Unit 4: Computer Networks

4.1 Introduction to Computer Networks

1. Introduction: The Backbone of Modern Business

In today’s interconnected world, a computer network is not just an IT utility; it is the central nervous system of any modern business. A computer network is a collection of interconnected computers, servers, printers, and other devices (called nodes) that can communicate with each other to share data and resources.

For a business, this means seamless communication, efficient data sharing, and the ability to run critical applications that connect different departments and even different global locations. From a simple email sent between colleagues in the same office to a complex financial transaction processed across continents, networks make it all possible. Understanding the fundamentals of networking is essential for any business professional to appreciate how technology drives efficiency, collaboration, and competitive advantage.

2. The Core Communication System

All network communication, regardless of its complexity, is built upon five fundamental components:

  • Sender (Source): The device that initiates the data transmission. This could be a computer, a smartphone, or a server.
  • Receiver (Destination): The device that is the intended recipient of the data.
  • Message (Data): The information being transmitted. This can be text, numbers, images, audio, or video. Data is typically sent in small, manageable chunks called packets.
  • Transmission Medium: The physical path through which the message travels from the sender to the receiver. This can be wired (like a cable) or wireless (like air).
  • Protocol: A set of rules that governs data communication. Protocols ensure that the sender and receiver can understand each other, much like a shared language and grammar rules allow two people to have a conversation. The most common protocol suite for the internet is TCP/IP (Transmission Control Protocol/Internet Protocol).

3. Data Transmission Modes

Data transmission modes define the direction of signal flow between two linked devices.

  • Simplex: Communication is unidirectional, like a one-way street. Only one of the two devices on a link can transmit; the other can only receive.
    • Example: A traditional radio broadcast, where the signal goes from the station to your radio, but not back. In business, data entry from a keyboard to a computer is simplex.
  • Half-Duplex: Each device can both transmit and receive, but not at the same time. When one device is sending, the other can only receive, and vice-versa.
    • Example: A walkie-talkie. You press a button to talk, and release it to listen.
  • Full-Duplex: Both devices can transmit and receive simultaneously. The communication channel is like a two-way street.
    • Example: A telephone conversation or a video conference call, where both parties can talk and be heard at the same time. This is the most common mode for business communication systems.
flowchart TB
    subgraph CORE["Core Communication Components"]
        direction LR
        SENDER["📤 Sender\n(Source)"]
        MSG["📨 Message\n(Data Packets)"]
        MEDIUM["🔌 Medium\n(Wired/Wireless)"]
        RECEIVER["📥 Receiver\n(Destination)"]
        PROTOCOL["📋 Protocol\n(TCP/IP)"]
    end

    SENDER --> MSG --> MEDIUM --> RECEIVER
    PROTOCOL -.->|"Governs"| MEDIUM

    subgraph MODES["Data Transmission Modes"]
        direction TB

        subgraph SIMPLEX["Simplex (One-Way)"]
            S1["📻 Radio"] -->|"→"| S2["👂 Listener"]
        end

        subgraph HALF["Half-Duplex (One at a time)"]
            H1["📻 Walkie"] <-->|"⇄"| H2["📻 Talkie"]
        end

        subgraph FULL["Full-Duplex (Simultaneous)"]
            F1["📞 Phone A"] <-->|"⇆"| F2["📞 Phone B"]
        end
    end

    style SIMPLEX fill:#ffebee,stroke:#c62828
    style HALF fill:#fff3e0,stroke:#ff9800
    style FULL fill:#e8f5e9,stroke:#388e3c
    style CORE fill:#e3f2fd,stroke:#1976d2

4. Data Transmission Media

Transmission media are the physical channels that carry data signals. They are broadly classified into two groups.

4.1 Guided Media (Wired)

These media provide a physical conduit from one device to another.

  • Twisted-Pair Cable: Consists of pairs of insulated copper wires twisted together. It is the most common and least expensive type of wired media, used extensively in office LANs (Local Area Networks). Ethernet cables (like Cat5e or Cat6) are a prime example.
  • Coaxial Cable: Has a single copper conductor at its center, surrounded by insulation and a braided metal shield. It offers better protection from interference than twisted-pair and is commonly used for cable television and internet services.
  • Fiber-Optic Cable: Transmits data as pulses of light through thin strands of glass or plastic. It is the fastest and most secure form of guided media, capable of transmitting data over very long distances with minimal signal loss. It forms the backbone of the internet and is used for high-speed connections between cities and countries.

4.2 Unguided Media (Wireless)

These media transport signals through the air or space without a physical cable.

  • Radio Waves: Used for multicast communications, such as Wi-Fi and Bluetooth. They can penetrate walls and are ideal for creating wireless networks within an office building or campus.
  • Microwaves: Provide a high-speed, line-of-sight transmission path. They are used for long-distance telephone communication and as a backbone for cellular networks.
  • Infrared: Used for short-range, line-of-sight communication. A common example is a TV remote control. It is not widely used for computer networking due to its limitations.

5. Types of Computer Networks

Networks are typically classified by their geographical scope.

  • LAN (Local Area Network): A network that is confined to a relatively small area, such as a single office building, a school campus, or a home. LANs are typically owned and managed by the organization they serve. The primary purpose is to share resources like printers, files, and applications among users within the organization.
  • MAN (Metropolitan Area Network): A network that spans a physical area larger than a LAN but smaller than a WAN, such as a city. A MAN might be used to connect all the branches of a bank within Kathmandu.
  • WAN (Wide Area Network): A network that covers a large geographical area, such as a country, continent, or even the entire globe. A WAN connects multiple LANs together. The Internet is the world’s largest public WAN. Businesses use WANs to connect their head office with branch offices in different cities or countries.

6. Network Topologies

Network Topology refers to the physical or logical arrangement of nodes in a network.

  • Bus Topology: All devices are connected to a single central cable, called the bus or backbone. It’s simple to install but a break in the main cable will disable the entire network. (Largely obsolete for modern LANs).
  • Star Topology: All devices are connected to a central hub or switch. This is the most common topology used in modern LANs. It is easy to manage and troubleshoot; if one connection fails, it does not affect the others. However, if the central switch fails, the entire network goes down.
  • Ring Topology: Each device is connected to exactly two other devices, forming a single continuous pathway for signals through each node - a ring. (Less common today).
  • Mesh Topology: Every device is connected to every other device on the network. This provides a high level of redundancy and reliability. If one path fails, data can be rerouted. The internet’s backbone is a mesh network. It is expensive and complex to implement.
  • Hybrid Topology: A combination of two or more different topologies. For example, a company might have a star topology in each department, with the departmental networks connected via a bus backbone.

7. Business Applications Across Functions

Computer networks are integral to the operations of every business department.

  • Finance & Accounting:
    • Secure Transactions: WANs are used to securely connect bank branches and ATMs to a central server for real-time transaction processing.
    • Centralized Systems: Accountants across different offices can access a centralized accounting system (like an ERP) hosted on a company server.
    • Financial Data Feeds: Networks provide real-time stock market data to traders and financial analysts.
  • Human Resources (HR):
    • HR Information Systems (HRIS): A centralized database on the company network stores employee records, manages payroll, and tracks leave applications.
    • Recruitment: Online job portals and video conferencing for interviews with candidates in different cities are enabled by the internet (a WAN).
    • E-learning: Employees can access training modules hosted on the company’s internal network (intranet).
  • Operations & Supply Chain Management:
    • Inventory Management: A LAN within a warehouse connects barcode scanners and computers to a central inventory system, while a WAN connects multiple warehouses to provide a company-wide view of stock levels.
    • Supplier Collaboration: Businesses use networks to connect with suppliers for automated ordering (e-procurement) and to track shipments in real-time.
    • ERP Systems: Enterprise Resource Planning systems rely entirely on the corporate network to integrate data from all business functions into a single system.
  • Marketing & Sales:
    • Customer Relationship Management (CRM): Sales and marketing teams access a shared CRM database over the network to track customer interactions, manage leads, and analyze sales data.
    • E-commerce: A company’s website, hosted on a server connected to the internet, allows customers to browse products and make purchases from anywhere in the world.
    • Digital Advertising: Networks are the medium through which all digital ads are delivered to target audiences on websites and social media platforms.

8. Real-World Examples from Nepal

  1. Banking Network (e.g., NIC Asia Bank): NIC Asia Bank operates hundreds of branches and ATMs across Nepal. They use a private WAN to connect all these locations to their central data center in Kathmandu. This network allows a customer to deposit cash in a branch in Biratnagar and have it instantly reflected in their account, which can then be withdrawn from an ATM in Pokhara. The network uses a combination of fiber-optic and microwave links for reliability and is built on a hybrid topology to ensure continuous operation. This is a critical application of networking in the Finance sector.

  2. E-commerce Platform (Daraz Nepal): Daraz, a leading e-commerce company, relies heavily on a multi-layered network.
    • Internal LANs: Inside their warehouses, they use Wi-Fi (radio waves) and wired Star topology LANs to connect scanners, computers, and printers for managing inventory and processing orders (Operations).
    • WAN: A secure WAN connects their warehouses, corporate offices, and delivery hubs across the country.
    • The Internet (WAN): Their platform is accessible to millions of customers via the internet, which they use for all their Marketing and Sales activities. This entire ecosystem is impossible without robust networking.
  3. Internet Service Providers (ISPs) (e.g., WorldLink): ISPs like WorldLink are businesses that build and manage networks. They have built a massive MAN in Kathmandu and other cities, and a WAN across Nepal, primarily using fiber-optic cables. They provide the fundamental network infrastructure that enables all other online businesses, from digital wallets like eSewa and Khalti to corporate clients and home users. They manage complex network topologies to ensure their service is reliable and fast, forming the digital backbone of the nation’s economy.

9. Key Takeaways

  • A computer network is a system of interconnected devices for sharing resources and data. It is fundamental to modern business.
  • The five core components of communication are the sender, receiver, message, medium, and protocol.
  • Transmission can be Simplex (one-way), Half-Duplex (one way at a time), or Full-Duplex (two-way simultaneously).
  • Media can be Guided (wired, like fiber-optic) or Unguided (wireless, like Wi-Fi).
  • Networks are classified by size: LAN (office), MAN (city), and WAN (country/global).
  • Star Topology is the most common layout for modern office LANs due to its reliability and ease of management.
  • Every business function—from Finance and HR to Operations and Marketing—relies on computer networks to operate efficiently.

10. Review Questions

  1. Describe the five essential components of a data communication system using the example of sending an email from your office computer.
  2. Explain the difference between a LAN and a WAN. Provide a specific business example for each from the Nepalese context.
  3. A new company is setting up an office with 50 employees. Which network topology would you recommend for their office LAN and why? What type of transmission media would be most suitable?
  4. How does a supply chain management system in a company like Bhat-Bhateni Supermarket use networking to track inventory across its different stores?