A method of optical label swapping implemented by a switch used in a software defined network system that in one embodiment includes providing a 400-Gbit/s payload having a Nyquist shaped carrier in a 75-Ghz bandwidth spacing using a payload generator module controlling at least one first optical laser, and inserting a first optical label adjacent to the payload flow in a remainder of a 100-Ghz bandwidth with a label generator controlling at least one second optical laser. The label generator and the payload generator are controlled by a software defined network (SDN). A package of the payload and the first optical label is transmitted to a receiving node. The optical label can be swapped at the receiving node with a flex grid wavelength selective switch (WSS) controlled by the software defined network.