TCP is stream oriented meaning data is transferred as a continues stream of bytes. But what confuses me is that TCP creates segments and passes this down to IP. IP creates packets encapsulates segments and transfers them. So where exactly the continuous stream here?
UDP on the other hand is message oriented. It receives messages from application layer, creates datagrams and pushes it down to IP. So far it is the same as TCP, instead a datagram created and pushed down. What makes this protocol a message oriented?
Answer
The interface/API presented to you the user(programmer) of these protocols are:
UDP
Message oriented, you have an API (send/recv and similar) that provide you with the ability to send one datagram, and receive one datagram. 1 send() call results in 1 datagram sent, and 1 recv() call will recieve exactly 1 datagram.
TCP
Stream oriented, you have an API (send/recv and similar) that gives you the ability to send or receive a byte stream. There is no preservation of message boundaries, TCP can bundle up data from many send() calls into one segment, or it could break down data from one send() call into many segments - but that's transparent to applications sitting on top of TCP, and recv() just gives you back data, with no relation to how many send() calls produced the data you get back.