Route Summarization, or supernetting, is needed to reduce the number of routes that a router advertises to it neighbour. Remember that for every route you advertize, the size of your update grows. It has been said that if there was no route summarization, the internet backbone would have collapsed from the sheer size of its own routing tables in 1997.
Routing updates, whether done with a distance vector or link-state protocol, grow with the number of routes you need to advertize. In simple terms, a router that needs to advertize ten routes needs ten specific lines in its update packet. The more routes you have to advertize, the bigger the packet. The bigger the packet, the more bandwidth the update takes, reducing the bandwidth available to transfer data. But with route summarization, you can advertise many routes with only one line in an update packet. This reduces the size of the update, allowing you more bandwidth for data transfer.
Also, when a new data enters a router, the router must do a lookup in its routing table to determine which interface the traffic must be sent out. The larger the routing tables, the longer this takes, leading to more used router CPU cycles to perform the lookup. Therefore, a second reason for route summarization is that you want to minimize the amount of time the router CPU cycles that are used to route traffic.
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