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What is LAN? Understanding Local Area Networks

A computer network is a digital network that provides a central connection point for several computers and other computing devices. There are different types of computer networks, each of which may be classified according to the scale of their operations and purpose. One of the most common types of computer networks is LAN. But what is LAN?

In this blog post, we will explain LAN or local area networks. We will also look at how a LAN works, its characteristics, and the different types of LANs.

What is LAN?

LAN stands for local area network, which is a network of computers and other electronic devices that are all located in the same physical area.

LANs can be found almost everywhere, including homes, public workplaces, and public libraries. The purpose of LAN is to allow computers and other peripherals located in the same area to connect and exchange information with one another easily.

LAN can only be functional when devices are linked to a network that can either be wired or wireless. When we talk about wired networks, we use ethernet cables, and WIFI is utilized in the case of wireless networks.

History of LAN

The history of LAN can be traced back to the 1970s when Xerox PARC developed the first Ethernet standard. Ethernet uses coaxial cables to transmit data at 2.94 megabits per second (Mbps).

In 1980, the Institute of Electrical and Electronics Engineers (IEEE) standardized Ethernet as IEEE 802.3, which increased the data rate to 10 Mbps, and introduced twisted pair cables and hubs.

In 1985, IEEE 802.4 introduced token bus LAN and in the consecutive year 1986, IEEE 802.5 introduced token ring LAN.
In the late 1980s and early 1990s, LAN technologies such as FDDI, ATM, and Fast Ethernet emerged, offering higher data rates of 100 Mbps or more.

Year after year, advancements have been made to meet different organizations’ needs and provide better usability.
We now have a basic understanding of “What is LAN?” and its history. Now let’s discuss the working of LAN.

How Does Local Area Network Works?

We already have discussed that LANs are implemented either with the help of a wired network (cable) or wireless network (WIFI). When devices are connected with the help of a wired network, it is known as wired LAN. Also, when devices are connected with the help of a wireless network, it is known as wireless LANs.

Below we have explained how LAN works with the help of a diagram and the necessary components used in the working of LAN.
When two or more computers and different components of LAN within the same geographical area are connected to a network switch, it forms a LAN. An Ethernet cable is used to make this connection.

The network switch establishes a connection with a modem, which allows the delivery of internet connectivity.
Technology such as CSMA/CD guarantees that data is sent successfully through cable connections and that data packets are not in conflict with one another.

The network interface card (NIC) is a hardware device that connects a computer to a local area network (LAN). With the help of NIC, devices can share data packets over the LAN, following the protocols and standards of the network.

Local Area Networks are structured using switches and routers. The data packets are routed across the network with the help of the hardware that works as an interface and controls the connections between the various nodes.

Types of Local Area Network

Mainly There Are Two Types of LAN. These are:

Client/Server LANs

It comprises a network of clients that communicate with a single server. Files, printers, and other network activity are all controlled by the server. A client may be any device that can access and use software, such as a desktop computer, a tablet, or a smartphone. Clients may connect to the server through wired or wireless networks.

Peer-to-Peer LANs

A peer-to-peer LAN consists of devices that act as both clients and servers. The devices can directly communicate and share resources with each other without requiring a central server. For example, a computer may share files and printers with other computers on the same network in a home LAN. This type of LAN is mostly used in homes.

We already have explained the types of LANs; they can further be classified on the basis of topology. Let’s understand in detail.

Some of The Common Topologies Are:

Bus: A bus network is a type of arrangement in LAN in which a single cable connects all the devices on the network. The data is transmitted in both directions along the cable until it reaches the intended destination.

Star: A star topology consists of a central device (such as a switch) that connects all the other devices on the network. The data is transmitted from one device to the central device and then to another device.

Most of the time NIC card acts as an interface between the LAN cable and the PC in order to communicate with other available devices in a star topology.

Ring: A ring topology consists of a closed loop of cable connecting all the network devices. The data is transmitted in one direction along the loop until it reaches the intended destination.
One such example of ring-based topology LAN is IEEE 802.11 (IBM token ring) which generally operates at 4 and 16 Mbps.

Characteristics of LAN

LAN is relatively easy to set up compared to a Wide Area Network (WAN), which links computers and other network devices over a larger geographical region. In the case of LAN, all you require is a computer, its associated peripherals, and a wired or wireless connection.

Apart from the above-explained characteristics, some of the main characteristics of LANs are:

  1. High speed: LANs can offer fast data transfer rates ranging from 10 Mbps to 10 Gbps.
  2. Low Cost: LANs can be relatively inexpensive to set up and maintain, as they require less equipment and cabling than larger networks.
  3. High Security: LANs can be more secure than other networks, as they are confined within a limited area and can be protected by firewalls, encryption, and authentication methods. Since a LAN is a private network, it is ideal for usage in commercial and industrial settings due to its high level of security and dependability.
  4. High Reliability: LANs can be more reliable than other networks, as they have fewer points of failure and less interference from external factors.

Advantages of LAN (Local Area Network)

  1. LANs can provide very high data transfer rates, often reaching gigabit or even higher speeds.
  2. In LANs, the latency (time delay) in data transmission is minimal due to the short distances involved.
  3. Implementing a LAN is generally cost-effective, especially when compared to larger-scale networks like Wide Area Networks (WANs).
  4. Setting up a LAN is relatively straightforward, and the required infrastructure is readily available.
  5. LANs offer better control over security measures.
  6. One of the primary benefits of LANs is resource sharing. Users within the network can share common resources such as printers, scanners, storage devices, and internet connections.
  7. LANs can be easily expanded and upgraded to accommodate the growing needs of an organization.

Disadvantages of LAN (Local Area Network)

  1. The primary drawback of LANs is their limited coverage area.
  2. Implementing a LAN can be cost-effective in terms of infrastructure, but as the number of users increases, the cost per user can rise significantly.
  3. While LANs offer resource sharing as an advantage, they also suffer from a drawback in the sense that if a centralized server or network storage experiences a failure, it can severely impact all connected devices’ access to shared resources.
  4. In busy LAN environments with many devices transferring data simultaneously, network congestion can occur, leading to decreased data transfer speeds and potentially affecting real-time applications.
  5. In some LAN configurations, a single point of failure can disrupt the entire network’s functionality.


In this blog post, we have learned about “What is LAN”, working, characteristics, and types of LANs. LANs are computer networks connecting devices within a limited area, such as a building, office, or home.

Various characteristics such as high speed, high security, and better reliability make LANs one of the most used networks. Find the best LAN cabling services in Surat, offering at the latest price. Discover a wide range of networking cable from top manufacturers, dealers, and distributors across Surat.




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