R2 is in-band CAS signaling while C7/SS7 is an out-of-band common channel. R2 uses ch 16 (or TS 15) on every E1 for all signaling/call setup/tear-down for that particular E1. It also uses MF or DTMF for the setup. C7/SS7 uses 64Kbs or 56Kbs channel that can be part of the E1/T1(i.e. ISDN or F-Links) or on a seperate facility(A-Links). All signaling b/w two switches can be done on that same link (thus can handle thousands of call setup on one channel). R2 implementation also varies from country to country(how they pattern the forward and backwards tone for instance)