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A network consists of two or more computers connected through some sort of medium, passing information among them over that medium. 'Medium' here is jargon; it refers to anything capable of acting as a data pipe. Various types of wires have long been used, and wire will always be the commonest network medium. Wi-Fi uses microwaves as its network medium. Infrared light can also act as a network medium, and Windows XP contains support for an infrared-based 'Personal Area Network' within a single room. Surprisingly, the type of medium used in a network doesn't matter much, and it can be changed very easily without much disruption. If you already have a wired network, you can 'swap out' wires for Wi-Fi and very little else changes.
Today's networks are 'packet-based.' Data moves over the network medium divided up into packets. A packet is just a smallish chunk of data with a destination address and a sender address. Every computer on a network has its own unique address. To send data to another computer on the network, a computer measures out a packet's worth of data, places its own address and the destination computer's address on the packet, and shoves the packet out onto the medium. The packet may pass by many other computers on the network (or all of them!) but only the computer to which the packet is addressed will grab the packet from the medium and read the data inside the packet. There may be more data to be sent than will fit in one packet, so the originating computer may simply repeat the process, measuring out data into packets, addressing them, and sending out the packets over the network one by one until all the data has been sent.
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