A network hypervisor is a program that provides an abstraction layer for network hardware.
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Network hypervisors allow network engineers to create virtual networks that are completely decoupled and independent from the underlying physical network. The hypervisor enables segments of a virtual network to be managed independently and to be provisioned dynamically.
In the world of hyperscale computing, physical components that make up the network (such as switches, routers and firewalls) can be virtualized to accommodate the traffic demands created by server virtualization. Once networking components have been virtualized, network engineers need to be able to programmatically control the provisioning and management of these resources. While some capabilities are provided by the hypervisors in each virtual server, more robust programming is required to treat all servers and services in the network as a single pool of resources. That's where the network hypervisor comes in.
Not all vendors are using the term "network hypervisor" to describe the program that provides an abstraction layer for network hardware. Some vendors are using the label software-defined networking controller instead.
See also: FlowVisor