It's simply a "pass-through". Just like the electricity goes from the wall, into the strip, then into your computer.
You would have the ethernet go from the modem, through the strip, into your computer. If you have a router, it would go from the router, into the strip, then into your computer.
It it there so that if the modem (phone or cable line) would get hit by lightning and it would pass into the router, it would at least save the computer (in theory of course). Personally I've never used it.
Also, ist it ethernet for sure? Some have phone line size plugs (I think they are called RJ-11 where an ethernet is an RJ-45).