Cable Modems vs. Routers: Understanding the Difference

Looking over your WiFi options can be an overwhelming experience: What exactly is a wireless gateway? Is 2.2 Gbps considered fast? Wait a second…. I need a router and a cable modem? What’s the difference?!  

For something that makes life so much easier when it’s working correctly, WiFi sure can be complicated. We get it, and we’re here to help by going back to the basics. First and foremost, it’s important to know that your home internet connection starts with two fundamental devices: a cable modem and a router.   

Modems: The Link Between the Internet and Your Home  

Think of a cable modem as the door between your home and the world wide web.  

The word “modem” is actually short for “modulator demodulator,” which tells us a bit more about the role of this device: to modulate signals in order to transmit information. Your cable modem essentially works as a translator, converting the signals from your Internet Service Provider into signals that your devices can understand. In other words, it is responsible for sending and receiving all of the data that passes between your personal network and your Internet Service Provider.   

Modems Are Not One Size Fits All

The type of internet you receive actually plays an important role in which type of modem you need. Perhaps you have a standard cable provider, fiber optics, a satellite dish, or DSL. If you rely on fiber optics, for example, your modem is specifically designed to transmit fiber-optic light signals from an optical network terminal (ONT) straight to your devices. The Verizon Fios box where the fiber enters your house, is an example of an ONT device. 

How Does it all Work? 

The connection between the internet and your home is known as a wide area network (WAN). By plugging either a cable (for cable or fiber optics internet) or phone line (for DSL) into the port found on the back of your modem, you spark this initial connection. 

Then, the outside signals are sent to each individual device in your home (like a computer or router) via an Ethernet cable or WiFi. Once your modem is connected to the devices in your home, it will control the flow of your information by converting the signal from your ISP into a universal one that your computer and devices can understand.  

Buying a Cable Modem 

In most cases, your internet service provider will give you a modem when they set up your service. This wasn’t a gift, but a rental: you’re most likely paying a monthly fee (usually somewhere around $15) for your modem. To avoid these fees, many people decide that they want to own their own modems instead of renting one.  You could save up to $540 in three years but switching to a cable modem.  

Picking a modem is only half the battle, however, especially if you are looking to connect more than just a single, wired device to the internet. If you want to hook up multiple devices, or go wireless, you will need a router. 

Routers: The Hub for Your Devices  

While modems connect your home to the wide area network (WAN), routers connect all of your devices to a local area network (LAN) that it creates within your home. This allows for multiple devices to use your network simultaneously, while also making it possible for different devices to communicate with one another, share files, etc. In other words, these devices route internet traffic between your modem and your devices.  

Sharing the Internet with Multiple Devices  

As previously mentioned, your modem connects to a router via an Ethernet cable. The router can then share that internet connection with multiple other devices in your home using either an additional Ethernet cable or their built-in antennas that connect to your WiFi network.  

Routers monitor all the information being shared between each device and the modem by keeping track of their MAC (media access control) addresses. For example, if you are trying to listen to music on your laptop, your router makes sure that your laptop receives the instruction to play music, not your phone that is connected to the same network. Basically, routers take the internet connection and ensure that it runs smoothly and correctly to each individual device.  

In Short, Your Router Does the Following: 

  • Shares information by routing the internet connection to all of your devices (like phones, laptops, smart TVs. etc.) 
  • Connects devices by allowing them to share files and peripherals (like printers, keyboards, mouses, etc.) 
  • Hides your devices this prevents bad actors on the Internet from accessing the devices on your network. 

Buying a Router  

If you own a smaller home or apartment, single-unit routers usually provide a strong enough signal to provide a wireless connection to all corners of your home. 

 For larger homes with unique layouts - multiple floors, thick cement walls, vast space, etc. - one wireless router isn't enough and may result in dead zones. This is where a whole-home WiFi mesh system or  WiFi extender may be needed. 

Do You Need both a Modem and a Router? 

This answer depends on how many devices you have, and whether or not you want them to connect wirelessly to the internet. If you only need to connect a single device, you can do so with simply a modem and a cable. If you want to hook up multiple devices on a home network or use WiFi, however, you will also need a router.  

There is also an option to buy a router-modem combo device like the MG7540, MG7550 or MG7700Although these don’t require as many wires or cables to set up, they also don’t allow for as much flexibility. There are a few more things when to consider before investing in a router-modem combination advice, but that’s a topic for a future blog post.  


Let’s Recap 

Cable modems  


Cable Modems Can:  

  • Connect to your ISP using a wide area network (WAN) 
  • Decode the signal from your ISP so that it is readable by your devices.  
  • Maintain a public IP address, which can be accessed over the internet. 

Routers Can:  

  • Establish a local area network (LAN) within your home or office. 
  • Create and manage WiFi. 
  • Splits an internet connection to several devices. 
  • Maintain a private IP address, which cannot be found on the web.  


Cable Modems Can Not:  

  • Set up a local network. 
  • Run WiFi. 
  • Connect multiple devices 


Routers Can Not:  

  • Connect to the internet without a modem.  
  • Decode the signal from an ISP.