There are two basic schemes which have been adapted to encapsulate and transmit IP packets over serial point to point links. The older protocol is called SLIP (Serial Line Internet Protocol) and the newer version in known as PPP (Point to Point Protocol). The dates though can be slightly misleading as although SLIP is the original protocol you’ll find PPP is more popular because it can work with other protocols. This crucially includes IPX (Inter network Packet Exchange) – the PPP protocol is defined in RFC 1661-1663.
So what does PPP provide? Well it is important in many ways including it’s core functions providing router to router and host to host connections. PPP was also very commonly used to provide a connection on old modem and dial up connections for home users to connect to their ISP. In fact it is still used in that context using more modern cable or data modems and routers. When the modem has connected to the ISP a connection is made between the users hardware and the ISPs gateway. The setup of the connection includes authentication and also the assignment of an IP address.
When this connection is established the users computer is actually then an extension of the ISP network and the physical ports have the same functionality as any other serial or network card connected on the network. It is important that the IP address is assigned correctly as it is essential to communicate over the internet. In fact it also should be registered to the host country too otherwise there will be issues regarding region blocks as described in this article – BBC Block VPN connections.
It is useful to understand how PPP encapsulates high level protocol packets in order to transmit them. Basically it uses a framing method with a pre-defined framing method. The format includes placeholders for delimiters, addresses, controls, protocol and of course data. There is also a checksum included in the packet which is called a Frame Check Sequence.
The physical layer of PPP actually supports a range of transmissions including those over asynchronous and synchronous lines. These will also involve additional protocols such as EIA-232£ and CCITT V.24.
The data link layer of PPP takes it’s structure from HDLC (High Level Data Link Control. Using an additional link control protocol it will establish and manage links between endpoints. This protocol also establishes packet sizes and the methods of encapsulation. It can also manage authentication if required and things like compression methods which are often used in physical device connections.
Further Reading: Linking IP Address American Netflix, Faber Books.