diff --git a/doc/README.xnet b/doc/README.xnet
index 3fe09133a0..e62ff06e43 100644
--- a/doc/README.xnet
+++ b/doc/README.xnet
@@ -1 +1,28 @@
-TODO by Dmitry Yemanov
+XNET - new local protocol implementation (win32)
+------------------------------------------------
+
+Firebird 2.0 has replaced the former (often referred to as IPC or IPServer)
+implementation of the local transport protocol with a new one, named XNET.
+
+It serves exactly the same goal - provide an efficient way to connect to the
+local server (without a remote node name in the connection string) - but it's
+implemented differently, in order to address the known issues with the old
+protocol. Generally speaking, both implementations use shared memory for
+inter-process communication, but XNET eliminates usage of window messages to
+deliver attachment requests and it also implements another synchronization
+logic.
+
+Advantages of the XNET protocol over IPServer:
+
+  - it works with Classic Server
+  - it works for non-interactive services and terminal sessions
+  - it doesn't lock up when using a few connections simultaneously
+
+From the performance point of view, they should behave similarly, although
+XNET is expected to be slightly faster.
+
+As for disadvantages, there's only one - implementations are not compatible
+with each other. It means that your fbclient.dll version should match the
+version of the used server binaries (fbserver.exe or fb_inet_server.exe),
+otherwise you won't be able to establish a local connection (a TCP localhost
+loopback will do the trick, of course).