaded when different VMs are shuffled on and off the core. That said, they definitely prevent the cross-vm-data-leak case of this bug.