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The more common DSL router is a standalone device that combines the function of a DSL modem and a router, and can connect multiple computers through multiple Ethernet ports or an integral wireless access point.
A router routes while a modem modulates! Modem is short for modulator-demodulator. A modem is about line/channel coding - very low level details which most do not care about but that is what really makes the thing fly! It deals with low level encoding etc - A/D conversion, signal processing etc.