You can use either a USB or Ethernet modem to connect your computer to the data line.
USB is a peripheral technology (it's for connecting printers/external drives/etc.), it's not that clever, and when you connect a USB modem to your machine, you are actually using your computer to drive the modem (so a USB modem isn't even really a modem, it and the PC's intelligence combine to create a modem).
Ethernet is a network technology, it's for networking, and an Ethernet modem has all the intelligence needed to operate and maintain the data connection independently of any computers that connect to it.
Reasons why you should use an Ethernet modem:
a) Operates independently of any computer, don't have to keep a PC switched on in order for it to be connected.
b) Driverless, so you won't have to load any drivers to get set up, and you won't have any driver headaches as you upgrade your system, change your machine.
c) OS independent, because the Ethernet modem operates in the TCP/IP domain, any Ethernet capable machine can connect to it, regardless of its OS (Mac/PC/Linux). In computerland, everybody speaks Ethernet.
d) Reliability, USB modems are given away for free by ISP's for a reason, they are cheap, disposable, usually low grade technology (they soon become outdated). Ethernet modems are built to last, and will always be useful.
e) Configurability (new word), you have the flexibility to bridge/route/DMZ/firewall/etc. with an Ethernet modem, try doing that with a USB modem!
f) Security. Having all the internet traffic coming through a PC's USB modem is like a bank having its customers entrance behind the cashiers desks, and then leading out them through to plate glass fronted customers area.
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