The given configuration will allow three users to Telnet into the router at the same time. The line vty 0 2 command specifies a range from 0 to 2; therefore, three simultaneous Telnet sessions are allowed on this Cisco router. The commands in the exhibit can be explained as follows:

Router(config)#line vty 0 2 (determines which of the five possible terminal lines are being configured. In this case, they are lines 0 through 2. It also determines the number of lines available, in that any line with no password configured will be unusable.)
Router(config-line)#login (specifies that a password will be required)
Router(config-line)#password guest (specifies the password)

The default configuration allows five simultaneous Telnet sessions on the Cisco router. For the default configuration, you would issue the vty 0 4 command in global configuration mode.

You must configure a password when enabling a router for Telnet access. Without a password, the login access to the router will be disabled and you will receive the following error message if you try to Telnet to the router:
router# telnet 10.10.10.1 Trying 10.10.10.1 ... Open Password required, but none set [Connection to 10.10.10.1 closed by foreign host]