The High-Level Data-Link Control (HDLC) protocol is a popular ISOstandard, bit-oriented Data Link layer protocol.

It specifies an encapsulation method for data on synchronous serial data

links using frame characters and checksums.
HDLC is a point-to-point protocol used on leased lines. No authentication can
be used with HDLC.
HDLC is the default encapsulation used by Cisco routers over synchronous
serial links.
Ciscos HDLC is proprietaryit wont communicate with any other vendors
HDLC implementation.
Each vendor has a different way for the HDLC protocol to encapsulate
multiple Network layer protocols.

Cisco HDLC frame format

 Point-to-Point Protocol (PPP) is a Data Link layer protocol

that can be used over either asynchronous serial (dial-up) or
synchronous serial (ISDN) media.
It uses the LCP (Link Control Protocol) to build and
maintain data-link connections.
Network Control Protocol (NCP) is used to allow multiple
Network layer protocols (routed protocols) to be used on a
point-to-point connection.
The basic purpose of PPP is to transport layer 3 packets
across a Data Link layer point-to-point link.

PPP contains four main components:

EIA/TIA-232-C, V.24, V.35, and ISDN - A Physical layer international
standard for serial communication.
HDLC - A method for encapsulating datagrams over serial links.
LCP - A method of establishing, configuring, maintaining, and
terminating the point-to-point connection.
NCP - A method of establishing and configuring different Network
layer protocols. NCP is designed to allow the simultaneous use of
multiple Network layer protocols. Some examples of protocols here are
IPCP (Internet Protocol Control Protocol) and IPXCP (Internetwork
Packet Exchange Control Protocol).

Protocol stack compared to the OSI reference model

Point-to-Point Protocol stack

It is important to understand that the PPP protocol stack is specified at the Physical
and Data Link layers only.
NCP is used to allow communication of multiple Network layer protocols by
encapsulating the protocols across a PPP data link.

Authentication This option tells the calling side of the link to send information
that can identify the user. The two methods are PAP and CHAP.
Compression This is used to increase the throughput of PPP connections by
compressing the data or payload prior to transmission. PPP decompresses the
data frame on the receiving end.
Error detection PPP uses Quality and Magic Number options to ensure a
reliable, loop-free data link.
Multilink Starting in IOS version 11.1, multilink is supported on PPP links with
Cisco routers. This option allows several separate physical paths to appear to
be one logical path at layer 3. For example, two T1s running multilink PPP
would appear as a single 3Mbps path to a layer 3 routing protocol.
PPP callback PPP can be configured to call back after successful
authentication. With callback enabled, a calling router (client)
will contact a remote router (server) and authenticate as described in the
previous section. Both routers must be configured for the callback feature.
Once authentication is completed, the remote router will terminate the
connection and then re-initiate a connection to the calling router from the
remote router.

When PPP connections are started, the links go through three phases of
session establishment.

Link-establishment phase LCP packets are sent by each PPP device to

configure and test the link. These packets contain a field called the
Configuration Option that allows each device to see the size of the data,
compression, and authentication. If no Configuration Option field is
present, then the default configurations are used.
Authentication phase If required, either CHAP or PAP can be used to
authenticate a link. Authentication takes place before Network layer protocol
information is read. It is possible that link-quality determination may occur at
this same time.
Network layer protocol phase PPP uses the Network Control Protocol
(NCP) to allow multiple Network layer protocols to be encapsulated and sent
over a PPP data link. Each Network layer protocol (e.g., IP, IPX, AppleTalk,
which are routed protocols) establishes a service with NCP.

There are two methods of authentication that can be used with PPP links:
Password Authentication Protocol (PAP) The Password Authentication
Protocol (PAP) is the less secure of the two methods. Passwords are sent in
clear text, and PAP is only performed upon the initial link establishment. When
the PPP link is first established, the remote node sends back to the originating
router the username and password until authentication is acknowledged.

Challenge Handshake Authentication Protocol (CHAP) The Challenge Handshake

Authentication Protocol (CHAP) is used at the initial startup of a link and at periodic
checkups on the link to make sure the router is still communicating with the same host.
After PPP finishes its initial link-establishment phase, the local router sends a challenge
request to the remote device. The remote device sends a value calculated using a oneway hash function called MD5. The local router checks this hash value to make sure it
matches. If the values dont match, the link is immediately terminated.