VPLS networks explained

What is VPLS?

VPLS (Virtual Private LAN Service) is a virtual private network (VPN) that links multiple sites into a single Ethernet-based domain. It connects dispersed local area networks (LANs) into one secure, high-speed wide area network (WAN), so your remote offices act as if they share the same local network.

VPLS provides any-to-any connectivity: each site connects directly to every other site. For example, here’s Neos Networks VPLS, which leverages our high capacity, UK-wide core network:

Neos Networks VPLS

How does VPLS work?

VPLS emulates the functionality of a traditional Ethernet LAN, making distant locations behave as if they’re on the same LAN. It typically runs over your provider’s MPLS backbone, which ensures predictable paths and low latency.

The service learns MAC addresses and works like a large virtual switch, forwarding traffic to the correct destination. Every site can talk to every other one on the network without routing through a central hub, reducing latency and improving resilience.

What’s the difference between VPLS and MPLS?

The key difference between VPLS and MPLS is that MPLS is the underlying transport technology, while VPLS is a service built on top of it to extend LAN functionality:

• MPLS operates between Layer 2 and Layer 3 of the OSI model. It uses labels to route IP packets and supports advanced Quality of Service (QoS) and traffic engineering.
• VPLS works at Layer 2. It acts like a giant Ethernet switch across all your sites, forwarding traffic to the right destination.

MPLS Layer 3 VPNs typically use point-to-point (P2P) or hub-and-spoke design, and they don’t forward Ethernet broadcast or multicast traffic by default.

By contrast, VPLS uses pseudowires (virtual connections) to create an any-to-any network, forwarding Ethernet traffic like a LAN – ideal for business applications such as voice and video.

In short, MPLS can work well if you need granular IP routing, traffic engineering and advanced QoS across a WAN. VPLS is better if you simply want to extend your Ethernet LAN seamlessly across your sites without moving to a Layer 3 architecture.

But what if you need to combine Ethernet with other connection types?

VPLS vs SD-WAN

Both VPLS and SD-WAN connect multiple sites, but SD-WAN gives you more flexibility:

• VPLS extends your Ethernet LAN across your sites, typically using MPLS as the transport. It works at Layer 2 and relies on predefined MPLS paths for predictable performance.
• SD-WAN creates a software-defined overlay at Layer 3 that sits on top of any underlay – MPLS, internet or 4G/5G. It routes traffic dynamically across multiple connection types, giving you centralised control, real-time visibility and direct access to cloud services.

So if you need fast, low latency LAN-like performance for critical applications, VPLS may be right for you. If you need more flexible, hybrid connectivity with easy cloud integration, SD-WAN may be the better choice.

Learn more about SD-WAN

Is VPLS secure for my business?

VPLS is secure because it runs over your provider’s private core network, not the public internet. Customer traffic is logically separated using MPLS labels, so each organisation’s data stays isolated.

VPLS also limits external visibility. Your Layer 2 traffic is carried across the provider’s network, but your internal IP addressing and routing decisions remain within your own network.

However, VPLS doesn’t encrypt traffic by default. If traffic were compromised inside a provider’s core network, the data packets could theoretically be read.

So if you’re in a regulated sector like healthcare, finance or the public sector, you should add encryption. MACsec or IPsec overlays are commonly used to meet compliance and data-protection regulations.

Overall, VPLS provides a secure network for most business use cases. But security ultimately depends on your provider’s infrastructure. Choose a provider you can trust with a resilient, B2B-only backbone and proven track record.

What are the advantages of VPLS?

VPLS offers several benefits if you need to link multiple sites across a wide area network:

Common VPLS limitations

VPLS is secure, but it doesn’t have native encryption. If you’re in a highly regulated industry, you may need to add external encryption to meet compliance requirements.

You can easily add new sites to your network using a full mesh of pseudowires – virtual point-to-point connections. But the design can become complex as the number of sites grows.

VPLS also transmits all broadcast (one-to-all), unknown unicast (one-to-one when the destination isn’t known), and multicast (one-to-many) traffic across the entire mesh. In larger deployments, this can use unnecessary bandwidth and increase the risk of traffic flooding.

So VPLS can be a great choice for small or medium-sized networks that need LAN-like performance across multiple sites. It’s less suited to very large, complex or cloud-first network architectures.

VPLS use cases

A VPLS network can be ideal for several enterprise applications, including:

• Connecting multisite businesses: VPLS links all your offices into one Ethernet domain, so teams share resources as if they’re on the same LAN.
• Data centre interconnects: It delivers high capacity, low latency connectivity for syncing workloads, storage and backup.
• Financial services: Low latency and consistent performance support trading platforms and real-time data feeds.
• Healthcare: Hospitals and clinics can share large imaging files across sites without relying on the public internet.
• Retail: You can run centralised point-of-sale systems and inventory management across multiple branches with consistent performance.
• Manufacturing: Factories can connect production systems and IoT devices to headquarters for real-time monitoring and control.

But whatever your sector, your VPLS network will only perform as well as your provider’s underlying infrastructure.

How to choose a VPLS provider

From initial design to long-term growth, you need a provider that can deliver the performance, scale and reliability your organisation depends on. Here are some questions to consider when weighing your options.

Network reach

Can they connect all your sites, including remote locations? Do they offer a choice of access tails?

Performance guarantees

Do they offer SLAs that support your business‑critical applications? Do they spell out the uptime and fix times you can expect?

Resilience and reliability

Do they run a resilient core network with built-in redundancy? Do they offer diverse routing and failover options across your network?

Security options

How is your traffic separated on their infrastructure? Do they support encryption methods like MACsec and IPsec?

Service flexibility

Can you upgrade bandwidth and add sites quickly? Can they integrate with MPLS, SD‑WAN or cloud services as your needs evolve?

Operational support

Do they offer proactive monitoring and fast fault resolution? Do they have 24/7, UK-based customer service and engineering teams?

Commercial transparency

Are the costs clear, with predictable pricing for access, bandwidth and contract changes? Do the contract terms give you the flexibility your organisation needs?

Track record

Do they have experience delivering complex VPLS deployments for businesses like yours? Providers may promise the earth, but can they deliver?

Ultimately, do you trust them to deliver what they promise, when they promise it?

VPLS solutions

If you’re looking for a VPLS provider you can trust to deliver, Neos Networks can help. Enterprise and public sector organisations trust us to connect Critical National Infrastructure across the UK.

To explore our high capacity, low latency Business Ethernet services – including VPLS for multisite connectivity – download our brochure.

Not sure whether VPLS, SD-WAN or another service is right for your organisation? Get in touch. We’ll help you build a future-ready network you can scale as you grow.