Example of route resolution with BGP on loopback

Referring to the previous diagrams, let's see how "site1-1" resolves the route towards 10.0.2.0/24 received from "site1-2". In this example, the [blue] lines indicate the tag-based resolution, while the black lines refer to the standard best-match resolution.

Without the ADVPN shortcut, the BGP NH (the loopback of "site1-2") is recursively resolved through the loopback summary, which in turn is resolved through the /32 routes towards the Hub's loopback, injected by the exchange-ip-addrv4 feature over each of the overlays:

B 10.0.2.0/24 via 10.200.1.2

=> B 10.200.0.0/14 via 10.200.1.253

=> S 10.200.1.253/32 via ISP1

=> S 10.200.1.253/32 via MPLS

In this particular case, the Tag-based resolution plays no particular role. The outcome would be the same with the standard best-match resolution.

With the ADVPN shortcut (ISP1_0), the standard best-match resolution now uses the new /32 route towards the loopback IP of "site1-2", which is injected upon shortcut creation. (This route is not tagged!) At the same time, the Tag-based resolution still uses the tunnel summary, hence keeping the MPLS overlay in the list of results, so that the SD-WAN can switchover to an alternative overlay, should the ISP1 health degrade:

B 10.0.2.0/24 via 10.200.1.2

=> B 10.200.0.0/14 via 10.200.1.253

=> S 10.200.1.253/32 via MPLS

=> S 10.200.1.2/32 via ISP1_0

In summary, the Tag-based resolution (configured in "merge" mode) ensures correct SD-WAN operation in conjunction with ADVPN.