Transfer of data, or data transmission, is the transfer of data over a point-to-point or point-to-multipoint communication channel. Analogue transmissions are either represented as a baseband (sequence of pulses by means of a line code) or a passband (a limited set of continuously varying wave forms) transmission, using a digital modulation method. The passband modulation and corresponding demodulation is done by the modem equipment.
In order for data to traverse the network environment, it needs to go through a process called encapsulation and subsequently de-encapsulation. For example: A user wants to log into a remote host, and sends the log in data. The data starts at the Application Layer (Layer 7 of the OSI Model) as a "packet" containing the log in data. This packet goes down the different layers until it hits the Transportation Layer (Layer 4), where it undergoes TCP segmentation (assuming the application layer protocol uses TCP). TCP uses segments to determine if the receiving host is really receiving the data, it performs what's called the three-way handshake where the host sends the request, the peer sends and acknowledgement, then the host sends an acknowledgement of the acknowledgement. If TCP can't be used, the packet is formated for a UDP connection, and it doesn't check whether or not the receiving host is actually receiving the data. UDP attaches a header, containing the sending and receiving host ports, a field with the length of the packet, and checksum to tell the receiving host whether or not the packet was altered in transit. Upon arriving at the Internet Layer (Layer 3), the Internet Protocol (IP) prepares the packets for delivery by formatting them into units called IP datagrams. IP then determines the IP addresses for the datagrams.
Data-Link Layer (Layer 2) protocols format the IP datagrams into a frame and attach a third header and footer to the datagram. The header includes a Cyclical Redundancy Check (CRC) that checks for errors as the frame travels, then the frame gets passed to the Physical Layer (Layer 1). The sending host receives the frames and converts the IP addresses into the physical (MAC) addresses, and then sends the frame out over the network media (ie. fiber patch cables, copper patch cables, ETC.).
On the Network Interface Card (NIC) of the receiving host, the Physical Layer receives the frame and computes the CRC, then sends the frame to Layer 2. The Data-Link Layer verifies the CRC and strips off the frame header and CRC and sends the datagram to Layer 3. Upon reaching the Internet Layer, it determines if the data wants sent in fragments and if so reassembles the fragments, strips off the IP header and passes the datagram to Layer 4. The Transport Layer reads the header and determines which Layer 7 protocol must receive the data. Then TCP/UDP strips off its header and sends the packet to the receiving application. Layer 7 receives the packet and performs the action requested by the sending host.