The figure illustrates a service provider that is providing Layer 3 services to the enterprise customer. The CE routers at the various customer sites connect to the provider edge (PE) of the service provider router. From a particular customer site perspective, every IP address that is not located on-site is reachable via the service provider IP backbone network.
In this environment, the service provider can provide value-added IP services to the customer by providing point-to-cloud SLAs for the conforming traffic from the customer. An SLA can, for example, divide customer traffic at the network edge into controlled latency, controlled load 1, and controlled load 2 classes, and then provide QoS assurances to each traffic class conforming to the contractual rate over a DiffServ IP backbone. For all nonconforming (exceeding) traffic, the service provider can re-mark and deliver all nonconforming traffic with best-effort service.
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