Wireless paralyzes the moment I download anything

[LanLing]

I use a wireless network for 3 laptops at home. The moment any one of these laptops try to download anything (including streaming movies), wireless completely freezes for all the computers. The download will continue normally, but none of the computers (including the one downloading) can use the wireless in any way, like opening web pages, msn, online games, etc. However in the case of online games or msn, they'll continue to function for 5-10 minutes normally, but eventually will disconnect.
I checked the network utilization rate in task manager, it never hovers above 13-14%, in most of the cases it's more like 0.1-1%. It doesn't matter what speed I'm downloading at, whether it's only 100kbps, or 800kbps (it never gets higher than 800kbps for some reason, yet my friends have reported max speeds like 6-12mbps using the same ISP...), it's like the network automatically devotes 100% of the resources to any download.
Does anyone know how to fix this? It's getting very annoying having to download stuff only when other people aren't using their laptops... I've already tried restarting modem many times.

 

[Cromewell]

You said a couple different things that I want to talk about, so in no particular order:

What kind of router are you using (model number and revision if possible)? Some start to fall down if you have a lot of active connections. This number is typically from 32 (some do start lower) to about 48000, it depends on the router not the speed of your internet connection.

Network utilization in task manager isn't going to be the usage of your external connection. It's the usage of your network interface. So if you have 54Mbps (your standard 802.11g speed) 800kb/s isn't going to flood that by any means. Granted, you never have the full 54Mbps available but enough of it is.

As for your friends getting higher speeds from the same ISP, there are a handful of possible explanations. The most likely is that they are paying for a different speed package than you are. Other possibles are the amount of traffic on your particular branch, line quality, network software you may have installed, your router, etc.