What is Multiprotocol Label Switching (MPLS)?

Multiprotocol Label Switching, often abbreviated to MPLS, is a method in network engineering primarily designed to optimize speed and performance of communications. It uses short path labels rather than long network addresses to direct data packets from one node to the next. This technique diverges from traditional routing methods in which each router must make independent forwarding decisions based solely on a packet’s header information.

What truly sets MPLS apart? Efficiency of data transmission. 

It’s important to note the flexibility of MPLS, which supports multiple network protocols. From Ethernet to serial links, it functions seamlessly across varied networking technologies, making it versatile in effectively handling different types of internet traffic.

MPLS helps IT teams work smarter, not harder, by alleviating potential bottlenecks in telecommunications networks before they disrupt service quality or overall performance. Now that we’ve covered what defines MPLS protocol, let’s take a closer look at how it works and the types of Multiprotocol Label Switching that are available.

How does MPLS work?

To fully understand Multiprotocol Label Switching (MPLS), it’s important to become familiar with its core component: label switching protocol. This approach is what allows MPLS to optimize data routing in a unique and highly efficient manner.

The role of labels

MPLS operates by assigning labels to packets of data as they enter the network. These labels contain critical information about the path that the packet should follow through the network. Think of it as a detailed instruction set placed on each data package before it goes out for delivery, ensuring it reaches its destination via the most optimal route possible.

The MPLS process: a closer look

Here are the steps involved in the MPLS process in brief detail:

  1. Label assignment: As data enters an MPLS network, the first device it encounters is called a Label Edge Router (LER). LER assigns an appropriate label based on predetermined criteria, which correlates with specific forwarding Equivalence Classes (FECs). FECs group packets together destined for the same exit point from the network.
  2. Label switching: Once labeled, packets move through various routers — specifically called Label Switch Routers (LSRs). These routers don’t analyze IP headers like traditional routers but rather look at the MPLS labels to determine how to forward packets toward their destination.
  3. Label adjustment and removal: As packets travel through different parts of the network, their labels can be changed by passing LSRs if required due to changing conditions or better paths becoming available. When reaching another LER at the edge of the MPLS domain closest to its destination, this router removes the labels and forwards them mainly based on IP headers — or by other predefined criteria for final delivery.

Efficiency through simplification

By utilizing labels that dictate routing paths — at large avoiding the typical complex analysis done on IP headers — MPLS significantly simplifies data forwarding. This streamlined process not only accelerates traffic flow across networks but also improves overall efficiency and performance.

What is MPLS used for?

Multiprotocol Label Switching, or MPLS, has become instrumental in shaping the efficiency and management of network traffic flows. The technology excels at steering data from one network node to another using short path labels rather than long network addresses, thus avoiding complex lookups in a routing table.

MPLS is versatile across varied applications within telecommunications and IT infrastructures. Here are some of the primary uses of MPLS:

  • Traffic engineering: With MPLS, data packets can be directed across multiple routes based on current network conditions and bandwidth availability, without adhering strictly to internet protocols. This makes network traffic engineering more efficient and streamlined.
  • Quality of Service (QoS): In environments where multiple services are required simultaneously (such as VoIP, video conferencing, and large-scale data transfer), maintaining quality service becomes crucial. MPLS ensures data flow remains stable and predictable despite different levels of service demand.
  • VPN configurations: Virtual Private Networks (VPNs) benefit immensely from MPLS because it allows for creating highly scalable IP VPNs with ease. Unlike traditional methods that require extensive protocol overlay configurations, an MPLS framework helps streamline secure communications across a multitude of endpoints using labeled paths.

A nuanced handling of network transmissions is vital in our interconnected digital era. MPLS is beneficial for businesses seeking efficient ways to handle the increasing demands on their networks, while improving overall communication reliability and reducing latency issues.

Types of MPLS

Multiprotocol Label Switching (MPLS) offers a versatile approach to managing network traffic flows. There are several types of MPLS and applications suited to various settings. Generally speaking, there are three primary types, each designed to cater to specific network requirements and scenarios:

1. Layer 2 point-to-point

A foundational type of MPLS, Layer 2 point-to-point works by connecting two locations over a pseudo wire. It offers significant efficiencies for businesses that require high-performance connectivity between two sites. This setup effectively emulates a long Ethernet cable stretched between two points, regardless of their physical distance from each other.

This MPLS type ensures performance as well as better privacy and security by maintaining a controlled path across the provider’s network.

Quick overview:

  • Ideal for businesses needing dedicated, secure links.
  • Simplifies the network through providing direct connections.

2. Layer 2 Virtual Private LAN Services (VPLS)

Layer 2 Virtual Private LAN Services (VPLS) is a more complex setup for MPLS. VPLS extends the simplicity of point-to-point connections across multiple sites, emulating a traditional Local Area Network (LAN) over a Wide Area Network (WAN). The advantage of VPLS lies in its ability to connect several sites together with great speed and efficiency, as though they were plugged into the same switch.

VPLS supports flexible deployment architectures and can significantly reduce network complexity.

Quick overview:

  • Connects multiple locations seamlessly.
  • Enables all sites to communicate as if on single LAN.

3. Layer 3 IP/VPN

The most sophisticated among MPLS types is the Layer 3 IP VPN. Geared towards multi-site enterprises operating globally or regionally, this variant utilizes IP routing features combined with VPN capabilities. Complex networks are simplified down through technologies that encapsulate data into labels, translating into enhanced speeds. Security protocols such as encryption are not native, but can be implemented additionally.

For companies dealing with global communications or requiring reliable access to cloud-based systems irrespective of location, Layer 3 MPLS is an indispensable solution.

Quick overview:

  • Facilitates efficient routing for large-scale operations.
  • Offers robust options for interconnecting numerous locales while keeping critical data secure.

From basic direct links of Layer 2 point-to-point settings, to highly integrated solutions of full-fledged L3VPNs, MPLS provides crucial flexibility in networking strategies of modern enterprises. Understanding which type fits your business needs is vital to building optimal operational networks that are resilient against technological shifts and changing demands.


MPLS is used in telecommunications networks to direct data from one network node to the next based on short path labels rather than long network addresses. It provides efficient data transmission and traffic engineering but requires dedicated hardware and is often expensive.

SD-WAN (Software-Defined Wide Area Network), on the other hand, simplifies the management and operation of a WAN by using software to route traffic across the network, rather than networking hardware. This provides enhanced visibility into network operations and allows for centralized management through software controls. 

Comparing the two technologies

When exploring network technologies, it’s important to note the differences and applicabilities of Multiprotocol Label Switching (MPLS) versus Software-Defined Wide Area Networking (SD-WAN). Each offers distinct advantages depending on your organization’s needs, budget constraints, and desired network performance.

Cost efficiency

Generally speaking, setting up and maintaining an SD-WAN is less expensive compared to MPLS due to its reliance on software broadband connections, rather than dedicated hardware leased from providers. 


For applications requiring stringent control over latency and jitter, MPLS typically outperforms SD-WAN, although recent advances in SD-WAN technology are narrowing this gap.

Flexibility and scalability

SD-WAN offers superior flexibility. Adjustments can be made centrally through software configurations rather than physical changes within hardware setups associated with MPLS.

Security posture

Both technologies offer robust security options but achieve this through different methods: MPLS inherently isolates data while in transit using labels whereas SD-WAN uses encryption techniques over internet paths.

Choosing between MPLS and SD-WAN should take into account factors such as security needs, organization size, geographic spread of connected sites, end-user requirements, and available expertise to manage network infrastructure. Many enterprises are transitioning towards a hybrid model that includes both technologies, due to the optimal balance between performance demands and operating costs that it provides.

Benefits of using MPLS networks

Exploring the advantages of Multiprotocol Label Switching (MPLS) networks, it’s clear why many organizations opt for this technology. MPLS networks provide enhanced performance, reliability, and efficiency in handling data traffic across wide area networks (WANs). Here are each of the benefits of MPLS networks in more detail:

Performance optimization

One of the key features of an MPLS network is its ability to reduce packet loss and ensure a high quality of service (QoS). By prioritizing data packets based on types — voice, video, or essential application data — MPLS helps maintain superior performance levels:

  • Traffic prioritization: Allocates bandwidth dynamically to meet different traffic needs.
  • Reduced latency: Streamlines data flow that results in quicker response times.

These capabilities are particularly beneficial for applications requiring real-time interaction, like VoIP or conferencing systems.

Increased reliability and flexibility

Reliability is a cornerstone of MPLS networks, due to their inherent design that supports multiple pathways for data transmission. This multipath routing not only enhances resilience but also balances load across the network, thus mitigating potential points of failure:

  • Automatic redirection: In event of a link failure, MPLS automatically reroutes traffic without impacting users.
  • Scalability: Easily adapts to changes in network size and complexity.

This flexibility ensures that as your organization grows or shifts priorities, your network readily adjusts.

Simplified network management

Handling networking across distributed geographical locations can be complex. However, MPLS simplifies management through its centralized control structure. This makes it easier to implement and manage policies uniformly over the entire network. Furthermore, because labels identify path destinations rather than relying on complex address lookups at every stop, hardware can expedite processing speed, which further facilitates management tasks.

Implementing an MPLS strategy is a giant step towards operational excellence and robust technical infrastructure setup. With MPLS, businesses are positioned with a distinct competitive advantage in network performance and efficiency in today’s fast-paced market environments.

Switching with Atera

By answering questions such as “what is MPLS used for” and “what are the types of MPLS”,  IT professionals can gain vital insights into how leveraging MPLS optimizes network performance and reliability. With Atera’s all-in-one IT management tool, IT teams can streamline MPLS management, together with a broad range of IT functions, powered by AI to boost operations, security, and scalability of networks. Start your free trial with Atera today.

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