What is PPPoE?
PPPoE (Point-to-Point Protocol over Ethernet) is a network protocol which is derived from an older protocol called PPP (Point-to-Point Protocol).
PPPoE is designed to control how data is transmitted over Ethernet (wired) networks and enables a single server connection to be shared between multiple clients. This enables several clients from an ISP (Internet Service Provider) to connect to the same server and access the Internet at the same time.
To keep things simple, PPPoE is a modern version of the old dial-up connection which was popular in the 80s and 90s. PPPoE also offers important network functions such as authentication, encryption, and data compression.
PPP not only verified authorization, but also determined the amount of data transferred along with the dial-in time. It proved to be very effective for Internet Service Providers since customers at that time paid per-minute for Internet usage. With DSL connections, more than one device is often online at the same time which is why there was a need for a new protocol. PPPoE offers the same advantages as PPP, with the exception that it runs over Ethernet.