Layer 3 VPNs are overlay networks that are built on the underlay service provider networks, with the SP network providing layer 3 services to the end users. The overlay network created using P2P tunnels is a type of a layer 3 VPN, where the underlay SP network provides transport of IP packets from one end to another. In addition, the network also provides routing functionality, and the routers R1 and R2 provide IP routing functionality and routed packets into the tunnels.
Another form of layer 3 VPN is an MPLS L3 VPN service that is offered by MPLS SPs. In an MPLS layer 3 VPN, the network acts like one big router, and all interfaces of the VPN behave like they are connected to that virtual router directly. Consider the network ...
