Here's an alternate that uses some of your text with a lot of additions/subtractions:

A virtual guest's connection to any network is via software network components on the physical host. These software components can be rearranged and reconfigured via libvirt's virtual network configuration, so the host can be thought of as a virtual network switch that can be configured in many different ways to fit the guest's networking needs.


By default, all guests on a single host are connected to the same libvirt virtual network (aptly named "default"). Guests on this network can all make connections with each other (bidirectional, modulo any firewalls in the guest OS' network stack or libvirt nwfilter rules attached to the guest interface), with the virtualization host (also bidirectional modulo any fireall rules), and with other hosts on the network beyond the virtualization host (outbound only, via Network Address Translation (NAT) rules added to the host system firewall).

If needed, guest interfaces can instead be connected to:

  * a network that doesn't allow any traffic beyond the virtualization host
    (referred to in some documentation as "isolated" mode).

  * a network that routes traffic between the guest and external hosts without
    performing any NAT (this allows for incoming connections but requires extra
    routing table entries for sytems on the external network. This is called
    "route" mode in libvirt's virtual network configuration and documentation)

  * a bridge device that is also connected directly to a physical
    ethernet device which is connected to the local ethernet, making the
    guest directly visible on the physical network (this also allows incoming
    connections, but doesn't require any extra routing table entries. It is
    referred to in documentation as "bridged mode")

For simple outbound-only network access from virtual machines, no additional network setup should be needed, as the network named "default" is installed along with libvirt, and automatically started when the libvirt service is started. If more advanced functionality is needed, additional networks can be created and configured using either virsh or virt-manager, and the guest XML configuration file can be edited to use one of these new networks.

From the point of view of the guest OS, a virtual network connection is no different from a normal physical network connection. For further information on configuring networks in RHEL7 guests, see the Red Hat Enterprise Linux 7 Networking Guide.