When two or more Xboxes are hooked together via a cable router, hub, or crossover cable it's called system link. Much like setting up a LAN for PC games but with minimal to no configuration. Microsoft and some 3rd party companies have made their own system link cables but they are just more expensive cat5 cables. Xbox Live account not required.
Programs like Xbox Connect and Xlink Kai use the system link function and trick an Xbox into thinking someone across long distances are in the same room. This method of online gaming is a free alternative to Xbox Live and a last resort for those that have been banned from the service due to modding or for breaking the Terms of service.
sorry, not sure if this term is used for anything else