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My understanding of the two types of modems is pretty basic, but a software modem uses software to run essential parts of the modem, while a hardware modem is entirely run off hardware on the modem. Software modems are usually referred to as winmodems because they use drivers in Windows to run them. This makes them use some system resources, I have heard up to 10% on older computers, but I'm not sure. This also makes tham hard to use with other operating systems such as Linux since drivers aren't readily available. The reason for software modems was to cut pc makers costs. If anyone has any corrections to what I have said or more info, I would like to learn a little more about this too.
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