167the PE adds the VLAN tag expected by the peer PE or a null tag, and then a PW label and a tunnellabel into the packet before sending the packet out. For a packet to be sent downstream, the PErewrites, removes, or retains the service delimiter depending on your configuration.According to the protocol, the packet encapsulation type of a PW is VLAN by default.H-VPLS implementationHierarchy of VPLS (H-VPLS) can extend the VPLS access range of a service provider and reduce costs.Advantages of H-VPLS access• H-VPLS has lower requirements on the multi-tenant unit switch (MTU-s). It has distinct hierarchieswhich fulfill definite tasks.• H-VPLS reduces the logical complexity of the fully meshed network consisting of PEs and theconfiguration complexity.H-VPLS with LSP accessFigure 40 H-VPLS with LSP accessAs shown in Figure 40, UPE functions as the MTU-s and establishes only a virtual link U-PW with NPE 1.It does not establish virtual links with any other peers.Data forwarding in H-VPLS with LSP access is as follows:1. Upon receiving a packet from a CE, UPE tags the packet with the MPLS label for the U-PW, namely,"the multiplex distinguishing flag," and then sends the packet to NPE 1.2. When receiving the packet, NPE 1 determines which VSI the packet belongs to by the label and,based on the destination MAC address of the packet, tags the packet with the multiplexdistinguishing flag for the N-PW, and forwards the packet.3. Upon receiving the packet from the N-PW, NPE 1 tags the packet with the multiplex distinguishingflag for the U-PW and sends the packet to UPE, which forwards the packet to the CE.For packets to be exchanged between CE 1 and CE 2, UPE can forward them directly without NPE 1because it holds the bridging function by itself. For the first packet with an unknown destination MACaddress or a broadcast packet, UPE broadcasts the packet to CE 2 through the bridging function and, atthe same time, forwards it through U-PW to NPE 1, which replicates the packet and sends a copy to eachpeer CE.