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A modem takes the coaxial cable and translates into ethernet, in simple terms. And yes, you would need an internet plan. If you are just getting it to hook up to your PC, and not for WiFi mainly, you could make do with the one that your ISP gives you.

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Some ISPs customer service can be difficult to deal with when you buy your own modem. I had one that was awesome and easy to get setup and one that was just awful because I wasn't using their modem.

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