VPC Peering vs Transit Gateway: Pick by Topology

VPC peering is point-to-point; transit gateway is hub-and-spoke. The decision rule based on topology and the cost crossover.

When peering wins

Few VPCs (≤4). Peering is cheaper at this scale.

Specific high-traffic pairs. Direct path is fastest.

When transit gateway wins

Many VPCs (5+). N×N peerings become unmanageable.

Complex topologies with shared services. Hub-and-spoke is the natural shape.

Cost crossover

Around 5-6 VPCs, transit gateway becomes cheaper despite hourly fee.

Recompute when scaling. Crossover varies by traffic patterns.