MPLS explained

What are the different types of MPLS?

The version of MPLS that's generally used to encapsulate connection-oriented frame relay and ATM services is called pseudo Wire Edge to Edge Emulation (PWE3). PWE3 defines point-to-point tunnels across the MPLS backbone, and thus works well for circuit-oriented networking protocols. PWE3 can also be used to support connectionless LAN protocols, but it's not the preferred solution.

For connectionless protocols (primarily Ethernet) there's a different specification, called virtual private LAN service (VPLS). VPLS addresses some of the specific challenges with extending Ethernet across the metropolitan area or WAN, most notably scalability and availability. Another emerging spec is the ITU's transport-MPLS (T-MPLS), which is designed to simplify deployment of Ethernet services

It's worth noting that MPLS isn't the only game in town when it comes to Ethernet services, though. Several vendors --including Nortel, Extreme and Siemens-- are promoting an alternative approach called Provider Backbone Transport, or PBT, for metropolitan area Ethernet.

PBT is based on using existing IEEE 802.1 VLAN tags to deliver Ethernet services across a provider network. PBT competes head-to-head with T-MPLS, and the jury's still out on which one will gain the most traction.

Finally, a variant of MPLS called Generalized Multiprotocol Label Switching (GMPLS) gives routers the ability intelligently signal the optical layer, enabling providers to establish, change or tear down optical links in real time. Thus, service providers can provision "optical wavelength" services based on MPLS.