A Local Area Network is primarily a data communication system intended to link computers and associated devices within a restricted geographical area of sharing of information and resources.

The key feature of local area network is that the entire network is confided in one place and remains completely under the control of one organisation.

Implementing a local area network does not prevent the communication with other systems and other networks.

The communication with other systems and other networks can be achieved by connecting one LAN with other remotely located LAN with the help of special bridging equipments like bridges, routers and gateways.

Main Characteristics of LANs are:

§  Inexpensive way of data communication.

§  Easy to set up network.

§  High data transmission rate.

§  Network data transmission speed is independent of speed of attached devices.

§  Easy to control and maintain the network.

Benefits of LANs:

§  LANs allow distributed data processing.

§  LANs allow the extended use of PCs by connecting them to powerful servers.

§  Sharing of data and resources; precious resources like colour laser printers, costly applications, etc can be polled among different users.

§  Effective data and devices management, and their utilization.

§  Lower data preparation and personnel cost because every data is required to be entered once only, and data is automatically reflected at required places.

§  Lower software cost because there is no need to buy the single user license for every user; a low cost multi user’s license serves every user in the organization.

Components of LAN:

§  Computer and devices (One computer normally acts as a File Server or Server and others acts as a workstation)

§  Cables (Communication Channels)

§  Network Interface Card (NIC) (Communication devices)

§  Network Operating System (Communication Software)

File Server or Server:

§  Server is a computer which is used for managing the files and devices of a network.

§  Server also helps in handling network communication and servicing the various requests of users for information sharing on a network.

§  Server can be dedicated or non-dedicated.

§  In dedicated server, all the network management functions are done by server.

§  In non-dedicated server, some of the management functions are transferred to workstation.


§  Workstations are standalone computers which act as nodes in the network and attached to server using network interface card.

§  Workstations are normally personal computers with their own processing power and because these are connected on network therefore use the extra processing power and capabilities of server that makes them more capable than standalone personal computers.

§  Generally a workstation is defined as: LAN Card + PC = Workstation


§  Cable is used for connecting computers and devices on network.

§  Cable is communication channel of network on which data communication takes place.

§  The Examples of cables are: UTP,Coaxial Cable and Optical Fibber Cable.

UTP or STP Cables:

§  This is the most popular type of cable for creating LAN.

§  This cable is used with HUB or SWITCHE to build a LAN.

§  It is like a telephone receiver cable.

§  It provides speed of transmission normally from 10 Mbps to 100 Mbps.

Coaxial Cables:

§  This was the most popular type of cable for setting up a LAN before the popularity of UTP cable.

§  It is like a TV cable and provides data transmission speed of approximately 10 Mbps.

Fiber Optical Cables:

§  This was the latest cable technology and used for building high speed LAN, known as Giga Bits LAN.

§  This type of cable provides the highest data transmission speed.

Network Interface Card:

§  Every device connected to a LAN needs a communication device known as Network Interface Card.

§  NIC is used in every PC connected in network mode.

§  NIC uses various rules and regulations that protocol for smooth and error free communication of data.

Network Operating System:

§  This is the software which is loaded onto the server hard disk.

§  The job of this software is to manage and control the working of network.

§  It is, in fact, NOS which helps to make a computer as as server on a network.

§  The NOS helps in file management, security management, applications management, user’s management, processing management and devices management functions of a Network.


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