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ticho sent in this article:

It seems weird that in this era of virtual everything that a number is hard to come by. The restrictions are real, however, because AWS restricts artificially the number of IP addresses you can bind to an interface on your VM. You have to buy a bigger VM to get more IP addresses, even if you don't need extra compute. Also, IPv6 is nowehre to be seen on the clouds, so addresses are more scarce than they need to be in the first place.

So the key problem is that you want to find a way to get tens or hundreds of IP addresses allocated to each VM.

Most workarounds to date have involved "overlay networking". You make a database in the cloud to track which IP address is attached to which container on each host VM. You then create tunnels between all the hosts so that everything can talk to everything. This works, kinda. It results in a mess of tunnels and much more complex routing than you would otherwise need. It also ruins performance for things like multicast and broadcast, because those are now exploding off through a myriad twisty tunnels, all looking the same.

The Fan is Canonical's answer to the container networking challenge.