The terms ‘modem’ and ‘router’ are often used interchangeably, but the two devices aren’t actually the same. So, what is the difference between a modem vs router, and do you really need both?
In this article Canstar Blue explains the differences between modems and routers and if you should buy a combination of the two.
Jump to:
- What’s the difference between modems and routers?
- What is a modem?
- What is a router?
- How do modem-routers work?
- Is my modem compatible with my internet service provider?
- Internet plans with included modem-routers
Modem vs router: What’s the difference?
A router connects your home devices to each other, while your modem connects to the internet, enabling access to websites like Google and Facebook. When you connect to WiFi, you’re connecting to the router, which then sends your data through the modem to the internet. Although the words ‘router’ and ‘modem’ are often used interchangeably, each device serves a distinct function.
If you have multiple devices to connect to your WiFi network, you’ll need a router with a built-in modem.
If you have a modem-only device, it is usually wired and you’ll need to connect your device to it directly via an Ethernet cable to access the internet. To get multiple devices connected, you’d need to buy a separate router and plug it into the modem.
Note that both the modem and router are separate from your NBN connection box, seen in FTTP, FTTC and HFC connections.
Luckily, providers and retailers offer hybrid modem-routers. This means that you simply need to ‘plug and play’ without fiddling with two devices. You’ll only need to get into the back end of the one device through a setup portal, and the setup process will cover both the modem and router components of your hardware.
You can buy a modem-router hybrid separately from your internet plan and use it on a BYO basis, or add a compatible device to your broadband service at signup.
Compare NBN providers and plans
Thinking about a new NBN provider or plan to go alongside your new modem, router or modem-router? Check out some of the providers and plans available in the table below. The table contains affiliate links.
The following table shows a selection of sponsored unlimited data Standard Plus Evening Speed (NBN 50), and Premium Evening Speed (NBN 100) plans on Canstar Blue’s database with links to referral partners.
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1 Month Contract (1 month min. cost $284) Typical evening speed of 100Mbps
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Unlimited Data/month |
$85.00 Cost/month |
Go to Site |
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1 Month Contract (1 month min. cost $89.99) Typical evening speed of 98Mbps
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Unlimited Data/month |
$79.99 Cost/month |
Go to Site |
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1 Month Contract (1 month min. cost $79.99) Typical evening speed of 100Mbps
|
Unlimited Data/month |
$79.99 Cost/month |
Go to Site |
Unlimited Home Standard (NBN 50) Plans
The following table shows a selection of published unlimited NBN 50 plans on Canstar Blue’s database, listed in order of standard monthly cost (excluding discounts), from the lowest to highest, and then by alphabetical order of provider. Use our comparison tool above to see plans from a range of other providers. This is a selection of products with links to referral partners.
Unlimited Home Fast (NBN 100) Plans
The table below shows a selection of published unlimited NBN 100 plans on Canstar Blue’s database, listed in order of monthly cost, from the lowest to highest, and then by alphabetical order of provider. Use our comparison tool to see plans from a range of other providers. This is a selection of products with links to referral partners.
What is a modem?
A modem, short for ‘modulator-demodulator,’ is a device that connects your home to your internet service provider (ISP) via a physical connection. It translates the data from your ISP into a format that your home network devices can use.
There are three common types of modem connections:
- Dial-up: Uses a phone line to connect to an ISP. This is the oldest type of modem connection and has mostly been replaced by faster options.
- DSL (Digital Subscriber Line): Also uses a phone line but offers much higher speeds than dial-up.
- Cable: Uses a cable TV line to connect to an ISP and is the most common type of modem connection today.
Pros and cons of modems
Pros of modems
- Essential for internet access: Provides the crucial connection to your ISP for online access.
- Flexibility: Compatible with various ISPs and network setups.
- Dedicated functionality: Ensures reliable data transmission between your ISP and home network.
Cons of modems
- Single function: Only provides internet access, requiring an additional router for a complete network.
- Initial cost: Buying a standalone modem can be more expensive than renting from an ISP.
- Compatibility issues: Not all modems work with every ISP or network type.
How much does a modem cost?
Modems typically cost between $100 and $300,: however, high end models can be over $700. Standalone modems are generally cheaper than modem-routers, but they’re more technical, and you’ll likely end up spending a similar amount on a router.
What is a router?
A router is a device that creates a local area network (LAN) in your home. It connects to your modem and then to your devices, allowing them to communicate with each other and access the internet.
Routers come in two main types: wireless and wired.
- Wireless routers: Connect to a modem via an Ethernet cable and transmit data by converting binary code into radio waves. These signals are broadcast wirelessly using antennas, creating a wireless local area network (WLAN) that connects several wireless devices.
- Wired routers: Connect to a modem using an Ethernet cable and use additional cables to link network devices to one another and to the internet.
Wireless routers are generally easier to set up and use, while wired routers can provide a more secure connection.
It’s quite uncommon that you’ll come across anyone using a separate modem and router internet connection, as most modems and routers sold by retailers these days are hybrid modem-routers, meaning they do two jobs in one.
Pros and cons of routers
Pros of routers
- Firewall protection: Provides a barrier against outside threats by acting as a firewall.
- Network security: Helps secure your home network by hiding the IP addresses of your devices from the public internet.
- Parental controls: Allows you to restrict internet access for certain devices.
- VPN connectivity: Can be used to connect to a virtual private network (VPN), offering additional security and privacy.
Cons of routers
- Internet connectivity: Cannot connect directly to the internet.
- Distance sensitivity: WiFi can be distance-sensitive, meaning the signal may get weaker based on proximity to the router.
How much does a router cost?
Routers typically cost between $200 and $1000, depending on the type of router you get, its features and if it’s a standalone router or a modem-router hybrid.
How does a modem-router work?
Rather than weighing up modems vs routers, you’re now able to buy both devices in the one piece of hardware. Sometimes referred to as a ‘Gateway’, modem-routers work by combining the functions of a modem and a router, connecting to your internet service provider to translate data and create a local area network (LAN) in your home.
A modem-router manages both wired and wireless connections, assigning IP addresses to your devices and allowing them to communicate and access the internet.
Is my modem compatible with my internet service provider?
To find out if your modem is compatible with your internet service provider , check the modem’s specifications and consult your ISP. Most ISPs list compatible modems on their websites, or you can ask their customer support for help. When choosing a modem, make sure it supports the necessary internet speeds, technologies (like VDSL, fibre, HFC or satellite), and any extra features you might need, such as VoIP calls.
Compare internet plans with included modem-routers
If you’re looking for a new provider and a new modem-router, many providers include a device on their broadband plans, often at no extra charge. Below you’ll find a selection of plans with modem routers bundled in.
Unlimited Premium Evening Speed (NBN 100) Plans
The following table shows a selection of published unlimited Premium Evening Speed (NBN 100) plans on Canstar Blue’s database, listed in order of standard monthly cost, from the lowest to highest, and then by alphabetical order of provider. Use our comparison tool above to see plans from a range of other providers. This is a selection of products with links to a referral partner.
Unlimited Standard Plus Evening Speed (NBN 50) Plans
The following table shows a selection of published unlimited Standard Plus Evening Speed (NBN 50) plans on Canstar Blue’s database, listed in order of standard monthly cost, from the lowest to highest, and then by alphabetical order of provider. Use our comparison tool above to see plans from a range of other providers. This is a selection of products with links to a referral partner.
Unlimited Standard Evening Speed (NBN 25) Plans
The following table shows a selection of published unlimited Standard Evening Speed (NBN 25) plans on Canstar Blue’s database, listed in order of standard monthly cost, from the lowest to highest, and then by alphabetical order of provider. Use our comparison tool above to see plans from a range of other providers. This is a selection of products with links to a referral partner.
Modem vs router: Which should I choose?
If you ask an electronics retailer for a modem or a router, they might refer you to the same device. These days, the terms are often used interchangeably because many devices combine both functions into one package. While you can’t go wrong with a modern device, if you only have a modem, you will still need a router to create a home network.
Opting for an internet provider that offers an included modem on your broadband plan can simplify the setup process. However, if you’re a discerning buyer, choosing your own equipment might be your best option. Remember: routers distribute the WiFi network throughout your home, while modems connect you directly to the internet.
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