I was recently asked about whether a router was needed to allow two home computers to access the Internet via one DSL account (similarly, it could have been a cable account). The alternative was that they would use a lower cost hub instead of a router.
My answer, without any hesitation, was to get a router.
A cable/dsl router will let multiple computers share one ISP account with one ISP-assigned IP address. It also will give the computers some protection from attack, since the computers will not have IP addresses that are addressable from everywhere. The computers would have IP addresses on their own private network.
The router provides DHCP services (provide IP addresses) for the home network.
Switches and hubs will let multiple computers access the Internet, also. However, since they do not include a DHCP server (like the router does), the users will have to purchase a second IP address from their Internet Service Provider (additional monthly charge) to get a second computer to connect.
If you look at it that way, the router pays for itself in 5 or 6 months.
Also, the private network provides some additional security. Protected behind a router, the home computers could share files and/or printers. If they use a switch or hub (and, therefore, have public IP addresses) the users should not even think about sharing files or printers between their machines — it is just too hard to do it safely.
I recommend the Linksys WRT54G 802.11g wireless router, even if you don’t plan to use wireless right now. The user interface is very good and so is the manual! The wireless function can be turned off (and I’ve seen another brand where you could not turn it off — big mistake!) and then turned on later if you want to use it. The incremental cost for wireless instead of wired is small.