Firewalls are placed at every connection to the Internet The firewall can implement security rules. For example, one of the security rules might be:

Out of the 500 computers inside this company, only one of them is permitted to receive public FTP traffic. Allow FTP connections only to that one computer and prevent them on all others.

In addition, the company can control how employees connect to Web sites, whether files are allowed to leave the company over the network and so on. A firewall gives tremendous control over how people use the network.

Firewalls use one or more of three methods to control traffic flowing in and out of the network:

• Packet filtering - Packets (small chunks of data) are analysed against a set of filters. Packets that make it through the filters are sent to the requesting system and all others are discarded.
• Proxy service - Information from the Internet is retrieved by the firewall and then sent to the requesting system and vice versa.
• Stateful inspection - A newer method that doesn't examine the contents of each packet but instead compares certain key parts of the packet to a database of trusted information.
  Information travelling from inside the firewall to the outside is monitored for specific defining characteristics, then incoming information is compared to these characteristics. If the comparison yields a reasonable match, the information is allowed through. Otherwise it is discarded.