BGP Peer Groups provide a template to be applied to multiple BGP neighbors, which assigns one policy/update to each of them versus defining multiple policies/updates for multiple neighbors. This effectively saves CPU resources by building a single update for all peer group members.
There are a number of parameters that can be consolidated within a peer group:
- update-source
- next-hop
- EBGP multi-hop
- authentication password
- weight
- prefix-lists
- filter-lists
- route-maps
There are caveats to use of BGP Peer group:
- Individual parameters can be overridden per-neighbor; a parameter assignment to a neighbor overrides the conditions of the peer group membership, but only for incoming updates. (The same is not true for outgoing updates.)
- Internal and External peers cannot be combined into one peer group.
- TCP communications is still conducted on a per-neighbor basis due to the nature of TCP.
Ultimately, from a CPU processing standpoint, Cisco IOS assigns a peer-group leader. Updates are created for the leader but then replicated for the other peer group members.
Stuck-in-Active: Journal of an IT-Network Administrator 