VPN Service Provider as the Customer

A VPN service provider can have customers that are themselves VPN service providers. In this type of configuration, also called a hierarchical or recursive VPN, the customer VPN service provider's VPN-IPv4 routes are considered external routes, and the backbone VPN service provider does not import them into its VRF table. The backbone VPN service provider only imports the customer VPN service provider's internal routes into its VRF.

This type of configuration is similar to the configuration described in the Internet Service Provider as the Customer section. The similarities and differences are shown in Table 5.

Table 5: Comparison of Interprovider and Carrier-of-Carriers VPNs

Feature	ISP Customer	VPN Service Provider Customer
Customer edge device	AS border router	PE router
IBGP sessions	Carry IPv4 routes	Carry external VPN-IPv4 routes with associated labels
Forwarding within the customer network	MPLS is optional	MPLS is required