There are two groups of computers that make up the physical presence, the data network container and the application hosts. The network container is the thing that carries data from customers to the customer services and back again.
The network contains hosts. The container metaphor is used because it is suitably vague enough to bridge the gap between what we are actually creating and what the English language is capable of describing: containers are things that objects are shoved in, such as a freight container and a chemical container.
The network container is the thing that carries data from customers to the customer services and back again. The container is all the network paraphernalia that lets LIC services be part of the Internet. It carries every conversation between a client and a server. When the network container is happily humming along it rarely needs to be changed.
The network container is made from hardware and software. Hardware includes the data communications computers and the racks they are placed in. Software includes programs that run and the configuration that makes programs run the way we want them to do.
A network container is not a network layer. A popular metaphor used to describe the seperation of network services from application services is layering. The idea is that first we build a layer of network services, then on top of that we build a layer of application services. This is taken from the OSI (Open Systems Interconnect) seven layer model which has a network and an application layer (the third lowest layer and the highest layer). This metaphor does not really fit what we are doing because this layered model says nothing about what things are used to make the network. It doesn't care if data is carried by cables, radio waves or carrier pidgeon.
Physical presence and virtual presence do not correspond to hardware and software. The physical presence is not just hardware. Lots of software is required to make the data communication happen. The applications that provide the virtrual presence, on the other hand, are only software.
Wherever you put it. In a coffee shop, in a garden shed or, to be really extreme, as a simulation in a mainframe.