Layer 3 VPNs—The service provider participates in the customer’s Layer 3 routing. Layer 3 VPNs allow customers to leverage the service provider’s technical expertise to ensure efficient site-to-site routing. The customer’s CE switch uses a routing protocol such as BGP or OSPF to communicate with the provider’s PE switch to carry IP prefixes across the network. MPLS-based Layer 3 VPNs use IP over MPLS. Other protocol packets are not supported.
Layer 2 VPNs—The service provider interconnects customer sites using Layer 2 technology. Layer 2 VPNs give customers complete control over their own routing.