Getting Your Network Information Together
Windows XP Home is designed mostly for standalone (non-networked) PCs. However, it does support basic networking functions because more and more folks are setting up little networks in their homes or home offices. If a network interface is detected during the installation, the basic networking components are installed. The basic components are the Microsoft Networking Client and the TCP/IP protocol. You're able to configure networking components during installation, but you aren't offered the chance to manage workgroup or domain membership during installation.
If networking components are installed, Windows XP Home is automatically a member of the MSHOME workgroup. You can change the workgroup membership, but Windows XP Home cannot be a domain client. You must use Windows XP Professional if you need a domain client. A domain client is a system which is a member of a centrally controlled and secured network environment.
You should leave the network component configuration set to its defaults and change the settings after the installation is complete. They are set by default to seek out a DHCP server to obtain the necessary (and tedious) IP configuration details that earlier operating systems made you enter manually. (Details about post-installation manual configuration of network components are discussed in Part IV, "Networking.")
If you are upgrading a system that already has network connectivity, Windows XP Home retains that connectivity, but only if that connectivity is centered around a workgroup. Otherwise, it becomes a member of the MSHOME workgroup by default.