Enterprises Dilemma: Choosing

L2VPN or L3VPN
PNLRST-4002

Moderator Raiiv Asati

Distinguished Engineer, Cisco

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 Orders that were supposed to be processed in 3

milliseconds were taking 5 milliseconds, said one
person familiar with exchange operations. This
proved to be a major problem: In the extra two
milliseconds new orders flooded in, thwarting the
system's ability to establish an opening price for
the stock and leading to a backup in unprocessed
orders.

Minute by minute, Nasdaq chaos engulfed Facebook IPO

Reuters
5/26/2012

L2VPN Models
L2VPN Models

Local Switching

MPLS Core

IP Core
CE-TDM

VPWS

VPLS / VPMS

AToM

L2TPv3
P2MP/
MP2MP

Point-to-Point

FR

ATM
AAL5/Cell

Ethernet

Ethernet

FR

Ethernet

PPP/HDLC
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Any-to-Any Service
Point-to-Point

T1/E1

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ATM
AAL5/Cell

PPP/
HDLC

VPN
Site

L2VPN - What is it?

CE4
PE4

Enterprise sites get Layer 2 connectivity via SP

network
SP network uses IP/MPLS L2VPN technology
Pseudowire (RFC3985), EoMPLS (RFC4448)

VPN
Site
CE1

PE1

SP
MPLS
Network

PE2

CE2

VPN
Site

PE3
CE3

Physical
Connectivity

VPN
Site

1 PE-CE interface for Any-to-Any connectivity

VPN
Site

Assumes Multipoint L2VPN (e.g. VPLS, E-LAN)

N-1 PE-CE interfaces per site for Any-to-Any

Assumes P2P L2VPN (e.g. VPWS, E-TREE)

1 PE-CE interface per site for 1 remote site

VPN
Site
CE1

Assumes P2P L2VPN

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CE4

IP Routing
Neighbors

PE1

Layer 2
Cloud

PE2

CE2

VPN
Site

PE3

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Logical
Connectivity
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CE3
VPN
Site

VPN
Site

L2VPN - What is it?

CE4
PE4

SP network becomes a Layer 2 Cloud

VPN
Site
CE1

PE1

SP
MPLS
Network

PE2

CE2

VPN
Site

Acts as Switch for Multipoint L2VPN Sites

Acts as a simple passthrough for P2P L2VPN Sites

SP network may participate in Spanning-tree in

case of Multi-point L2VPN

PE3
CE3

Physical
Connectivity

VPN
Site

VPN
Site

Full-mesh of IP routing neighbor relationship

CE4

IP Routing
Neighbors

VPN
Site
CE1

PE1

PE4

Layer 2
Cloud

PE2

CE2

VPN
Site

PE3

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Logical
Connectivity
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CE3
VPN
Site

VPN
Site

L3VPN - What is it?

CE4
PE4

Enterprise sites get Layer 3/IP connectivity via

SP network
SP network uses MPLS IP/VPN (RFC4364)
Any-to-Any site IP connectivity over a single PECE interface

VPN
Site
CE1

PE1

SP
MPLS
Network

PE2

CE2

VPN
Site

PE3
CE3

Physical
Connectivity

VPN
Site

VPN
Site

VPN Sites exchange IP routes via the SP

CE4

IP Routing
Neighbors

VPN
Site
CE1

PE1

PE4

Layer 3
Cloud

PE2

CE2

VPN
Site

PE3

Logical
Connectivity
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CE3
VPN
Site

L3VPN
Enterprise View
Advantages

Disadvantages

Last-Mile Media Independency

IP Routing Shared with SP

Fixed number of IP routing adjacencies

SP must implement Multicast, IPv6 etc.,

if Enterprise wants them site-to-site

Independent of no. of sites

IP QoS

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L32VPN
Enterprise View
Advantages

Disadvantages

Separate Administrative Boundaries

Last-Mile Media Dependency*

Any routing protocol (e.g. EIGRP)

Large Layer 2 Domains (e.g. STP)

Routing table Not shared with SP

or

No SP dependency if IPv6, Multicast

etc. are enabled in the enterprise

Large IP routing adjacencies

No SP dependency if MPLS to be
enabled in the enterprise

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Depending on number of sites

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L3VPN

vs. L2VPN

Source Vertical Systems Group - ENS

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Take-Away
Both L2VPN and L3VPN are valid choices for enterprises
L2VPN or L3VPN decision depends on many factors

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Panelists
Jim Rampley
Principal Engineer, Charter Communications

Christopher Painter
Sr. Solutions Architect, Verizon

Alexei Sadovnikov,
Principal Technical Network Architect, IBM Enterprise Network @
AT&T GMS

Mike Anderson
Manager, Cisco IT

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Jim Rampley
Principal Engineer, Charter Communications

Services Portfolio L2VPN, L3VPN

Charter offers both L2VPN (Carrier Ethernet) & L3VPN (IP VPN/MPLS)

L2VPN (Carrier Ethernet) Service Type Offerings ( Various services

offerings within each service type, both Port-Based and VLAN-Based)
Service Type
E-Line (EPL, EVPL)
E-LAN (EPLAN/EVPLAN)
E-Tree

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What our Customers Want in a VPN!

Simple transparent service, no restrictions on type of traffic types, ex.
Multicast

Full control of IGP

MEF based Ethernet design and handoff
EPL, EVPL, EPLAN/EVPLAN, typically not interested in E-Tree

802.1q tagged & untagged handoffs (VLAN and port based)

Complete flexibility on speed offerings with scalability and quick upgrades
QoS

Stringent SLA's
Cost effective
Long-haul services (not just metro)
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L2VPN Customer Considerations

Customers often do not have the expertise to manage a layer 3 WAN

Customer that do, desire full control/transparency from their provider

Additional equipment usually not required, abundance of cost effective L2
& L3 Ethernet ports
Customers need to understand the ramifications of extending L2 across a
large WAN, could contradict the benefits of Carrier Ethernet if poorly
utilized
Size of broadcast domain

Provider MAC address restrictions

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L3VPN Customer Considerations

CAPEX to install a router with BGP capabilities at each location
Or extra cost of a completely managed L3VPN solution.
Loss of routing control
More time spent managing the vendor instead of managing your network

Complexity of redundancy and carrier diversity

Convergence times of L3VPN, faster convergence might require PfR for

voice, video, and critical data services.
Complexity of PfR or another path manipulation tool layered on top

Number of routes provider will accept

Does the provider offer IPv6?
Does the provider offer multicast (mVPN) or will I have to build GRE
overlay?
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Provider Considerations for VPN

Carriers have to engineer their networks more stringently for self
preservation
Carriers fat dumb pipes are more complex to operate and support
behind the scenes
Carriers have to adapt to the ever changing whims of the marketplace
(e.g. bandwidth, SLAs, protocols)
MAC address limits/route limits

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L2VPN Deployment Strategies Customer

Deployment Considerations
Critical discussion in the Sales Engineering design phase:
Customer chooses NOT to route between remote sites
Single broadcast domain (careful with allowing it to grow to large)
No layer 3 routing
Simple IP addressing

Minimal customer CAPEX

Not as scalable / MAC learning concerns

Customer chooses TO route between sites

Limits broadcast domains
Customer runs its own routing protocol over EVCs
Very Scalable

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L3VPN Deployment Strategies -Customer

Deployment Considerations
Mature technology from an industry perspective

Layer 3 Routing
May require major changes to customers routing infrastructure
Provider plays key role of the customers routing architecture
Customer installs router at each handoff point
Customer typically advertises routes with BGP from each site
Provider could use static routes pointing at each site (Clunky for large
deployments)

Limits broadcast domains

Scalability is built into the solution by design from a provider and customer
perspective
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Case Study Four Site High Speed L2VPN

Customer requirement:
4 sites in a bi-state region requiring high bandwidth low latency GigE
handoff with full site connectivity
Solution:
Customer chooses a L2VPN EVLAN service

Customer keeps CAPEX low by using existing layer 2/3 switches at each
site which will accept provider handoff
Provider deploys VPLS for any to any connectivity.

Customer deploys layer 3 routing at each site using SVI's on switches

No dedicated routers required
Provider is transparent, customer is in full control of layer 3 routing
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Case Study Four Site High Speed L2VPN

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Chris Painter
Sr. Solutions Architect, Verizon

Verizon Layer 2 / Layer 3 VPN Portfolio

Layer 3 MPLS
VPNs

Layer 2 Ethernet Layer 2 Ethernet

Virtual Private
Virtual Private
LAN Service
Line Service
(VPLS)
(EVPL)

Layer 2 TDM
MPLS VPNs

Topology
Options

Any-To-Any / Hub
and Spoke

Any-To-Any / Hub
and Spoke

Point-To-Multipoint /
Partial Mesh

Point-To-Multipoint /
Partial Mesh

Enterprise
Circuit Types

Various Access
Methods
(TDM, Ethernet,
Wireless, VSAT, etc.)

Ethernet

Ethernet

TDM Encapsulations
(i.e. Frame Relay)

QoS

Multiple IP CoS

Multiple Ethernet
CoS

Multiple Ethernet
CoS

Single CoS

Protocols
Supported

IP

IP and Non-IP
(Customer Defined)

IP and Non-IP
(Customer Defined)

IP and Non-IP
(Customer Defined)

Security

MPLS Private
Network

MPLS Private
Network

MPLS Private
Network

MPLS Private
Network

Scalability

Large Networks

Regional or Core
Networks

Regional Core
Networks

Large Hub and

Spoke Networks

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Customer WAN MPLS Layer 2 / Layer 3 VPN

Distribution
6%

2%

2%

Layer 3 MPLS VPNs

Layer 2 TDM Point-toMultipoint
Layer 2 Ethernet Point-toMultipoint
Layer 2 Any-to-Any
Ethernet

Note:
Percentages do not account
for access technologies
utilized.
Percentages do not account
for Legacy Frame Relay / ATM
networks.
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90%
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Enterprise Drivers for Choosing Layer 3 or Layer 2

VPN Solutions
Supports technologies (i.e., multicasting, VoIP, e-learning, e-everything)

Move to network-based applications (i.e. Cloud Computing)

Network Scalability, Geographic Reach and Bandwidth Requirements per
Site
Connectivity Options/Flexibility: Terrestrial, Wireless, VSAT, Etc.
QoS Requirements
Reduced network administrative burden
Investment protection for future topology/technology adaptation
Economics of the solution

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Customer Design Questions for Choosing Layer 3

or Layer 2 VPN Solutions
IP Routing Requirements?
Any-to-Any or Hub and Spoke routing based on applications?
Layer 3 VPNs rely on BGP and Static Routing

Connectivity Requirements based on location, economics and bandwidth?

Ethernet Only or Various Access Methods Required (Ethernet, TDM, Wireless, etc.)

Network Based Solutions and Business Partner Connectivity Requirements?

VoIP, Cloud Computing, Extranet Architecture Solutions

Alternative Design Option : Core Layer 2 VPN / WAN Layer 3 VPN Solutions
Optional Layer 3 VPN with GRE Tunnels for Customer controlled topologies
Multi-Service Access Solutions with Layer 2 and Layer 3 VPNs sharing common physical
access
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Common Large Enterprise Layer 2 / Layer 3 VPN Topology

EPL = Ethernet Private Line
VPLS = Virtual Private LAN Service

Core Layer :
Data Centers Regional Hubs

EVPL = Ethernet Virtual Private Line

Layer 1 or 2
Private Line / EPL / VPLS / EVPL
IGP EIGRP or
OSPF

Layer 3 MPLS VPNs

EBGP and
Static*

* Optional OSPF
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WAN Aggregation Layer Remote Sites Stores and Branches

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Use Case : Enterprise Layer 3 VPN Solution

Major Retailer
Requirement: Provide Secure Primary and Back-Up Connectivity to the Retail Stores and Distributed Data Centers along
with Network Based VoIP
Verizon Solution
+ Layer 3 MPLS Private Network provides primary Ethernet and TDM
connectivity and failover paths using a combination of private VSAT and private
wireless access data networks.
+ This solution provides QoS for VoIP and any-to-any routing for the distributed
Data Center application reach.
+ Network Based solutions and Business Partner connectivity solutions are
possible for future network designs.

Layer 3 MPLS
VPNs

Customer Benefits
+ The Private Network solution provides a secure communication
path for information flowing between the store and the corporate
network.
+ Economic and flexible back-up solutions.
+ Scalability and Topology Flexibility : i.e., VSAT Backup utilized for downstream
Multicasting
28

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VoIP
Network

Extranet
VPN

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Use Case : Enterprise Layer 2 VPN Solution

Global Manufacturing Company
Requirement: Provide Secure High Bandwidth Connectivity between Geographically Disperse
Data Centers with Custom IP Routing Requirements and future planned topology changes.
Verizon Solution
+ Layer 2 VPLS Virtual Private LAN Service to provide High Bandwidth
Ethernet Any-to-Any connectivity between the multiple Enterprise Data
Centers.
+ Customer controls their Data Center IP Routing design
+ Layer 2 CoS and Any-to-Any Ethernet connectivity
VPLS
Network

+ Flexibility for future planned topology changes.

Customer Benefits
+ The Private Network solution provides a high bandwidth secure
communication path for information flowing between the Data Centers.
+ Customer has IP routing design autonomy and flexibility.
+ Scalability and Topology Flexibility

29

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Use Case : GRE within a Layer 3 VPN Solution

Major Financial Service Provider
Requirement: Provide Secure Hub and Spoke Data Application Connectivity and support the rollout of an Any-to-Any
Network Based VoIP Solution : Customer was looking at Layer 2 VPNs.
Verizon Solution

Customer
Data Center

+ Layer 3 MPLS Service with a Customer Edge Router to Customer Edge

Router DMVPN GRE Tunnelling overlay for the Data Applications.

GRE
Tunnel

+ Customer controls their Hub and Spoke Data Application routing design
+ VoIP runs within the Layer 3 MPLS VPN Global Routing tables.
+ Network is flexible for future Any-to-Any Data topology changes.
Customer Benefits

+ The Private Network solution provides a high bandwidth secure

communication path for both Data and VoIP Applications.

Any-to-Any
MPLS VPN

+ Customer has IP routing design autonomy and flexibility for the Data
Applications. Freedom to maintain OSPF or EIGRP routing.
+ GET VPN is a future alternative to the DMVPN GRE Tunnelling.

30

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Remote
Site

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Remote
Site

Summary
Every Customer Design has its own unique requirements
Global Reach / Security / Applications/QoS Required
Layer 3 VPNs meet the vast majority of these requirements

VPN Designs need to be flexible for future topology changes

Cloud Based Solutions : VoIP / Video / Cloud Computing
Flexibility for Mergers and Acquisitions / Divestitures

Verizon Enterprise Solution Resources

Verizon Layer 3 Private IP MPLS VPN : http://www.verizonbusiness.com/Medium/products/networking/privateip/
Layer 2 VPLS : http://www.verizonbusiness.com/Products/networking/private/vpls/
Layer 2 EPL: http://www.verizonbusiness.com/us/Products/networking/private/ethernet/
Layer 2 Private IP: http://www.verizonbusiness.com/us/Products/networking/private/privateip/layer2.xml
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Alexei Sadovnikov,
Principal Technical Network Architect,
IBM Enterprise Network @ AT&T GMS

Choosing L2VPN or L3VPN

Factors influencing decision

Current state of the network

Network size and geographical location

Service availability
Routing and other technical
considerations
Context:
Following discussion is centered around
selection of wide area transport services
for the purposes of interconnecting
corporate offices of a customer network
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IBMs enterprise network

IBMs enterprise network
Spans the globe with around 800 sites
Over 500,000 LAN ports
About 30,000 routers and switches
About 300,000 VoIP phones

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Current state of the network

Many customers have migrated from pre-MPLS services, e.g. Frame
Relay or ATM to L3VPN
Migration from L3VPN to L2VPN services is rarely justifiable (or even
economically possible).
More realistic scenario for such customers is to use L2VPN services in addition to
existing L3VPN services.

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Network size and geographical location

L2VPN not available in all points of presence of large geographical
network
Access media is usually limited with L2VPN services, frequently to Ethernet
Type of CO equipment may limit L2VPN availability

It is easier for customer to scale up L3VPN services

L2VPN require enterprise to have routing coordination between all offices,
while in L3VPN each office simply needs to follow interface with service
provider

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Service availability
L3VPN were available for much longer time than L2VPN

Maturity of L3VPN service is one of the key factors which may influence Enterprise decision
Many enterprises made selection when L3VPN was the only offering
L3VPN services are easier to purchase in the market place
There is more expertise in the industry on L3VPN implementation

Availability of service features from service provider might impact Enterprise

decision
Transport features, i.e. advanced QoS model
Rich services from Service Provider -- Internet access, Voice Services, cloud computing, etc.

In cases when Enterprise needs services where primary service provider has no
presence, it is important if the primary service provider has NNI agreement with local
service provider
NNI agreements between service providers more common for L3VPN services

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Routing
L3VPN characteristics important Enterprise

It is service provider network which makes WAN routing decisions, not the
customer network
Routing is very simple in most common cases
Routing scales very well; any site to any site routing is naturally available
Service provider core IGP metric works well for multisource routes, i.e.
for default route
Customer sites are separated by service provider network, works well
when sites are under different administrative control

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Routing
L2VPN characteristics important for Enterprise

It is customer network which makes WAN routing decisions

Routing is very simple in most common cases for small networks

A lot of effort is required on customer side to make routing scale when
network is large
Service provider network IGP metric is not available for routing decisions

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Other technical considerations

L3VPN services challenges may drive enterprise to L2VPN
IPv6 and Multicast services availability changes provider to provider. IPv6 unicast routing will
be more available in short order.
Service provider has a copy of customers routing table can be a security concern
Multi-VPN is difficult to scale up (ordering, provisioning, etc.)
Some service providers limit number of routes from customers or charge extra when a threshold
is reached

L2VPN services challenges

There is a potential to use L2VPN services for non-router connectivity, for example VLAN
extension between two datacenters, but deployment especially to scale is challenging.
Other technologies, such as OTV may be a better answer.

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Other technical considerations (continued)

Routing with L3VPN becomes more difficult in advanced cases.
Level of complexity depends on requirements. In some cases L2VPN
could provide easier alternatives.
Non-MPLS backdoor between sites
Multiple service providers
Administrative selection of multisource routes
End-to-end BGP routing with crossover outside MPLS network (service provider
ASN repeats in AS path)

It is easier to migrate to L2VPN from pre-MPLS WAN services, for

example from Frame Relay, as long as no new features are desired
(specifically no requirement for any site to any site routing).
This is usually not an important consideration.

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Summary
Start selection process from the study of services availability
Can Enterprise offices be reached by L3VPN or L2VPN or both

Carefully review the requirements, map into PROs and CONs for L2VPN
and L3VPN approach
In certain scenarios L2VPN can augment L3VPN
Connectivity in densely populated metropolitan area

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Michael Anderson
Manager IT, Cisco

Cisco Presence
400 Branch locations in 90 countries

Office Types

500+ Individual buildings

Sales

51 datacenters and server rooms

Engineering

Over 1500 labs worldwide

120,000 users

Customer Advocacy
Corporate

Datacenter
Colocation

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Global Hybrid Multi-vendor WAN

Centralized
Many Vendors
Frame-relay Soln

Distributed Tiered
Distributed Tiered
Many vendors
Single Regional Vendor
Frame-relay Soln
TDM Soln

Single Regional
Vendor
L3 MPLS
Bedfont Lakes

Brussels
Amsterdam

Edinburgh
Glasgow
IDC
IDC
IDC
Edinburgh
PE1
Glasgow
PE1

Manchester

London
PE1

MPLS Network
Manchester SP1

London
PE2

Dublin PE1
PE1

Dublin

Stockholm
PE2

Copenhagen
PE1
Stockholm
PE1

Copenhagen

Milan
PE1

Brussels
PE1

Brussels
PE2
Amsterdam
PE2

MPLS
SP2

Milan
PE2
Madrid
PE2

Paris

Amsterdam
PE1

Zurich
PE2

Barcelona
PE1
Madrid
PE1

Paris
PE1IDC

Paris
PE2
Frankfurt
PE2

Frankfurt

Munich
PE2

Target State:
Single Regional
Vendor
Ethernet
L2 VPN soln
for regional
Branch Offices

Munich
Dusseldorf
PE1
Zurich
PE1

Stockholm

Munich
PE1
Hamburg
PE1

Hamburg
Milan

Madrid
Zurich

Dusseldorf

Barcelona

1990s

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1998

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2001

2005

Cisco Public

2010+

Cisco IT WAN Strategy

WAN Service Catalogue enables scalable manageable WAN

Office WAN Connectivity Service Catalogue

Small Branch
Service
Type
Technology

Office
Type

Global Solution
Many Vendors
Availability 99.7

DSL Internet access

& DMVPN
50 Offices
0-25 Users
2-15M

ISR

Small Branch /
Telecommuter
Presentation_ID

Branch Offices

Campus / DC

Regional Solution
Single Vendor / region
Availability 99.8

Global Backbone
Single Vendor / path
Availability 99.9

Ethernet Access & L2 VPN

regional cloud service
325 Offices
26-500 Users
34M-1G

EPL or SONET/SDH point to

point service

ISR

ASR

Campus / Data Center

Branch Office

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15 Offices
500+ user
1-10G

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High Level Business Requirements

Driving Network Change to Enable Business Growth

Capacity : Primary Application Driving Capacity Pervasive Video

Performance : Service metrics must compliment Realtime Traffic Flows

Scalability : Support Office growth, rapid change, moves or Integrations

Technology Freedom : Ability to choose technology direction & rapidly
deploy
Supportability : Solution must balance capabilities, vendors, availability,
contracts & cost
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Target Regional WAN Architecture

Enabling Flexible Scalable Bandwidth into the Branch Office

Ethernet Access
L2 VPN

Point to point service

Regional Branch Offices
Subject to Availability

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Decision Criteria
Requirement

L2 VPN

L3 VPN

IPv6

Enables seamless
deployment of IPv6

Routing Protocol

Customer Choice

Dependent upon Service

providers capability
Dependent upon Service
Provider

Branch to HQ/DC
Traffic flows

Point to point service

Multi-point service

Policy Per EVC Preferable

Aggregate headend policy

challenges

Granular QoS

Cisco IT Selection of Ethernet L2 VPN primarily driven by desire for greater technology flexibility
Source: Placeholder for Notes is 18 points
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Questions ?

Panelists
Jim Rampley
Principal Engineer, Charter Communications

Christopher Painter
Sr. Solutions Architect, Verizon

Alexei Sadovnikov,
Principal Technical Network Architect, IBM Enterprise Network @
AT&T GMS

Mike Anderson
Manager, Cisco IT

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Conclusion

Conclusion
Both L2VPN and L3VPN are valid choices for enterprises
L2VPN or L3VPN decision depends on many factors

L2VPN and L3VPN are NOT mutually exclusive

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