Networking is about meeting people you know who can vouch for your past performance and connect you with people you don't know.
After writing The Best Job-hunting Secrets of All Time, and reading the comments, Lou Adler summarized job-seekers' attitudes towards networking. His findings led him to the conclusion that 20% of job-seekers find networking necessary, appropriate, and comfortable. Another 20% find it necessary, but uncomfortable. The rest are either not doing it, or doing it wrong.