PIM-SM (Sparse Mode) is most effective in large networks in which few hosts receive multicast traffic. PIM-SM devices are organized into domains. A PIM-SM domain is a contiguous set of devices that all implement PIM and are configured to operate in a common boundary.
In PIM-SM, unidirectional, shared distribution trees are rooted at a common node in the network called the rendezvous point (RP). The RP acts as the messenger between the source and the destination hosts or routers. An RP is configured statically per PIM router or by means of a bootstrap router (BSR). The RP must always be upstream from the destination hosts or routers.
Hosts and routers send Join messages to the RP for a group. To reduce the number of Join messages incoming to an RP, the local network selects one of its upstream routers as the designated router (DR). All hosts below a DR send Join messages to the DR. The DR sends only one Join message to the RP on behalf of its hosts.
In IPv6 PIM-SM, you can create a source-based distribution tree, which is rooted at a router that is adjacent to the source. With this option, destination hosts can switch from the shared tree to the source-based tree if the latter has a shorter path between the source and the destination.