Layer 2 Tunnel Protocol

The Layer 2 Tunnel Protocol (L2TP) is an emerging Internet Engineering Task Force (IETF)
standard that combines the best features of two existing tunneling protocols: Cisco’s Layer 2
Forwarding (L2F) and Microsoft’s Point-to-Point Tunneling Protocol (PPTP). L2TP is an extension
to the Point-to-Point Protocol (PPP), which is an important component for VPNs. VPNs allow users
and telecommuters to connect to their corporate intranets or extranets. VPNs are cost-effective
because users can connect to the Internet locally and tunnel back to connect to corporate resources.
This not only reduces overhead costs associated with traditional remote access methods, but also
improves flexibility and scalability.
Traditional dial-up networking services only support registered IP addresses, which limits the types
of applications that are implemented over VPNs. L2TP supports multiple protocols and unregistered
and privately administered IP addresses over the Internet. This allows the existing access
infastructure, such as the Internet, modems, access servers, and ISDN terminal adapters (TAs), to be
used. It also allows enterprise customers to outsource dialout support, thus reducing overhead for
hardware maintenance costs and 800 number fees, and allows them to concentrate corporate gateway
resources. Figure 1 shows the L2TP architecture in a typical dial up environment.