A home network is a type of local area network (LAN), a group of computers and other devices in close proximity to each other that are connected, so they can share information and resources. Home networks often link desktop computers, laptops, printers, DSL or cable modems, video game systems, and digital video recorders. A home network is all about sharing. It can allow you to exchange files without floppy disks, print from any computer to a single printer, play multi-user video games, and share one broadband Internet connection.

A typical LAN is made up of three parts: nodes, a connecting medium, and specialized networking equipment. Any device connected to the network, like a computer or printer, is called a node. A LAN can have as few as two nodes or as many as thousands of nodes. Nodes can be connected either with cables or wirelessly. Specialized networking equipment, like routers and network interface cards, helps link the nodes together and facilitate the exchange of information between them.

Common methods of home networking: Ethernet, wireless, phone line, and power line.

Ethernet commonly operates at two speeds, measured in megabits per second (Mbps):

• 10 Mbps, also know as Standard Ethernet or 10BaseT
• 100 Mbps, also known as Fast Ethernet or 100Base T

Gigabit Ethernet is a new, faster Ethernet technology, but not as widely used as Standard and Fast Ethernet. At 1000 Mbps, it's lightning fast, but also more expensive.

Ethernet Equipment

Each computer in an Ethernet network needs a network interface card (NIC) so it can talk to the other devices on the network. Network interface cards are also sometimes called Ethernet cards, network cards, or network adapters. The good news is that most newer computers already have an Ethernet card installed. If not, you need to purchase an Ethernet card for every computer you want to add to the network.

Ethernet cables are used to connect all of the nodes on an Ethernet network. The most common type of cable is called Cat 5 (short for category 5), an unshielded twisted-pair cable. Cat 5 looks like ordinary telephone wire, but with 8 wires inside instead of 4 and a larger wall plug-in called an RJ-45 connector.

All of the devices on an Ethernet network need a common place where they connect. There are three kinds of equipment that do the job:

Hub
A hub is like the hub of a wheel, a central box that all of the devices on the network plug into. A hub allows any two devices on the network to communicate with each other.

Switch
A switch is like a hub, except it not only connects devices, but directs the flow of information between them as well. A switch allows for faster communication when many people are using the network at the same time.

Router
A router is a type of switch that also connects to your DSL/cable modem, allowing many people to access the Internet on different computers at the same time. It acts as a sort of gateway between the Internet and all of the computers on your home network.

There are two main things to consider when you're deciding whether to go with a hub, switch, or router: (1) how many devices you want to network, and (2) if you want to share a single Internet connection. If you want multiple computers to share one broadband Internet connection, then a router is the best choice. Otherwise a hub or switch will work just fine. As a rough rule of thumb, use a switch if you are connecting more than four computers. Less than four, and a hub is okay.

No matter what you choose, pay attention to the number of ports it has, because the number of ports tells you how many devices you can connect to it. For example, a four-port hub can connect four devices.

Here's an example of how a typical Ethernet home network might be set up.

Say you have three computers that you want to network, one of which has a printer attached. Plus you have a broadband Internet connection you want to be able to use at all of the computers simultaneously.

And that's it! With a setup like this, you can swap files between the computers, surf the Internet on all of the computers at the same time, and print from any computer to the printer.

Ethernet Pros & Cons

Because all of the nodes are connected via cables, Ethernet is the fastest and most stable of the home networking options. But cables can also be a limitation. If your home is not pre-wired for Ethernet and your computers are far apart, running cables between rooms can be unsightly and installing wiring and jacks can get expensive.

 

Power Line Equipment

You need three things to set up a power line network in your home.

First, to talk to the other devices on the power line network, each computer needs an Ethernet card, like the kind you'd install in your computer if you were setting up an Ethernet network.

Second, for each device you're networking, you need a power line Ethernet adapter, a small device that plugs into your wall outlet. It uses a type of technology called PowerPacket to send data over your electrical lines. PowerPacket technology separates the available range of frequencies on your power lines into different carriers, like the lanes of a highway, which can then be used to transfer information. The PowerPacket technology can also sense noise on the line or surges in power use and redirect the flow of data, avoiding disruption to your network.

Finally, you need some Cat 5 Ethernet cable to connect your computer to the power line adapter. This is the same kind of cable you'd use in an Ethernet network, only you won't need as much of it since your existing electrical wiring will be doing most of the work.

Power Line Pros & Cons

In the same way a HomePNA network uses your phone lines to connect your computers, a power line network uses your electrical wiring, so no new cabling is required. And it may be even more convenient than a phone line network, because there are more electrical outlets in the average home than phone jacks. At 14 Mbps it is faster than HomePNA, but still slower than Fast Ethernet, and for mobility, it can't compete with wireless networking.

 

Wi-Fi (short for Wireless Fidelity) is an industry name used to market wireless networking products that adhere to communication standards set by the Institute of Electrical and Electronics Engineers (IEEE). There are three common Wi-Fi standards currently available:

802.11b was the first standard to be used in wireless networking and is the most popular. It is what most
people mean when they say "Wi-Fi." 802.11b operates at a speed of 11 Mbps and on a frequency of
2.4 GHz (gigahertz). Many other household electronics, such as cordless phones, microwaves, and
garage door openers, also operate at 2.4 GHz, which can sometimes cause interference.

802.11a operates at a speed of 54 Mbps and on a frequency of 5 GHz. It is faster than 802.11b and
because it operates at a regulated frequency, interference with household electronics is not a problem.
However, 802.11a is a newer technology and more expensive.

802.11g is a cross between 802.11b and 802.11a. Operating at 54 Mbps, it's as fast as 802.11a, but
like 802.11b, it operates at the lower 2.4 GHz frequency. Cost-wise, it's in between as well.

Keep in mind that all three 802.11 wireless standards are not universally compatible. 802.11b and 802.11g work with each other, but 802.11a is incompatible with both 802.11b and 802.11g.

Wireless Equipment

Each computer in a wireless network requires a wireless adapter so it can talk to the other devices on the network. Wireless adapters are also sometimes called wireless Ethernet cards, WLAN cards, or wireless network interface cards (wireless NIC). A wireless adapter contains a transceiver, a combination transmitter/receiver that sends and receives information between your computer and the network.

In most wireless network setups, you also need a central device to manage the data flow on the network. This device is called a base station, and there are three main types:

Access Point
An access point is like a wireless hub. It's a central communication point for all of the wireless devices on the network. An access point does not allow you to share a common Internet connection, however. For that, you need a router.

Router
A router is an access point that also connects to your DSL/cable modem, allowing Internet access on any networked computer from a single broadband connection.

Gateway
A gateway is an all-in-one device that's basically a router with the DSL/cable modem built in.

Wireless Pros & Cons

A wireless home network is very convenient, because it can connect computers in different rooms or on different floors without using cables. It's also great for mobility. You can take a wireless-enabled laptop anywhere in the house and still have access to the network. But convenience comes with a price. Wireless networks are more expensive than Ethernet. They are also slower and subject to interference from both physical objects and home electronics that operate on radio frequencies.

 

Think of it this way. In a HomePNA network, the phone lines in your house do the same job the cables do in an Ethernet network. And the good news is that even though it uses your phone lines, HomePNA does not interfere with the normal operation of your telephones or your DSL. HomePNA, DSL, and voice data all travel through the phone lines at the same time, but on different channels, so they never interfere with each other.

Search Internet for current versions of HomePNA technology: http://download.cnet.com/topics/homepna 

Phone Line Equipment

As with other types of home networks, every device in a HomePNA network needs a way to talk to the other networked devices. In a HomePNA network, this device is called an HPNA network adapter, and it's available in two types:

PCI adapter
A PCI adapter is a card you install internally in your computer.

USB adapter
A USB adapter plugs into an external USB port on your computer.

A PCI adapter is less expensive than a USB adapter and will give you slightly better performance, but requires you to open your computer to install it. A USB adapter is more convenient because you just plug it in externally, but gives you slightly less performance.

All-in-one HomePNA kits, e.g.: http://na.tm.agilent.com/pna/kits.htm  are also available, which include HPNA adapters, telephone wires, and software - everything you need to set up your HomePNA network.

Phone Line Pros & Cons

The obvious advantage of a HomePNA network is its convenience. Since your phone lines do double-duty as network lines, no new cabling is required, saving you time and money. Still, it is a wired network and doesn't give you the mobility that wireless would. Also, at 10Mbps, HomePNA is slower than some other Ethernet and wireless options."

some source: vonage.com