Life without the internet is hard to conceive in today’s time and age as it has become a ubiquitous part of our everyday life. We often take our home internet network for granted which consists of crucial hardware components. Many individuals find it overwhelming to comprehend these components, notably the Modem and the Router, leaving it for their “tech-savvy” counterparts.

However, familiarizing yourself with hardware components like the router and modem is necessary for understanding how modern WiFi works. It can help you solve connectivity issues and upgrade your network when necessary. Moreover, you can also save money by understanding the difference between these devices, which can help you buy your equipment and skip the carrier’s equipment rental fee.

Modems vs. Routers

We can summarize the main differences between a modem and a router:

A modem connects your devices to the internet or Wide Area Network (WAN).A router connects your devices to the modem and creates a Local Area Network (LAN) around your house.
A modem translates the signals received from your ISP for your devices.A router uses built-in antennas to connect your devices to the modem.

What is a Modem?

The internet is a massive collection of computer networks that facilitates global communication and access to information. Although smartphones can access the internet via a wireless network, non-cellular devices like gaming consoles, computers, and smart home gadgets need a modem to access the internet.

A modem or a modulator and demodulator acts as a translator for your home network. Simply speaking, it transforms your outgoing data into analog signals that can transmit over wires and translates incoming analog signals into digital data.

Most standalone modems come with only two ports: one for connecting to the web and an Ethernet Jack for connecting to a computer or router. People only used a modem to go online in the early days of the internet. Nowadays, most ISPs offer a modem with their service and charge an equipment rental fee. While cable internet users have the freedom to buy their modems, most DSL or fiber internet providers limit your choices.

What is a Router?

A router connects your other devices to a modem. The primary responsibility of this networking device is to route your internet connection from your modem to the other devices on the network. This allows you to access the internet from your computer, smart TV, mobile phone, and other wired or wireless devices.

The primary purpose of a router is to efficiently distribute the signals to the appropriate device on the network. It assigns IP addresses to all the gadgets to handle the connection between them. A router helps you create a home network and lets you manage its settings. You can prioritize specific devices or enable security settings with this device. It also allows your devices to communicate with each other.

There are both wired and wireless types of routers. While wired routers require an Ethernet cable to connect to other devices, wireless routers use built-in antennas to transmit the signals. Your modem usually connects to your router’s Wide Area Network (WAN) port. You can easily find many powerful routers on the market depending on your home size and the number of devices.

Modem vs. Router: Which is More Important?

Technically a modem is more important than a router because it connects you to the internet. However, it only provides a connection to a single wired device. You will need a router for multiple devices. The router has become significant as more customers shift towards handheld devices. Moreover, a router also provides security to your devices. With that said, you don’t need to get separate devices while setting up your connection. Instead, you can buy a gateway.

What is a Gateway?

A gateway is a combination of a modem and router that simplifies that helps you save space. It has become a familiar sight instead of separate modems or routers. Many internet service providers offer gateways for rent or purchase with their service.

Should You Buy or Rent These Devices?

Many ISPs include equipment with their service and charge monthly equipment rental fees. While there are many benefits to renting these devices, investing in your equipment can help you save money. This decision highly depends on Here are a few advantages and drawbacks of buying or renting a modem and a router.

Renting a Modem and a Router

If you live in sharing or have a large family, network bandwidth and accessibility can be your main concerns. Although upgrading your internet plan is preferable, a second internet provider is the next best option if you want a separate network for your activities.


  • Regular repair and software updates
  • Compatibility with the provider
  • Technical support


  • Monthly rental fee

Buying a Modem and a Router


  • One-time investment
  • Decreased internet bill
  • You can opt for better equipment


  • Upfront cost
  • Repair, updates, and technical support are dependent on your warranty.

Final Words

Router and modems are both necessary components for your home network. Although there is no shame in letting the technicians and tech-savvy people handle this equipment for you, knowing their functionality and learning how they work can help you save money and invest in better options. Therefore we have highlighted the main differences between these devices to let you wrap your head around the basics.