What is a Virtual Network?

A virtual network allows companies and individuals to create a network that exists between computers and servers, despite local differences. This allows for many benefits from remote access capabilities to making it easier to troubleshoot and fix issues.

What is a Virtual Network?

A virtual network is a networking system that emulates a physical network by combining the hardware and software network resources to form a single administrative unit. A virtual switch (vSwitch) is a central component in virtual networks. It emulates virtually all the traditional Ethernet switches, performing functions such as forwarding frames and virtual local area network (VLAN) segmentation. When implemented correctly, they can enhance network scalability, streamline digital security, and minimize an organization’s costs.

virtual network

How does it work?

A virtual network connects virtual machines and devices, no matter their location, using the software. In a physical network, layer 2 and 3 functions of the OSI model happen within physical switches and routers. Plus, physical network interface cards (NIC) and network adapters are used to connect computers and servers to the network. Virtual networking shifts these and other activities to software. A software application called a virtual switch or vSwitch, controls and directs communication between the existing physical network and virtual parts of the network, like virtual machines. A virtual network adapter allows computers and VMs to connect to a network, making it possible for all the machines on a local area network (LAN) to connect to a larger network.

In a physical network, LANs are created to connect multiple devices to shared resources, like network storage, usually through Ethernet cables or Wi-Fi. However virtual networking creates the possibility for virtual LANs (VLANs), where the grouping is configured through software. This means that computers connected to different network switches can behave as if they’re all connected to the same one, and, conversely, computers that share cabling can be kept on separate networks, rather than physically connecting machines using cabling equipment and hardware.

Virtual networking delivers more centralized management and simplified network management. Disparate parts of the network can be accessed remotely for needed updates and changes, or even testing, making network management cheaper and easier.

Virtual networking is the foundation for cloud architectures and applications since it enables the ability to access, connect, secure, and modify cloud resources.

Types of Virtual Network

There are three classes: VPN, VLAN, and VXLAN:


VPN stands for the virtual private network. Essentially, a VPN uses the internet to connect two or more existing networks. This internet-based virtual network allows users to log in from anywhere to access the physical networks that are connected. VPNs are also used for masking internet use on public WiFi and ensuring secure browsing. A VPN is created when data attached to packets defines routing information that takes users to the applicable address. In doing this, a tunnel of addresses is created, encrypting the browsing history and making it possible to access information remotely. VPNs provide a small-scope, fully virtual network that uses the internet to allow people to connect.


A virtual LAN network, or VLAN, uses partitions to group devices on a LAN network into domains with resources and configurations that are applied to each. Using a VLAN allows for better security, monitoring, and management of the devices and servers within a specific domain. This is especially true for large networks that may be more vulnerable to attack when domains are not used and monitored individually.


VXLAN means a virtual extensible local area network. In this network, your level 3 network infrastructure provides a tunnel into level 2. Virtual switches create endpoints for each tunnel, and another piece of technology, called a physical or virtual base case, can route data between endpoints.

Some benefits 

They provide key benefits to networking, including the following:

  • Management. They provide better access management by segmenting and joining devices virtually instead of managing these components only physically.
  • Security. Better security is established by segmenting traffic and restricting access by groups, individuals, or devices.
  • Simplification. Virtual networking replaces hardcoded and rigid network routes with simplified, reduced paths that optimize access.
  • IP mobility. VMs can be moved across the network easily to different hosts while maintaining their IP address, which aids disaster recovery and load balancing.

virtual network

Challenges of virtual networks

Despite the benefits, they also have some potential challenges, including the following:

  • Extra layers of management. The management of the network occurs at both the physical and virtual layers.
  • Troubleshooting. Much like the management challenge, troubleshooting also happens at both the physical and virtual layers.
  • Potential security exposure. The negative effects of misconfiguration can be amplified across a wider set of devices or users.

Virtual Networking and Contemporary Business

In a changing world, virtual networking plays an important role in any digital business model. It’s an evolution of technology that addresses the need for remote accessibility, security, flexibility, scalability, and cost savings. Like many services that enterprise businesses can outsource, doing so has benefits in terms of time, money, and valuable resources that can be better spent ensuring all of your technology is meeting your business needs.

As societal conditions require that more people work remotely, virtual networking and NaaS services will continue to become more and more essential to all businesses. Increasing virtual networking capabilities may be the next phase in digital transformation for businesses that have already undergone the process of becoming digital enterprises. For instance, expanding your company’s virtual network to include more than a simple VPN for the added boost in productivity is one way businesses can continue to evolve in the digital world.


Virtual networking has many benefits over physical networking. It is much easier to set up and configure and can be quickly created and destroyed as needed. Virtual networks are also much more flexible than physical networks and can be easily reconfigured to meet changing needs. One of the main benefits is that they can be used to isolate network traffic. For example, a virtual network can segregate traffic between different departments or separate traffic between different customers. This allows for better security and performance, as each group of users is isolated from the others.

Companies or individuals can also use virtual networks to connect to remote networks, such as those in other countries. This can be done using a VPN service to encrypt the traffic between the two networks. This allows companies to securely connect to their partners and customers, even if they are located in different parts of the world. They are an important part of the modern network infrastructure and are becoming increasingly popular as more companies move to a cloud-based model.


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