A router functions as an access point for the devices in your home to reach the internet. Usually connected to the DSL/Cable modem your isp provides, the router can be accessed by wire or wireless. Security and password are set when you give the Name to the SSID, WPA2 is the security type you wish to use. 'Software routers' are a software that allows persons on devices near you to use the internet access of the laptop to share internet service.