[First Update] I received some feedback that vCloud Connector 2.0 does not actually use VXLAN as part of its DCE/Stretch Deploy feature. I am waiting on confirmation since several VMware blogs, including ones that I reference in my post, state that VXLAN is indeed used. As I also state in my post, I would actually be quite happy to know that VXLAN is not being used with DCE/Stretch Deploy.
[Second Update] I’ve confirmed that VXLAN is not required for DCE/Stretch Deploy in vCloud Connector 2.0. The Pre-GA post and GA post on VMware’s vCloud Blog, mistakenly referencing VXLAN as a requirement, should be corrected shortly. Many thanks to Massimo Re Ferre’ and Patrick Chang from VMware and Scott Lowe from EMC for chasing this down. It’s great to see another example of how the VMware community can help to correct each other’s mistakes, as well as those of VMware itself. The important thing is that the correct information is provided to the community and to the public.
Meanwhile, I took the content from this post and made the necessary edits to re-post as 2 separate blogs, one on “Datacenter Extension With vCloud Connector 2.0“and the other on “Word Of Caution About Overextending The Use Of VXLAN,” for those who are interested. Thank you for reading and providing much-needed feedback.
Cloud Architect Musings 
Reblogged this on Tech Craze.
To my understanding VXLAN will soon support unicast.
Thanks for your interest in vCloud Connector 2.0. The new Datacenter Extension (DCE) feature does NOT require VXLAN. It can work with either VXLAN or VLAN.
DCE uses a L2 extension technology that relies on SSLVPN to provide encrypted tunnel to extend an L2 network from a private datacenter to a public cloud. The underlying L2 network can be VLAN or VXLAN based. An encrypted tunnel is needed because the solution is intended to onboard customers to cloud over public internet.
vShield Edge provides the VPN interconnect to bridge the two networks using an encrypted channel. The local and remote networks become the same broadcast domain over the VPN tunnel which allows “bursting” or stretching the LAN into the Cloud and avoids IP renumbering of VMs.
Patrick,
Thanks for the clarification. I chatted with Massimo earlier about this. It appears that there is incorrect information in some of the internal VMware blogs which need to be corrected. I will update my blog shortly with the correct information.
Kenneth