Switches play an integral part in most Ethernet local area networks (LANs). Mid-to-large sized LANs contain a number of linked managed switches. Small office/home office (SOHO) applications typically use a single switch, or an all-purpose converged device such as a gateway to access small office/home broadband services such as DSL or cable internet. In most of these cases, the end-user device contains a router and components that interface to the particular physical broadband technology. User devices may also include a telephone interface for VoIP.

A standard 10/100 Ethernet switch operates at the data-link layer of the OSI model to create a different collision domain for each switch port. If you have 4 computers (e.g., A, B, C, and D) on 4 switch ports, then A and B can transfer data back and forth, while C and D also do so simultaneously, and the two "conversations" will not interfere with one another. In the case of a "hub," they would all share the bandwidth and run in Half duplex, resulting in collisions, which would then necessitate retransmissions. Using a switch is called microsegmentation. This allows you to have dedicated bandwidth on point-to-point connections with every computer and to therefore run in Full duplex with no collisions.