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In a formal way hidden terminals are nodes in a wireless network that are out of range of other node or a collection of nodes.
Consider the scenario of wireless networking with three wireless devices -

The transmission range of access point A reaches at B, but not at access point C, similarly transmission range of access point C reaches B, but not at A. These nodes are known as hidden terminals. The problem occurs when nodes A and C start to send data packets simultaneously to the access point B. Because the access point A and C are out of range of each other and resultant they cannot detect a collision while transmitting, Carrier Sense Multiple Access with Collision Detection (CSMA/CD) does not work and collisions occur, which then corrupt the data received by the access point B due to the hidden terminal problem.

IEEE 802.11 uses 802.11 RTS/CTS acknowledgment and handshake techniques over wireless networks to transferring packets that partly overcome the hidden node problem. RTS/CTS is not a proper and permanent solution and may decrease throughput even further, but adaptive acknowledgments from the base station can help too.

Request To Send (RTS)/Clear To Send (CTS) Process
When A has to send data to B, it begins by sending an RTS frame to B to request permission to send it a frame. When B receives this request, it may decide to grant permission, in which case it sends the CTS frame back. Upon receipt of the CTS, A now sends its frame and starts an ACK timer. Upon correct receipt of the data frame, B responds with an ACK frame leading to the closure of data transfer operation between A & B. In case A's ACK timer expires before the ACK gets back to it, the whole protocol is run again.

Network Allocation Vector (NAV)
As an alternative to carrier sensing, the network allocation vector (NAV) is used to inform other nodes how long the current node will need the channel. Any nodes overhearing the NAV know that they have no need of sensing the channel for the time indicated. Since idle sensing of the channel is one of the biggest uses of energy in a network, the NAV reduces the amount of idle sensing required at any nodes which can overhear it, thus saving energy at all nodes in the network.


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