Hardware

Why a computer needs Hardware, and its difference between Software
Computers need Hardware beacause it is the part of the computer system that help to make it up. Hardware is the part of those systems that you can touch, like disks and keyboards, whereas Software is a part of the computer which is untouchable, like ideas and symbols.

Definition of Hardware from:
http://searchcio-midmarket.techtarget.com/sDefinition/0,,sid183_gci212228,00.html
"In information technology, hardware is the physical aspect of computers, telecommunications, and other devices. The term arose as a way to distinguish the 'box' and the electronic circuitry and components of a computer from the program you put in it to make it do things. The program came to be known as the software."

An example of Input, Output, Processing and Storage
Input - A person types data into a database system by means of a keyboard
Output - The keystrokes being entered are immediately shown on the typist’s monitor so she can see what is being entered.
Processing - The keystrokes being entered by the typist is converted into ASCII format that the computer can understand.
Storage - The raw data gathered during the tests may be kept in storage in case a more clever way of processing the data comes up in the future.
http://www.teach-ict.com/as_a2/topics/input%20processing%20output/input_process_output/

Network Hardware
Networking hardware typically refers to equipment facilitating the use of a computer network. Typically, this includes routers, switches, hubs etc.