Under most circumstances you would choose IP. The 803.3ad as well as static etherchannels do afford you the option to choose the load-balancing algorithm on each side of the channel. This is because the load-balancing algorithm is used on the transmit side only.
You can determine what your Cisco switch is using by running the following command
show etherchannel load-balance
Most new Cisco switches default to IP but many older switches like that Catalyst 3550 for example and certain legacy chassis based switches will only use MAC based.
Now why you would choose one over the other. If you have clients accessing the NetApp from many different subnets then you would want IP based load-balancing. This is because the source IP and destination IP never changes. MAC on the other hand does change as you traverse router hops. For example All clients accessing your netapp from other subnets would always have the source mac of the local subnets router and the destination mac of the NetApp. This would cause all traffic to be load-balanced to one of the links in the etherchannel, which would likely be bad.
NetApp does an excellent write up of how this works and gives you some great Cisco configuration suggestions for use with their products.
We are pleased to announce availability of Beta software for 16.6.3.
16.6.3 will be the second rebuild on the 16.6 release train targeted
towards Catalyst 9500/9400/9300/3850/3650 switching platforms. We are
looking for early feedback from customers befor...
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