11.3 Networking Concepts & Internet Protocols

Networking Concepts & Internet Protocols

Modern financial infrastructure relies heavily on computer networks. Real-Time Gross Settlement (RTGS), National Electronic Funds Transfer (NEFT), Unified Payments Interface (UPI), and branch banking operations connect distributed nodes to central data centers via secure Local Area Networks (LANs) and Wide Area Networks (WANs).

---

1. Network Topologies & Geographic Classification

A Network Topology defines the geometric layout of interconnected communication devices.

Topology Comparison Table

Network Scale Classifications

• PAN (Personal Area Network): Scale up to 10 meters (Bluetooth, Zigbee).
• LAN (Local Area Network): Covers a single room, office floor, or bank branch.
• MAN (Metropolitan Area Network): Spans a city or municipal area (e.g., city-wide ATM fiber ring).
• WAN (Wide Area Network): Spans across national borders and continents using lease lines, undersea fiber cables, and VSAT satellite communication (e.g., SWIFT network).
• SAN (Storage Area Network): High-speed dedicated network connecting servers to data storage blocks.

---

2. OSI 7-Layer Model vs. TCP/IP Model

The Open Systems Interconnection (OSI) model provides a 7-layer theoretical blueprint for communication protocol design, whereas the TCP/IP model is the 4-layer practical framework powering the global Internet.

+-----------------------------------------------------------------+
|                OSI MODEL vs. TCP/IP MODEL STACK                 |
|                                                                 |
|     OSI 7-LAYER MODEL                   TCP/IP 4-LAYER MODEL    |
|   +--------------------+               +--------------------+   |
|   | Layer 7: Application|               |                    |   |
|   +--------------------+               |                    |   |
|   | Layer 6: Present.  |--------------->| Application Layer  |   |
|   +--------------------+               | (HTTP, HTTPS, SSH, |   |
|   | Layer 5: Session   |               |  DNS, SMTP, FTP)   |   |
|   +--------------------+               +--------------------+   |
|   | Layer 4: Transport |-------------->| Transport Layer    |   |
|   +--------------------+               | (TCP, UDP)         |   |
|   | Layer 3: Network   |-------------->| Internet Layer     |   |
|   +--------------------+               | (IP, ICMP, ARP)    |   |
|   | Layer 2: Data Link |               | Network Access     |   |
|   +--------------------+-------------->| Layer (Ethernet,   |   |
|   | Layer 1: Physical  |               |  Wi-Fi, MAC)       |   |
|   +--------------------+               +--------------------+   |
+-----------------------------------------------------------------+

Protocol Data Units (PDUs) & Layer Functions

1. Application Layer (Layer 7): Provides software interfaces for user applications. PDU = Data.
2. Presentation Layer (Layer 6): Handles data formatting, character encoding (ASCII/Unicode), encryption (SSL/TLS), and compression. PDU = Data.
3. Session Layer (Layer 5): Establishes, maintains, and terminates communication sessions between applications. PDU = Data.
4. Transport Layer (Layer 4): End-to-end communication, segmentation, flow control, and error correction. PDU = Segment (TCP) / Datagram (UDP).
   • TCP (Transmission Control Protocol): Connection-oriented, reliable, guarantees delivery via 3-Way Handshake (SYN -> SYN-ACK -> ACK).
   • UDP (User Datagram Protocol): Connectionless, lightweight, low latency, no delivery guarantee (used in DNS queries, VoIP, live streaming).
5. Network Layer (Layer 3): Handles logical IP addressing, packet routing across networks, and path determination. PDU = Packet.
6. Data Link Layer (Layer 2): Handles physical hardware addressing (MAC addresses), frame construction, and error detection (CRC). Subdivided into Logical Link Control (LLC) and Media Access Control (MAC). PDU = Frame.
7. Physical Layer (Layer 1): Transmits raw binary bits ($0$s and $1$s) over physical medium (copper Cat6 cables, optical fiber, wireless RF). PDU = Bit.

---

3. Network Hardware Devices & Standard Ports

Well-Known Port Numbers

• FTP (File Transfer Protocol): Ports 20 (Data Transfer) & 21 (Control Commands)
• SSH / SFTP (Secure Shell / Secure FTP): Port 22
• Telnet (Unencrypted Remote Text Shell): Port 23
• SMTP (Simple Mail Transfer Protocol - Sending Email): Port 25 (Unencrypted) / 587 (TLS)
• DNS (Domain Name System - Domain to IP Resolution): Port 53
• DHCP (Dynamic Host Configuration Protocol - Auto IP Assignment): Ports 67 (Server) & 68 (Client)
• HTTP (Hypertext Transfer Protocol - Web Browsing): Port 80
• POP3 (Post Office Protocol v3 - Retrieving Email): Port 110 (Unencrypted) / 995 (SSL/TLS)
• IMAP (Internet Message Access Protocol - Syncing Email): Port 143 (Unencrypted) / 993 (SSL/TLS)
• SNMP (Simple Network Management Protocol): Port 161
• HTTPS (HTTP Secure - Encrypted SSL/TLS Web Traffic): Port 443

---

4. IP Addressing & Subnetting Mechanics

An IPv4 Address is a 32-bit binary integer displayed as four 8-bit octets separated by dots (e.g., $192.168.10.75$).

Traditional IPv4 Address Classes

Note: The range $127.0.0.0 - 127.255.255.255$ is reserved for local host loopback testing ($127.0.0.1$).

Subnet Host Capacity Formula

For a subnet with $h$ host bits:

$\text{Total Host IP Addresses} = 2^h$ $\text{Usable Host IP Addresses} = 2^h - 2$

(Subtract $2$ because the first address is reserved for the Network ID and the last address is reserved for the Subnet Broadcast Address).

Step-by-Step Worked CIDR Subnetting Example

Problem: Given the IP address and CIDR prefix $192.168.10.75 / 26$, calculate:

1. Subnet Mask
2. Network ID
3. Broadcast Address
4. Total Usable Host IP Range and Host Count

Step A: Calculate Subnet Mask

A $/26$ prefix means the first 26 bits are set to $1$ and the remaining $32 - 26 = 6$ host bits are set to $0$:

• Binary: $11111111 . 11111111 . 11111111 . 11000000_2$
• Octet 4 value: $128 + 64 = 192$
• Subnet Mask = $255.255.255.192$

Step B: Find Block Size & Network ID

• Block Size = $256 - 192 = \mathbf{64}$
• Subnet ranges increment in blocks of 64: $0-63$, $64-127$, $128-191$, $192-255$.
• Octet 4 value is $75$, which falls inside the block $64 - 127$.
• Network ID = $192.168.10.64$

Step C: Calculate Broadcast Address & Usable Range

• Broadcast Address: One value below the next block ($128 - 1 = 127$) $\longrightarrow$ $192.168.10.127$
• Usable Host Range: $192.168.10.65$ to $192.168.10.126$
• Usable Host Count: $2^6 - 2 = 64 - 2 = \mathbf{62 \text{ hosts}}$

---

Exam Strategies & Common Traps

1. Layer 2 vs. Layer 3 Devices: Switches operate at Layer 2 using MAC addresses. Routers operate at Layer 3 using IP addresses. Switches create isolated collision domains; Routers create isolated broadcast domains.
2. Usable Host Formula Trap: Always remember to subtract 2 from $2^h$ when calculating usable hosts for standard subnets (one for Network ID, one for Broadcast).
3. TCP vs. UDP Port Association: Secure HTTPS runs on Port 443; plain HTTP runs on Port 80. DNS uses UDP port 53 for small queries and TCP port 53 for zone transfers.