Geneve provides the overlay capability in NSX-T to create isolated, multi-tenant broadcast domains across data center fabrics, and enables customers to create elastic, logical networks that span physical network boundaries.

The first step in creating these logical networks is to isolate and pool the networking resources. By using the Geneve overlay, NSX-T isolates the network into a pool of capacity and separates the consumption of these services from the underlying physical infrastructure. This model is similar to the model vSphere uses to abstract compute capacity from the server hardware to create virtual pools of resources that can be consumed as a service. You can then organize the pool of network capacity in logical networks that are directly attached to specific applications.

Geneve is a tunneling mechanism which provides extensibility while still using the offload capabilities of NICs for performance improvement.

Geneve works by creating Layer 2 logical networks that are encapsulated in UDP packets. A Segment ID in every frame identifies the Geneve logical networks without the need for VLAN tags. As a result, many isolated Layer 2 networks can coexist on a common Layer 3 infrastructure using the same VLAN ID.

In the vSphere architecture, the encapsulation is performed between the virtual NIC of the guest VM and the logical port on the virtual switch, making the Geneve overlay transparent to both the guest virtual machines and the underlying Layer 3 network. The Tier-0 Gateway performs gateway services between overlay and non-overlay hosts, for example, a physical server or the Internet router. The NSX-T Edge virtual machine translates overlay segment IDs to VLAN IDs, so that non-overlay hosts can communicate with virtual machines on an overlay network.

The edge cluster hosts all NSX-T Edge virtual machine instances that connect to the corporate network for secure and centralized network administration.

Table 1. Geneve Overlay Design Decisions

Decision ID

Design Decision

Design Justification

Design Implication


Use NSX-T to introduce overlay networks for workloads.

Simplifies the network configuration by using centralized virtual network management.

  • Requires additional compute and storage resources to deploy NSX-T components.

  • Might require more training in NSX-T.


To provide virtualized network capabilities to workloads, use overlay networks with NSX-T Edge virtual machines and distributed routing.

Creates isolated, multi-tenant broadcast domains across data center fabrics to deploy elastic, logical networks that span physical network boundaries.

Requires configuring transport networks with an MTU size of at least 1600 bytes.