HDLC is the default encapsulation used by Cisco routers over synchronous serial links.  HDLC is a bit-oriented ISO standard Data Link layer protocol.  It specifies a method to encapsulate data over synchronous serial links using frame characters and checksums.  HDLC is a point-to-point protocol used on leased lines between Cisco devices.  If you need to establish a link between a Cisco device and a non Cisco device, you must use PPP encapsulation instead of HDLC.  No authentication can be used with HDLC.  The reason each vendor has a proprietary encapsulation of HDLC is that they each have a different way for the HDLC protocol to communicate with the Network layer protocols, and the ISO standard doesn't allow for multiple protocols on a single link.  They needed a way for HDLC to communicate with layer-3 protocols so HDLC can carry more than one type of protocol.

Example of Configuring HDLC Encapsulation

Although HDLC is the default encapsulation for serial interfaces, you might have to change it back to HDLC from another encapsulation method; to do that use the following commands:

   Router3#conf t
   Enter configuration commands, one per line.  End with CNTL/Z.
   Router3(config)#int s0
   Router3(config-if)#encapsulation ?

     atm-dxi      ATM-DXI encapsulation
     frame-relay  Frame Relay networks
     hdlc         Serial HDLC synchronous
     lapb         LAPB (X.25 Level 2)
     ppp          Point-to-Point protocol
     smds         Switched Megabit Data Service (SMDS)
     x25          X.25

   Router3(config-if)#encapsulation hdlc