The two major components in a small computer network are a modem and wireless router. The modem is wired to the Internet via the cable company's coaxial cable, the telephone company's DSL phone line, Verizon's FiOS network or a satellite modem. The router is wired to the modem.
Modem - Establish and Convert
The modem establishes and maintains the connection with the Internet provider's service and converts the signals from and to the router appropriately.
Router - Route and Keep Track
The router forwards traffic to the modem that is destined for the Internet, while keeping internal traffic (computer to computer, computer to printer, etc.) inside the network. Using assigned numbers, the router keeps track of which computer made a request to the Internet in order to send responses back to that computer only. For details on the assignment process, see TCP/IP port
The Wireless Router
Rather than a stand-alone router, a wireless router is commonly used in the home and small business. The wireless router adds Ethernet switching and a Wi-Fi access point (see wireless router
Modem and Router in One Unit
This Xfinity gateway combines the cable modem and wireless router in one unit. See cable/DSL gateway