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Elements of Networks of Network Economy

Basic elements of a computer network include hardware, software, and protocols. The
interrelationship of these basic elements constitutes the infrastructure of the network.

A network infrastructure is the topology in which the nodes of a local area network (LAN) or a
wide area network (WAN) are connected to each other. These connections involve equipment
like routers, switches, bridges and hubs using cables (copper, fiber, and so on) or wireless
technologies (Wi-Fi).

Network interface cards, commonly referred to as NICs, are used to connect a PC to a network.
The NIC provides a physical connection between the networking cable and the computer’s
internal bus. NICs come in three basic varieties: 8-bit, 16-bit, and 32-bit. The larger the number
of bits that can be transferred to the NIC, the faster the NIC can transfer data to the network

There are four elements that distinguish different types of networks from each other: speed, size,
connection methods, and data-sharing methods.

Network speed
One of the distinguishing features of a network is its speed: how much data per second the
network can transmit.
 Dialup networking (where a computer connects over an ordinary telephone line) is the slowest
form of networking in common use, with a maximum speed of 56K.
 Some networks' speeds depend on the number of simultaneous users in an area. Wireless
networking is usually much faster than dialup, but your wireless network access can slow down
when you're using an access point shared by many other users. In some cases, home cable
modem connections can also be slowed by high use in your neighborhood.
 Ethernet-based networking is the highest-speed form of networking in common use, with 100
MB speeds widely available and gigabit (1,000 MB) speeds being used more and more
frequently. Ethernet is also the foundation of the campus network. However, Ethernet is the least
widely available form of networking once you leave the campus area.
Rule of Thumb: Higher speed = higher price

Generally speaking, the faster a network is, the more expensive it is for home users to have
installed in their home.

Network size
Another defining characteristic of a network is its size, from "two computers and a cable" all the
way up to the Internet as a whole.

 A typical home network has two or more computers separated from the Internet by a router,
which directs internal network traffic and manages connections to and from your Internet service
provider. For a description of a typical home network's components, and how each element can
represent a section of a much larger network, see Parts of a Network.
 Sub networks within a larger network share many characteristics with a home network, since
they are separated from the rest of the network by some form of routing and make a distinction
between computers that belong to the subnet and computers that don't.

Sub networks usually include many more computers and printers than a home network, and may
contain computers from more than one building, but the basic architecture is the same. Access to
resources on computers in the sub network can be controlled based on whether a request comes
from another computer within the sub network, from elsewhere in the larger network, or from
elsewhere in the world.
The Internet is, as its name implies, the largest interconnected network on the planet. While
there are some private networks that do not share any connection with the Internet for security
purposes, most public and private networks (such as UIUC net) are connected to the Internet.

Connection methods
A network is also defined by the way that computers within it connect to each other. Some
networks require that connecting users use telephone lines; others use Ethernet or television
cables; others use only wireless connections; and some networks permit several types of
connection. For example, UUNet users can connect with telephone lines, Ethernet cable, or
wireless cards, but not with television cables. Each connection type has its own advantages and

 Telephone lines
56K Dialup: Although traditional 56K dialup is the slowest type of connection, nearly any
location will have a telephone line that you can use to connect. However, outside the local area
code, you may need to dial a more complex string of numbers in order to connect to your service
provider, and some hotels also require an extra string of numbers to dial an outside line.

High speed DSL/ISDN: Some high speed Internet connection options are also available through
telephone lines. You can have high-speed phone-based network access installed in your home or
apartment. Because DSL and ISDN require reliable phone lines of a certain length, however, you
can't typically use your DSL or ISDN modem from a hotel room on the road.
 Ethernet
Ethernet is the fastest type of wired connection in common use. Many offices use Ethernet
networking, and nearly any computer built within the last few years has an Ethernet port built in.
However, few hotels and coffeehouses will offer Ethernet connections to travelers, and very few
apartments and houses can be conveniently and inexpensively wired for Ethernet.
 Television cable (cable modem)
Your television cable is a convenient way to get high-speed network access at a house or
apartment, since most houses and apartments are easily connected to the existing cable network.
However, most offices are not wired for television cables, and most computers don't have a
television cable connection built into them for connection while traveling; a typical computer
will use its Ethernet or USB port to connect to a cable modem, which attaches to the television
cable network. Therefore, cable modems are most commonly used in homes, and rarely if ever in
hotels or offices.
 Wireless
Wireless networks offer speed and convenience at the cost of lower security and variable access.
Many hotels, coffeehouses, bookstores, and libraries offer wireless access to their patrons, and
some cities are designing citywide wireless access. On the other hand, a wired connection is
almost always more secure than a wireless connection; any wireless network user connecting to
the same access point can "overhear" what your computer is communicating, which makes the
use of strong encryption essential. In addition, the number of users connecting to a wireless
access point can make a noticeable difference in your connection speed. For more information
about wireless security and speed, see VPN for Wireless Users and Wireless

Data and file sharing

The last defining characteristic of a network is how computers exchange data with each other. There are
three main types of file sharing; a network can use just one file sharing method or any combination of the

 System-native file sharing

This type of file sharing is built into your operating system, originally intended for sharing files
(and often printers) with other users in your local network, and not intended for sharing files
with others across the Internet. The Microsoft Windows Network Neighborhood and Macintosh
AppleTalk are the two most frequently used examples of this model.
 Client-server file sharing
Ths model covers web pages, email, FTP, and other types of file sharing where the data is stored
in a central location (the server) and sent separately to each user who requests it (the clients).
This model is the most commonly used type of file sharing on the Internet.
 Peer-to-peer file sharing
Peer-to-peer file sharing doesn't rely on a single central server. Any two users (the clients in the
above model) can exchange data with each other directly, rather than having one user upload
files to the server and the second user download files from the server.
Rule of thumb: As controls go down, security problems go up. If you choose to run file
sharing methods on your computer, take these security precautions first.

Business communication is used to relay information within the business and promote services,
products or organizations, as well as deal with legal and other similar issues. It covers several
topics including branding, marketing, advertising, customer relations, public relations and
consumer behaviour, among others.

Information System functions to deal with Business Risk

An information system and MIS (IS) - or application landscape is any combination of

information technology and people's activities that support operations, management and decision
making. In a very broad sense, the term information system is frequently used to refer to the
interaction between people, processes, data and technology. In this sense, the term is used to
refer not only to the information and communication technology (ICT) that an organization uses,
but also to the way in which people interact with this technology in support of business

Some make a clear distinction between information systems, computer systems, and business
processes. Information systems typically include an ICT component but are not purely concerned
with ICT, focusing in instead, on the end use of information technology. Information systems are
also different from business processes. Information systems help to control the performance of
business processes.

An Information System (IS) is the system of persons, data records and activities that process the
data and information in a given organization, including manual processes or automated
processes. Usually the term is used erroneously as a synonym for computer-based information
systems, which is only the Information technologies component of an Information System. The
computer-based information systems are the field of study for Information technologies (IT);
however these should hardly be treated apart from the bigger Information System that they are
always involved in.
The focus of Info Systems is on the development of solutions for business problems rather than
simply describing them.

Information systems strongly focus on explaining empirical phenomena of the real world. IS has
often been called an "explanation-oriented" approach in contrast to the "solution-oriented" BI
approach. IS researchers try to explain why things in the real world are the way they are and
conduct a lot of empirical surveys whereas a BI researcher tries to develop IT solutions for
problems they have observed or assumed. Academics in BI, for example, are often fond of
applying new technologies to business problems and doing feasibility studies by building
software prototypes. BI students are also taught this constructive approach. Their ability to not
only explain reality, but rather shape it, is what makes them very attractive employees for
companies as well as good candidates for entrepreneurs in the business IT field.

Infrastructure of Networked Economy

Depending on which historian you talk to, it started with the invention of copper or fiber optic
cables, or even with the invention of the railroad. Some even argue that communication and
information distribution changes began when monks started transcribing religious texts and
passing them down for future generations. Whatever your historical interpretation, the current
phase of the networked economy is transforming the way we maintain friendships, the way we
work and the way we live. The information traveling over the expressways of wireless, copper
and fiber optic cable touches every part of life and business.

The Networked Economy

The networked economy has been defined as one where relationships of production, power and
experience change as networks play a larger role in labor patterns, politics, power structures,
education and commerce. In the United States, the numbers tell the story. The networked
economy has driven GDP growth to about four percent to five percent, compared to a two
percent to three percent rate 50 years ago.

Companies in this market compete based on their ability to process electronic information.
Economic activities are restructured based on advanced information technology. The Internet, a
central part of this networked economy, increases productivity and changes the way goods are
bought, sold and distributed, because it eliminates much of time and space. Not only does e-
commerce change how we buy, it changes customers and what they buy. For example, the first
transaction of, an Atlanta, Ga.-based electronic marketplace, involved
a Ugandan company that sold $60,000 worth of perch to a fish processing plant in Columbia.

The computing and networking technology of the 70s and the 80s was used mainly to make
companies more productive. In the 90s businesses and consumers began to use the Internet for
communication and for distribution of information about companies, products, etc. Now people
are not only communicating over the Internet, but are buying and selling goods and services with
increasing comfort. This means MIS departments no longer just keep the network running; they
now find themselves in the middle of sales and marketing decisions. That is a dramatic change.

The importance of information management in business is resulting in huge investments in

technology. Businesses need smarter networks, computers, and software. As e-commerce
becomes increasingly mainstream, a larger portion of information management budgets will be
dedicated to network technologies and that 50 cents will migrate to the networks, as they will be
seen as important as brick and mortar in capital improvement budgets as consumers demand
more information, faster delivery and more responsive service.

Networks, now playing a very different role in the marketplace, are becoming relevant to
companies and all consumers. Businesses are compelled to keep abreast of the times, to
communicate over the network and reach out to their business partners and customers. So the
amount of resources – technology and talent – companies are putting into their operations is
growing tremendously.

1. Hardware

2. Software
3. Sharing information and resources through networks
 Wireless Networks

Fiber Optic Networks

Fiber optic networks are the backbone of the new economy, acting like the freeways and
railroads of the past, transferring the essential commodity, information. At first they were built
with SONET or SDH technology in rings, which is a more rudimentary, inflexible technology.
But as data and Internet traffic increased, the networks had to transform from a static to a more
intelligent, flexible technology.

For example, if an Internet service provider today needs a 2.5 gigabit per second connection
between Las Vegas and Los Angeles for a month, even in the United States after government
deregulation, a carrier who sells the connection will likely insist on a longer-term commitment
and charge $200,000 a month. This market for bandwidth is very much like buying computing
time on a mainframe 15 years ago. Data traffic, not voice traffic, is now driving the growth of the
worldwide networks. And the demands of e-commerce, e-mail, and data networking are forcing
fiber optic networks to move from relatively static infrastructures to networks that can quickly
meet the demands of data traffic. And all of this will be transparent to the end user.

Intelligent Networks
What intelligent optical networking does is make access to bandwidth very, very simple. If you
want a connection from Mumbai to Calcutta, then you put a card in the network in Mumbai,
shoot the laser beam through the fiber, and just pick it up in Calcutta. The connection is up and
running. This cuts down the provisioning time from months to days and allows the carrier to
invest technology and capital in the parts of the networks where there is demand.

In the past, people would lay the fiber in the ground and cut a billion-dollar purchase order to a
big telecommunications company. Those companies took four or five years to build the network,
most often based on inflexible SONET or SDH technology, and they depreciated the cost over 20
years. At the time, when it was just voice traveling over the networks, that was fine. But the
greater demand for bandwidth has required network architecture to evolve. Carriers found a need
to economically add bandwidth where they needed it, when they needed it.

As carriers install optical switches in cities, the connections will become direct and flexible.
With optical switches in place, a laser beam starting in Mumbai could stop in Nagpur on its way
to Calcutta. This gives the customer a powerful, versatile connection and carriers are able to
make better use of their installed fiber. Intelligent optical switches are fast enough to recover
from failures. A sudden failure in the connection between Mumbai and Calcutta could be
rerouted to Andhra Pradesh then to Calcutta. The intelligent optical networks of the future
require the technology to shoot the laser beams, to put the information on the laser beams, the
ability to switch the traffic, and then the software to provision the bandwidth the way it’s needed,
when it’s needed and for just as long as it’s needed.

With more powerful networks will come a more powerful Internet? Consumers and businesses
will have new ways to use the Internet — such as streaming movies, live video, virtual
environments, distributed computing, storage area networking and many services not yet
imagined. And this is going to happen globally because fiber optic cables do not stop at national
borders. Information flows unconstrained by boundaries or distance. The global economy
implies networked economy.