Understanding Underlay and Overlay Networks in SDN
An underlay network is the physical infrastructure that provides basic IP connectivity, while an overlay network is a virtual topology built on top of the underlay to support dynamic services.
The Underlay Network Explained
The **underlay network** is the physical foundation of your network infrastructure. It consists of the actual hardware—routers, switches, cables—and the fundamental routing protocols (like OSPF or IS-IS) that provide basic IP reachability between all nodes. Its primary job is to be robust, fast, and ensure that any node can communicate with any other node physically.
What is an Overlay Network?
An **overlay network** is a virtual network created on top of the physical underlay. It uses tunneling technologies (such as VXLAN, GRE, or IPsec) to encapsulate traffic. The overlay is where the "smart" networking happens—it's highly flexible, supports multi-tenancy, and can be rapidly reconfigured by an SDN controller without touching the physical underlay hardware.
Why Decouple Them?
Decoupling the overlay from the underlay allows network engineers to achieve greater agility. The physical underlay rarely needs to change, providing a stable foundation. Meanwhile, new virtual networks (overlays) can be spun up or torn down programmatically to meet application demands instantly.
❓ Frequently Asked Questions
What is an example of an overlay technology?
VXLAN (Virtual eXtensible LAN) is a common protocol used to create overlay networks in data centers.
Does the underlay care about overlay traffic?
No, the underlay only sees encapsulated IP packets and forwards them based on standard IP routing.
Why is OSPF used in the underlay?
OSPF is often used because it provides fast convergence and reliable routing within a single administrative domain.