In windows 7, when you try to connect using your PPPoE connections, you may be faced with the following error:
Error 651: The Modem (or other connecting device) has reported an error.
These connections would work just fine with Windows XP or Windows Vista PCs.
Again, you are not alone, this seems to be a known bug in Windows 7 that is being worked at. However, you can workaround this problem.
The RAS PPPoE driver file “raspppoe.sys” found under c:windowssystem32drivers folder seems to be the root cause of the problem. Fortunately, we can workaround the problem simply by renaming the original raspppoe.sys file to something like “raspppoe_orig.sys” copying a working file from a Windows Vista system. If you do not have access to a Windows Vista system. click here to download raspppoe.sys file (unzip).
This should help!