CPE (Customer Premises Equipment) and routers are both networking devices used to connect computers and other devices to a network or the internet. However, there are some key differences between CPE devices and routers in terms of their design, capabilities, and typical use cases.
A CPE is a terminal networking device located on the customer's premises. It connects to a telecom provider's broadband service and provides connectivity for the customer's local area network (LAN). Common examples of CPE devices include DSL and cable modems, fixed wireless terminals, and optical network terminals (ONTs).
In contrast, a router is a general-purpose network device that connects multiple networks together and routes traffic between them. Routers operate at layer 3 of the OSI model using logical addressing. Home and small office routers typically provide connectivity between a local network and a wide area network like the internet. Larger enterprise routers route traffic in corporate networks and across the internet backbone.
CPEs act as the endpoint of a broadband service, providing wired and wireless access to a single local network.
Routers interconnect multiple networks and intelligently route traffic between them based on IP addresses.
CPEs have WAN interfaces to connect to an ISP and LAN interfaces for the customer's network. Popular interfaces include DSL, DOCSIS cable, fiber ONT, and fixed wireless.
Routers can have any mix of interface types to connect to multiple LANs, WANs, servers, and network segments. Common interfaces are Ethernet, serial, fiber, cellular, and others.
CPEs focus primarily on access, acting as a modem, wireless access point, firewall, and basic router for a small network.
Routers provide more advanced layer 3 functions like dynamic routing, traffic shaping, VPN access, security services, and WAN interface management.
CPEs are designed for small home and office networks with a limited number of devices.
Carrier-grade and enterprise routers can handle millions of routes and terabits per second of traffic across thousands of interfaces.
CPEs are "zero-touch" devices, preconfigured by the ISP for simple plug-and-play installation.
Routers have robust management platforms with CLI, APIs, logging, monitoring, alerts, and automation capabilities.
While CPE devices have basic routing capabilities, routers are specifically designed for intelligent traffic routing and network interconnection tasks. For home and small office settings, integrated router/CPE devices with 4G/5G, fiber, cable, or DSL interfaces are popular. But for large corporate and service provider networks, dedicated high-capacity routers are required. Understanding the capabilities and best uses for CPEs vs routers is important for selecting the right network gear.