The fact that a software firewall can be disabled by e.g. a virus is enough to make me get an hardware firewall.
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if your running a n*x box as a firewall for example with ipchains/iptables/whatever as your firewall, you have to make sure that the box running the firewall is secure.
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^^ That's still a software firewall.
When I'm refering to a hardware firewall, i mean a box from cisco or the likes.