"Before we get into VPLS, let us take a quick look at MPLS Layer 2 VPNs also referred to as Point-Point services. A point-to-point L2VPN circuit, as defined by the PWE3 working group, is a provider service that offers a point-to-point service infrastructure over an IP/MPLS packet switched network. The PWE3 working group of the IETF describes mechanisms on how to deliver L2 VPN services across a packet switches IP/MPLS network. The basic reference model is outlined in the picture below. A pseudo-wire (PW) is a connection between two provider edge (PE) devices, which connects two attachment circuits (ACs). An AC can be a Frame Relay DLCI, an ATM VPI/VCI, an Ethernet port, a VLAN, a HDLC, a PPP connection on a physical interface, a PPP session from an L2TP tunnel, an MPLS LSP, etc. During the setup of a PW, the two PE routers will be configured or will automatically exchange information about the service to be emulated so that later they know how to process packets coming from the other end. The PE routers use Targeted LDP sessions for setting the PW. After a PW is set up between two PE routers, frames received by one PE from an AC are encapsulated and sent over the PW to the remote PE, where native frames are re-constructed and forwarded to the other CE"