In an earlier post I talked about VMware using VXLAN as an option for extending the virtual datacenter across physical datacenters. I’ve gotten quite a few questions on how this differs from Cisco’s OTV using Nexus 7K switches. They are actually two different solutions with two different use cases. VXLAN’s primary use in production is to overcome the limitation of 4096 VLAN. VXLAN allows up to 16M virtually addressed networks. At VMworld 2012 VMware did show a demo of moving a VM from a private cloud to a public cloud keeping the same addressing using VXLAN. They didn’t specify if VXLAN was the only encapsulation protocol used but I’d think it would be a challenge setting up OTV between two Cisco Switches controlled by to different entities. Instead of going into detail between the two protocols I’ll leave the explanation to Scott Lowe who has already written a pretty good post on the two solutions.