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Traditional network isolation techniques such as IEEE 802.1Q VLAN provide 4096 LAN segments (via a 12-bit VLAN identifier) and may not provide enough segments for large cloud deployments. Cisco and a group of industry vendors are working together to address new requirements of scalable LAN segmentation as well as transporting virtual machines across a broader diameter.
The underlying technology, referred to as Virtual Extensible LAN (or VXLAN), defines a 24-bit LAN segment identifier to provide segmentation at cloud scale. In addition, VXLAN provides an architecture for customers to grow their cloud deployments with repeatable pods in different subnets. VXLAN can also enable virtual machines to be migrated between servers in different subnets.
VXLAN solves these challenges with a MAC in User Datagram Protocol (MAC-in-UDP) encapsulation technique. VXLAN uses a 24-bit segment identifier to scale. In addition, the UDP encapsulation enables the logical network to be extended to different subnets and helps ensure high utilization of port channel links. Instead of broadcasting a frame as in a case of unknown unicast, the UDP packet is multicasted to the set of ervers that have virtual machines on the same segment. Within each segment, traditional switching takes place and can therefore provide a much larger number of logical networks.
download the whitepaper: white_paper_VXLAN