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If you have DSL or Cable, a router is a smart way to share the bandwidth with other computers in the home. You could do that with dial-up but it'll still be slow.
I agree with everything Miz said and one of the more important features of a router is the hardware firewall protection it provides. It's not bulletproof but if you combine that feature with a software firewall, then you give your computer(s) the best chance to avoid intrusions. An intrusion is like a lightning strike: you only need to get hit once to know how bad it can be!
Hardware-wise, I've used Linksys, D-Link, Netgear, Hawking, SMC, etc. You want to go with a company that has good support mainly for software upgrades and clear documentation. All these companies are good because they compete with each other (so they will be on top of qualilty if they want to stay in business) but Linksys, D-link and Netgear seem to have the better support and documentation. If you've never installed this type of hardware before, you need good and clear (not to mention easy) documentation! Honestly, I don't think you can go wrong with either.
As Miz stated, you need to decide between a wired or wireless router. Many are now hybrids so you can buy a router that is both wired and wireless without buying them separately and they usually have a four-port switch built-in so you won't have to worry about that either! I suggest buying a hybrid model, so if you want to expand your network later on, you are set to go with a minimum of fuss!
Good luck!
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