For port binding to work correctly, the initiator must be able to reach the target directly on the same subnet – iSCSI port binding in vSphere 5.0 does not support routing. In this configuration, if I place my VMkernel ports on VLAN 74, they will be able to reach the iSCSI target without the need of a router. This is an important point, and needs further elaboration as it causes some confusion. If I do not implement port binding, and use a standard VMkernel port, then my initiator can reach the targets through a routed network. This is supported and works just fine. It is only when iSCSI binding is implemented that a direct, non-routed network between the initiators and targets is required, i.e. initiators and targets must be on the same subnet.