What is the difference between LAN and WAN?

City scape with connected lines representing a network

Networking is the heart and backbone of all information sharing and internet activities of organisations today. It drives and facilitates business communication and other key functions. With a well-designed and configured business network, your business can run as effectively, efficiently, securely and productively as possible. There are two main types of networks – LAN and WAN. What is the difference between LAN and WAN? And how can your organisation benefit from either or both of these networks? This article details the key aspects of both networks and how they can improve the running of your organisation.

Let’s start from the basics,

What is a Network?

A network is any group of computers (workstations or servers) and devices like printers and smartphones that are connected and can communicate with each other. As mentioned earlier, there are two main types of networks i.e. LAN and WAN. LAN is short for local area networks while WAN is short for wide area networks.

Local Area Network (LAN)

LAN, local area network is a group of computers and other network devices such as printers, servers and laptops connected within the same geographic location. LANs are typically found in offices, schools or other establishments and operate within the same building or the same floor of an office building.

LAN Setup

A basic LAN is created by connecting computers and other network devices using Ethernet cables or Wi-Fi through a network switch. Each computer and network equipment is assigned a unique IP address either manually or automatically through a service called DHCP (Dynamic Host Configuration Protocol). Most LANs comprise of a network switch and a network router either on the same device in a small LAN like a small office network or different devices like in an enterprise LAN network. Additionally, most modern routers have Ethernet ports or switch ports together with Wi-Fi capabilities hence the term WLAN (Wireless LAN) which falls in the LAN category.

Devices on the same LAN can see each other on the network and connect through various protocols for file transfer with or without encryption, connect to a remote command line or for Microsoft Remote Desktop etc. LANs also serve as the gateway to the internet for local devices through a centralised device such as a router through which internet traffic is sent and received.

LANs can be configured in many different ways depending on need including limiting and managing access to shared resources over the network among local users. These considerations carry a cost and security implication with security taking priority in today’s world of cybercrime.

Pros and Cons of LAN

One of the key advantages of LANs is the speed they offer which is typically over 1Gbps and significantly faster than the average WAN. On the other hand, its biggest downside is that it is limited to a local area such as an office building or school.

Wide Area Network (WAN)

Some people tend to think of WAN as a larger LAN although some foundational differences set them completely apart. For example, the internet itself is viewed as a WAN and, like typical WANs, it has a significantly more complicated infrastructure than LAN.

A WAN connects LANs typically across multiple locations including individual devices connecting from a remote distance. Think of it this way, if one of your employees wanted to send a file to a colleague next door, they will probably use LAN. However, if they wanted to send the same file to one of your satellite offices across the world, they will most likely use WAN.

WAN Setup

WANs often connect hundreds of devices, contain different sub-networks with differing security requirements and need to use more address space and employ more security measures. Typically, Internet Service Providers (ISPs) are the main players that create and implement WANs.

Devices can connect to a WAN through wired options such as Direct Internet Access (DIA), Metro Ethernet and T1 Cables or through wireless options that are now gaining popularity such as safelight signals, public Wi-Fi and 4G LTE services. WANs can be administered over a public or private connection or a hybrid of both.

Pros and Cons of WAN

A WAN can cover almost an unlimited geographical distance depending on resources. However, this also means that they are can be costly to implement, can increase latency, security exposure and lower speeds of data transfer.

Differences between LAN and WAN


Due to the technology and distance involved, LANs tend to transmit data more quickly and efficiently than WANs. This can be a determining factor for mission-critical business activities such as financial trades.

Network Security

LANs tend to be more secure as they can act as stand-alone networks without having to be connected to a WAN. WANs, on the other hand, are more prone to security concerns as they connect one LAN to another which can lead to intrusion.


LANs are typically internally owned by individual companies who then depend on the internet to act as a WAN. WANs, in contrast, are typically run by a collection of entities such as companies operating in a business network or city departments.

Having the Right Network for Your Organisation

LANs and WANs have some key similarities and some important differences that can contribute to the efficiency and productivity of an organisation. The important thing to remember when creating or upgrading your business network is to work with a reliable and experienced IT partner.

With close to 2 decades of providing the best data networking services to organisations all over the UK, we have the skills, experience and expertise to provide your organisation with an optimal business network. The AdEPT Nebula core, part of our WAN service can allow your organisation to operate, communicate and perform efficiently across multiple locations. Contact us today and let us help you get connected.

Written by Sami Malik

Marketing Campaigns Manager