I thinking about adding an external device for backups and storage via home network. What is the difference between a home server (hp) and and external hard drive of the same capacity (500 gb)? Do the external hard drives have an ethernet port on them to connect to network? Cost is a factor but willing to go the distance for what is right. I want to be able to access the external device weather it be a home server or hdd through network connection. I don't want to have to go through, let's say computer A, to access device. I want all computers on network to have access independently to the device. Thanks.

All external HD's I've seen connect with a USB cable to a specific computer. Looks like you want a server.

I have 3 machines on a network, use my wife's XP machine that has 2 extra HD's for backup. Try to backup critical stuff daily.