With layer 3 to the host are we still expected to use overlay networks or is there another technology or design you would suggest? In the Midwest I have yet to see a company even use Overlay since they use L2 between all hosts.
I spend a lot of time working in the Midwest. I agree that there are a lot of L2 networks out there, but I promise you there is a decent footprint of overlay networking being used in the belt buckle. It's just not well advertised.