With Layer 2 Cisco switches like the 3500XL or 2950, a loopback interface is not needed since these switches are not capable of. You can define a virtual loopback interface by assigning an IPv4 or IPv6 address to the lo (local) interface. #Loopback interface macAnd this is the case where loopback address for router ID in OSPF is beneficial. Loopback interfaces do not have internal VLAN IDs or MAC addresses. But (!!) if any other router ( A, B, C or D) will have one (or more) of its interface(s) down, then if the router ID was not "set deterministically" - new advertisement will have to be sent onto the network, which will affected the overall bandwidth of it. On the other hand, if the router ID was set "deterministically" by configuring it to be the loopback address (or if there is any loopback address in the OSPF process), that will never go down (unless of course, the entire router/OSPF process will go down), then if any one of the interfaces of the router goes down, the router ID won't be affected, therfor no multicast OSPF "new router ID" messages will be sent onto the network.Ĭonsidering the above topology, in case router E (or more precisely its only interface) goes down, then anyway, when it will go up again it will still advertise its router ID "all over again". So, on any link failure for a specific router - if the logic of the router ID selection is still set on the "highest IP address" and there is no loopback address configured as well in the OSPF process (or there is no loopback address in the router at all) - then this link failure will trigger a new router ID selection procedure "within" the router and, perhaps more importantly, will obligate this router to advertise its "newly elected" router ID, meaning send OSPF messages again onto the network. This ID is chosen among ALL available interfaces on a given router UNLESS explicitly configured otherwise. As others mentioned, every OSPF router chooses a router ID. Adding to Maupin great answer I would further say that the (wise) choice of the router ID to be the loop back interface will be more "powerful" upon link failure scenarios.
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