This design option has a dedicated Edge cluster that is not managed by vCloud Director and introduces a new edge gateway type—provider edge. Provider edges are manually deployed by the service provider outside of vCloud Director into the Edge cluster. Provider edge external uplinks are connected to external VLAN-based networks, while internal interfaces are connected to a transit VXLAN logical switch spanning all Compute and Edge clusters (using manually created transport zone with all clusters). The transit networks are then consumed by vCloud Director as external networks.

The provider edges can provide all VMware NSX functionality (dynamic routing protocols on external uplinks, Layer 2 bridging, Layer 2 VPN, and so on). They can scale as additional vCloud Director external networks are added (the current maximum in vCloud Director 8.20 is 1999 external networks). The edges deployed by vCloud Director then go into compute clusters because all their interfaces connect to VXLAN logical switches spanned everywhere in the provider VDC.