Diagnosis: pppd has failed to change the pty over to run
it in PPP mode. This may be because you have no ppp_async
module built for your kernel. Most kernels are built with this
already, but if you have customised your kernel you may not have built
it.

Solution: rebuild your kernel with CONFIG_PPP_ASYNC set. While
you are at it, you should set CONFIG_PPP as well, and both should be
set to "m" so that they are built as modules. We've found they don't
work compiled statically.