10.3
Optimizing Traffic Flow with Data Compression
10.3.4 TCP/IP header compression
The TCP header compression subscribes to the Van Jacobson Algorithm, which is defined in RFC 1144. TCP/IP header compression lowers the overhead generated by the disproportionately large TCP/IP headers as they are transmitted across the WAN.

TCP/IP header compression is protocol specific and compresses only the TCP/IP header, which leaves the Layer 2 header intact to allow a packet with a compressed TCP/IP header to travel across a WAN link.

It is beneficial on small packets with few bytes of data, such as Telnet. Cisco header compression supports X.25, Frame Relay, and dial-on-demand WAN link protocols.

Because of processing overhead, header compression is generally used at lower speeds, such as 64-Kbps links.