A Windows Home Server (WHS) is a consumer server {See diagram A above} option designed for use with multiple computers connected in the home. A Home Server allows you to share files such as digital photos and media files, and also allows you to automatically backup your home networked computers.
Through Windows Media Connect, Windows Home Server lets you share any media located on your WHS with compatible devices. Compatible devices in this case basically means Windows Seven, Vista or XP computer systems, media center devices, Windows Mobile-based devices, and even your Xbox 360 console gaming system.
The server itself requires only an Ethernet card and at least one Windows XP or Windows Vista or Seven PC.
Through the Home Server Console, which is the software you install on the connected PCs, you can set all your server options including backup details, file-sharing options so you don't need a monitor, video adapter, or keyboard and mouse after it is setup since all access is done remotely through a connected PC.