Hardware firewalls are important because they provide a strong degree of protection from most forms of attack coming from the outside world. Additionally, in most cases, they can be effective with little or no configuration, and they can protect every machine on a local network.

A hardware firewall in a typical broadband router employs a technique called packet filtering, which examines the header of a packet to determine its source and destination addresses. This information is compared to a set of predefined and/or user-created rules that determine whether the packet is to be forwarded or dropped. A more advanced technique called Stateful Packet Inspection (SPI), looks at additional characteristics such as a packet’s actual origin (i.e. did it come from the Internet or from the local network) and whether incoming traffic is a response to existing outgoing connections, like a request for a Web page. Most hardware residential firewalls have an Achilles’ heel in that they typically treat any kind of traffic traveling from the local network out to the Internet as safe, which can sometimes be a problem.

Consider this scenario: What would happen if you received an e-mail message or visited a website that contained a concealed program? Let’s say this program was designed to install itself on your machine and then surreptitiously communicate with someone via the Internet — a distributed denial of service (DDoS) attack zombie or a keystroke logger, for example? Trust me; this is by no means an unlikely scenario.

To most broadband hardware firewalls, the traffic generated by such programs would appear legitimate since it originated inside your network and would most likely be let through. This malevolent traffic might be blocked if the hardware firewall was configured to block outgoing traffic on the specific Transmission Control Protocol/Internet Protocol (TCP/IP) port(s) that the program was using, but given that there are over 65,000 possible ports and there’s no way to know which ports a program of this nature might use, the odds of the right ones being blocked are slim.

Moreover, blocking too many ports would almost certainly adversely affect your ability to use some programs (many games, for instance). Also, some broadband router firewalls don’t even provide the ability to restrict outgoing traffic, only incoming traffic.

Advantages of Software Firewalls:

Now consider what a software firewall might do in the aforementioned scenario. When you first set up a software firewall, you can specify which applications are allowed to communicate over the Internet from that PC. Programs that aren’t explicitly allowed to do so are either blocked or else the user is prompted for confirmation before the traffic is allowed to pass. Therefore, it would likely intercept this kind of traffic before it left your computer.

Another potential scenario where a software firewall would be useful is in the case of an e-mail worm with its own e-mail sever, like the recent “SoBig” worm. Its built-in mail server could attempt to send mail on the valid Simple Mail Transfer Protocol (SMTP) port (25), which would probably pass through the router because of its trusted origin.

On the other hand, a software firewall could be configured to only allow Microsoft Outlook to use port 25 (assuming Outlook is your e-mail client). Any attempt by another application to use the port would be dropped, or blocked pending user confirmation. For that matter, the application’s attempt to use any port would be blocked if the firewall was configured that way.

By comparison, a hardware firewall that had the ability to filter outgoing traffic might allow you to block most kinds of traffic from a particular PC, but it wouldn’t be able to flag you and alert you to repeated attempts to infiltrate your computer.

One obvious downside to software firewalls is that they can only protect the machine they’re installed on, so if you have multiple computers (which many small offices do), you need to buy, install, and configure a software firewall separately on each machine. This can get expensive and can be difficult to manage if you have a lot of computers.

But the fact of the matter is that software firewalls generally offer the best measure of protection against certain types of situations like Trojan programs or e-mail worms. Speaking of which, a firewall isn’t the only protection method available to you. Whether you end up using a software firewall or a hardware firewall, you should always supplement it with anti-virus software.

A good anti-virus package is just as important as a firewall, and I would seriously suggest that you invest in a good one (I’m partial to both Norton and McAfee myself). However, keeping your virus definitions updated is far more important than which program you use. I cannot stress the importance of this enough. Making sure your definitions are current is absolutely critical to maintaining your protection. Many Anti-virus programs today can be configured to automatically update themselves, so you have no excuse for not maintaining them.

The bottom line is that with any home-office broadband connection, a hardware firewall should be considered a bare minimum, and supplementing it with a software firewall on one or more computers (and don’t forget anti-virus software) is almost always a good idea.