Limited Internet Access using Router?

OK, here's the story. If I connect by laptop with a cable straight into the wall socket I have internet access. No problem. But thing is I want Wi-Fi for my iPhone. So today I went out and bought a wireless router. I connected the router to the wall socket and my pc to the router.

Then suddenly my connection says 'Limited Access' ie no internet. I tried connected to the router with my iPhone and even the it connected to the router via Wi-Fi it also got no internet. I did follow the setup steps by going to the ip address they gave to me and setting up a username and password but still no internet.

And as soon as I connect my laptop straight to the wall socket again I have internet. Connect it through the router and suddenly limited access again.

Any tips on how to get the router to work?

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