Recall that HDLC is the default serial encapsulation method when connecting two Cisco routers. With an added protocol type field, the Cisco version of HDLC is proprietary. Thus, Cisco HDLC can only work with other Cisco devices. However, when there is a need to connect to a non-Cisco router, PPP encapsulation should be used, as shown in the figure.

PPP encapsulation has been carefully designed to retain compatibility with most commonly used supporting hardware. PPP encapsulates data frames for transmission over Layer 2 physical links. PPP establishes a direct connection using serial cables, phone lines, trunk lines, cellular telephones, specialized radio links, or fiber-optic links.

PPP contains three main components: