ARPANET
From Computing and Software Wiki
ARPANET (Advanced Research Projects Agency Network) was the network that became the basis for the Internet. It was developed by ARPA (Advanced Research Projects Agency) of the United States Department of Defense. This network is based on packet switching, as opposed to circuit switching and was the world’s first operational network with that context.
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Circuit Switching
The old way that networks were run before ARPANET was circuit switching. This is when hosts on a network must establish a fixed connection before they can communicate with each other. That means that specif resources have to be allocated for that connection, so when there is no communication the resources are wasted for no reason, which can get costly. The simple analogy of this network is that of telephone connections. When two people want to talk a special connection is made just for them that will consume resources even if they don't say a word. This worked on a small scale but as one can image it would have been impossible to expand to many networks communicating with such a technology.
Packet Switching
With packet switching came a fresh new look on networks. Hosts on a network can simultaneously communicate with more than one computer by just sending and receiving packets (blocks of data) to each other. So this worked more as a postal system. The guarantee of the message going to the intended receiver is gone, since no concrete connection is established, but on the other side, just like a postal truck many messages can be carried at once which makes things a lot more efficient. So a address is where one would send packets and the network card would act a mailbox. Therefore many packets could be sent out at once and many can be received enabling communication with many hosts at the same time.
References
ARPANET on Wikipedia Circuit Switching on Wikipedia Packet Switching on Wikipedia History of ARPANET
