3 pcs hub adsl modem & DNS

Can some one please help me understand the following configuration
3 pcs + 1 ADSL modem (alcatel) all connected to a HUB. 2 pcs
running XP 1 pc W98. on each pc the DNS is set to 194.90.1.5
and every one is able to brows the internet
how this configuration is working?
And what is this DNS 194.90.1.5 (I am not looking for the meaning of DNS)
Thank you very much in advance