Virtual network peering enables you to connect two Azure virtual networks. Once peered, the virtual networks appear as one, for connectivity purposes.
VNet Peering Types :
- Regional VNet Peering : Connecting VNets within the same Azure region.
- Global VNet Peering : Connecting VNets across Azure regions.
VNet Peering Limitations and Constraints :
Virtual Networks peering connection cannot be created between VNets that have matching or Overlapping CIDR blocks.
We can't add address range to, or delete address ranges from a virtual network's address space once a virtual network is peered with another virtual network.
VNet Peering does not support transitive peering relationships.
VNet Peering is NONTRANSITIVE. This means that if you establish VNet Peering between VNet1 and VNet2 and between VNet2 and VNet3, VNet Peering capabilities do not apply between VNet1 and VNet3.This is shown in the below diagram:
How to overcome limitations of Vnet Peering?
You can deploy hub-and-spoke networks, where the hub virtual network can host infrastructure components such as a network virtual appliance or VPN gateway. All the spoke virtual networks can then peer with the hub virtual network. Traffic can flow through network virtual appliances or VPN gateways in the hub virtual network. This way all the networks can communicate with each other without any restrictions.
This reference architecture details a hub-spoke topology in Azure. The hub virtual network acts as a central point of connectivity to many spoke virtual networks. The hub can also be used as the connectivity point to your on-premises networks. The spoke virtual networks peer with the hub and can be used to isolate workloads.
The benefits of using a hub and spoke configuration include cost savings, overcoming subscription limits, and workload isolation.
Some of the imp links of MS on the topic :