How Openstack works
Virtual to physical Data flow
Each server on the left and right of the IP fabric, shown in the diagram, has been virtualized with a hypervisor. Each hypervisor has a Virtual Tunnel Endpoint (VTEP) inside that handles the encapsulation of data plane traffic between virtual machines. Each VTEP also handles MAC address learning, provisioning of new virtual networks, and other configuration changes. The server on top of the IP fabric is a simple physical server, but doesn’t have any VTEP capabilities of its own. In order for the physical server to participate in the overlay architecture, it needs something to encapsulate the data plane traffic and perform MAC address learning. Being able to handle the VTEP role inside of an access switch simplifies the overlay architecture. Now each access switch that has physical servers connected to it can simply perform the overlay encapsulation and control plane on behalf of the physical server. From the point of view of the physical server, it simply just sends traffic into the network without having to do anything else.