Recent advances in P2P technology have made it a viable alternative for the delivery of rich media by both content and service providers. However, to better understand and utilize P2P technologies in building a scalable media distribution platform, the nature of the underlying network must be taken into consideration. Although many P2P simulations have been conducted previously, very few were evaluated on a real P2P testbed with the properties of the physical network in mind. In this paper, we describe VP2P, a virtual machine-based P2P testbed, which supports P2P studies with the consideration of typical service provider networks. We use four fully equipped MacPro's to emulate 32 peers in the current implementation. Experiments of three P2P algorithms for video on demand (VoD) services: BitTorrent, Toast, and Zebra, were run on the testbed. We discuss the rationales behind the hardware and software architecture of VP2P, report our results, and conclude with lessons learned and future directions for VM-based testbeds.