PPP is, of course, primarily used to provide data link layer connectivity to physical serial links. One of the biggest problems with serial links compared to many other types of layer one connections is that they are relatively slow. Consider that while 10 Mbps regular Ethernet is considered sluggish by modern LAN standards, it is actually much faster than most serial lines used for WAN connectivity, which can be 10, 100 or even 1000 times slower.

One way to improve performance over serial links is to use compression on the data sent over the line. Depending on the data transferred, this can double the performance compared to uncompressed transmissions, and can in some cases do even better than that. For this reason, many hardware devices include the ability to compress the data stream at the physical layer. The best example of this is probably the set of compression protocols used on analog modems.

Some physical links don't provide any compression capabilities, but could still benefit from it. To this end, an optional compression feature was created for PPP. It is implemented using two distinct protocol components:

• PPP Compression Control Protocol (CCP): This protocol is responsible for negotiating and managing the use of compression on a PPP link.
  
  
• PPP Compression Algorithms: A set of compression algorithms that perform the actual compression and decompression of data. Several of these are defined in Internet standards (RFCs). In addition, it is possible for two devices to negotiate the use of a proprietary compression method if they want to use one not defined by a public standard.