When you look at a list of available Wi-Fi networks, like the one nearby, there are basically two types: those that are encrypted (with the lock icon) and those that are unencrypted.
If you connect to an unencrypted network all of your traffic is open for all the world to see, unless you take other measures to encrypt it. On such a network, all users can see all other users' traffic. Worse still, other users can hijack your session and communicate with the website you were on as if they were you, or redirect your computer to a site you didn't intend to visit. These attacks, while not strictly new at the time, were made widely known by the release of Firesheep, which made it easy to do.
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