Oracle Cloud Infrastructure has implemented one of its kind: Off-box network virtualization. As the name suggests, it pulls out the network and IO virtualization out of the software stack and puts it in the network. Basically you can have physical, dedicated hosts with no hypervisor overhead, noisy neighbours or shared resources with a full software-defined layer 3 network topology. You can enjoy the benefit of running bare metal hosts side-by-side with any class of systems like Virtual Machines(VMs) to Engineered Systems such as Exadata sharing the same set of APIs – meaning you can enjoy best of both worlds where benefitting from Exadata hardware(Infiniti Band) and software(smart scan, flash cache, columnar compression) features for your application along with cloud native security and governance capabilities of a layer 3 virtual cloud network.
The major benefits of Off-box network virtualisation is increase of network performance and higher level of security by providing isolation hence in case of any unforeseen attacks it affects single virtual network without touching other virtual networks.