Layer 2 devices switch Ethernet frames using MAC addresses, handling traffic between endpoints without involving IP routing. A virtual switch inside a Hyper-V host provides the same switching function for virtual machines as a physical switch does for physical NICs. It forwards frames between VM NICs and can connect to the external network through uplinks, all at the data link layer. A router operates at Layer 3, routing packets based on IP addresses rather than MAC addresses. A Hyper-V host is the computing platform that runs virtual machines, not a dedicated Layer 2 switch. NIC teaming is a method to aggregate multiple NICs for throughput or redundancy, but it’s not a separate switch-like device handling frame switching between endpoints.

The key idea is how multicast traffic is delivered efficiently in a switched network. By default, switches can’t tell which hosts want to receive a multicast stream, so they may flood that traffic to every port in the VLAN. IGMP (Internet Group Management Protocol) provides a mechanism for hosts to join or leave multicast groups. When a switch uses IGMP snooping, it listens to these IGMP reports and builds a per-group map of which ports have listeners. With this information, the switch forwards multicast frames only to the ports that have members of the group, not to every port. This targeted delivery prevents unnecessary flooding and reduces unnecessary load on the network. Other options don’t provide this selective delivery: unicast is a one-to-one delivery, multicast without filtering can flood, and broadcast goes to all ports indiscriminately. Using IGMP (via snooping) is the mechanism that minimizes flood for multicast traffic.

Switch Embedded Teaming is designed to combine multiple physical NICs to provide high-throughput, virtual-switch traffic for Hyper-V. The implementation sets a fixed limit on how many physical Ethernet adapters can be part of a single SET, and that limit is eight. This cap keeps traffic distribution efficient and the configuration manageable while still delivering substantial bandwidth by aggregating several adapters. So, SET can utilize up to eight physical Ethernet adapters.

Connecting to networks beyond the Hyper-V server is achieved by an External virtual switch. It binds to a physical network adapter on the host, so every VM connected to that switch appears on the same physical LAN as the host. This setup lets VMs access external resources, obtain addresses from the external DHCP server, and participate in VLANs if configured. Internal virtual switches only link VMs to the host, with no outside network access, while Private virtual switches keep VM traffic isolated to VMs themselves. So the External switch is the one that provides connectivity to networks outside the Hyper-V host.