Tech Matchups: VPC Peering vs Transit Gateway
Overview
VPC Peering enables direct network connectivity between two AWS Virtual Private Clouds (VPCs) using private IP addresses, ideal for simple, point-to-point connections.
Transit Gateway acts as a scalable network hub, connecting multiple VPCs and on-premises networks through a single gateway, simplifying complex architectures.
Both facilitate inter-VPC communication: VPC Peering for small-scale setups, Transit Gateway for enterprise-grade networks.
Section 1 - Connectivity and Scalability
VPC Peering establishes a direct connection between two VPCs—example: connecting a dev VPC (10.0.0.0/16) to a prod VPC (10.1.0.0/16) for resource sharing. Setup takes ~5 minutes via AWS Console, requiring route table updates.
Transit Gateway connects multiple VPCs and on-premises networks—example: linking 10 VPCs and a Direct Connect in a hub-and-spoke model. Configuration takes ~10 minutes, with dynamic routing via BGP.
VPC Peering scales poorly beyond 10 VPCs due to manual peering (n*(n-1)/2 connections for n VPCs, e.g., 45 for 10 VPCs). Transit Gateway scales to thousands, centralizing routing—e.g., 100 VPCs need only 100 attachments. Peering suits small projects; Transit Gateway excels in enterprise scale.
Scenario: A startup with 3 VPCs uses peering for simplicity; a corporation with 50 VPCs adopts Transit Gateway for manageability.
Section 2 - Routing Complexity
VPC Peering requires manual route table updates for each connection—e.g., adding 10.1.0.0/16 to a VPC’s route table for peering. Overlapping CIDRs (e.g., 10.0.0.0/16 in both VPCs) break connectivity, requiring careful IP planning.
Transit Gateway simplifies routing with a centralized route table—e.g., one rule propagates 10.0.0.0/16 to all attached VPCs. It supports dynamic routing (BGP) and CIDR overlap resolution via route domains.
Scenario: Peering a new VPC adds 10 route table entries for 10 existing VPCs; Transit Gateway adds one attachment, auto-propagating routes. Peering’s hands-on; Transit Gateway’s automated.
Section 3 - Cost Considerations
VPC Peering incurs data transfer costs—e.g., $0.02/GB for cross-AZ peering in us-east-1. No hourly charge, making it cost-effective for low VPC counts. Example: 1TB/month cross-AZ transfer costs $20.48.
Transit Gateway charges hourly ($0.05/hour per attachment in us-east-1) plus data processing fees ($0.02/GB). Example: 10 VPCs with 1TB/month traffic costs ~$360/month (10 attachments * $36 + $20.48 data). Scales better for high VPC counts.
Scenario: A 2-VPC setup with 500GB/month favors peering (~$10/month); a 20-VPC setup with 5TB/month leans toward Transit Gateway (~$720 vs. $2048 for peering). Peering’s cheaper initially; Transit Gateway saves at scale.
Section 4 - Security and Isolation
VPC Peering relies on Security Groups and NACLs for traffic control—e.g., allowing 10.1.0.0/16 on port 80. Full network exposure between VPCs requires tight rules to limit access.
Transit Gateway integrates with AWS Network Firewall and route domains—e.g., isolating dev VPCs from prod VPCs via separate routing policies. Supports fine-grained control without full VPC exposure.
Scenario: Peering needs 10 Security Group rules for 10 VPCs; Transit Gateway uses one firewall policy for all. Peering’s granular; Transit Gateway’s centralized.
Section 5 - Comparison Table
| Aspect | VPC Peering | Transit Gateway |
|---|---|---|
| Scalability | Limited (~10 VPCs) | High (5,000 attachments) |
| Routing | Manual, Static | Centralized, Dynamic (BGP) |
| Cost | Data transfer only | Hourly + Data fees |
| Security | Security Groups/NACLs | Network Firewall, Route Domains |
| Best For | Small-scale, Simple | Enterprise, Complex |
VPC Peering fits small, budget-conscious setups; Transit Gateway powers large, automated networks. Choose based on scale and complexity.
Conclusion
VPC Peering and Transit Gateway address inter-VPC connectivity with distinct strengths. Peering suits startups or small projects with 2-5 VPCs, offering low-cost, straightforward connectivity. Transit Gateway excels in enterprises with 10+ VPCs or hybrid clouds, providing scalability and centralized management.
Weigh VPC count (few vs. many), routing needs (static vs. dynamic), and budget (data-only vs. hourly fees). Start with peering for prototypes; adopt Transit Gateway for production at scale—or combine: use peering for isolated pairs, Transit Gateway for core hubs.