Where there are multiple subnets within the home, there is a need to route between them, and the home gateway is the logical place to do this. A purpose-built home router is another alternative. By running a proxy server on the home gateway, all computers and information appliances within the home can share the same IP address and run a full set of applications. Proxy servers are quite popular today, even on Windows 95 and Windows 98. This complexity is not helped by the need to update the proxy whenever a significant new protocol comes into use on the Internet.
Some proxies are unable to handle PPTP tunnels for telecommuting, for example.
A far simpler approach is to provide Network Address Translation on the gateway. This capability is present in Windows 2000 and will become available for Windows 98. Unlike a proxy server, which runs at the Application Layer of the stack, a NAT solution runs at the IP layer and does not need to know about applications settings. Email clients and browsers continue to work without any changes at gateway or client device. However, the vast majority of Internet activities work just fine without a significant load on the home gateway computer.