A modem is a piece of computer hardware. It is used to communicate between distant computers. Two modems, one on each computer, are required to make a connection, and each modem can send and receive data to and from the other modem. The word modem stands for modulator - demodulator.
- Modulation is changing the digital data from a computer to analog data (audio tones or sounds) so that it can be sent over telephone lines.
- Demodulation is changing the analog data which is received over the telephone lines to digital data to be used by the computer.
Modems are generally classified by the amount of data they can send in a given time, normally measured in bits per second (bit/s, or bps). They are also classified by their connection method. Dial-up modems were the usual kind in the 20th century, and DSL modems and Cable TV modems are now more used.
There are 3 types of modems: internal modems, external modems, and PC card modems. Commonly, modems are used to connect to the Internet through telephone service or cable service. Slow telephone service is called dial-up (maximum 56 kilobaud), faster telephone service is called DSL. DSL data transfer rates are comparable to cable service transfer rates.
A CEA study in 2006 found that dial-up Internet access is on a decline in the United States. In 2000, dial-up Internet connections accounted for 74% of all U.S. residential Internet connections. The number of dial-up modem users per capita in the U.S. has been more or less mirrored in Canada and Australia for the past 20 years.
Dial-up modem use in the US dropped to 60% by 2003, and in 2006 stood at 36%. Voiceband modems were once the most popular means of Internet access in the U.S. But as more homes adopted faster ways of accessing the Internet, the traditional 56K modem is losing popularity.