A network device is a device that you can run your app on over Wi-Fi or other network connection. For iOS devices, you only connect the device to your Mac using a Lightning cable when pairing. For Apple TV, your Mac and the device just need to be on the same network when pairing.
Note: Running an app on a network device requires Xcode 9.0 or later running on macOS 10.12.4 or later, and on the device, requires iOS 11.0 or later, or tvOS 11.0 or later.