In general, most internal modems (winmodems) being sold now will NOT work with
a cpu without MMX.  I have been successful with a  pentium I-166 with mmx to
use a winmodem, but a pentium I-200 without mmx would not work with the same
modem.  They also seem more sensitive to power surges and lightning - I have
had to replace several that passed the diagnostics but could not execute
dialing the phone thru phone dialer, a basic test of modem function.
I don't see any noticeable difference in speed between internal and external
modems, my connect speeds are in the 49-52500 bps range for 56k modems
regardless of modem type used.  There is a hugh price difference to someone on
a budget, winmodems can often be purchased free or up to about $10.  after
rebates, externals start around $50 and rebates are rare.
The 'plus' my boss likes with external modems is that you can restart the modem
without shutting down your system and rebooting if the modem 'hangs'  for some
reason.

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