So I just found out about BlueTooth PAN and I am not clear on what it does?

So I have my iPhone and MacBook Air and on my MacBook Air I selected the Bluetooth PAN network option in the network tab of the system preferences menu, and hit setup new device and selected my iPhone, now when I hit connect in the Bluetooth PAN menu it immediately comes up with a notification (I am running OS X Mavericks btw if that makes a difference) which says "Network Unavailable" make sure network access is enabled. Where does it want me to enable it!!! is it on my iPhone or my mac???? PLEASE HELP!! I know I cannot be the only Mac user to have ever seen this and be curious, somebody must have a solution, also btw my iPhone is a iPhone 4 running iOS 7 if that makes a difference...

I realize this is hind site, by why would you go over an hour without saving? The power could have gone out or the dog tripped over the power cord. Something to keep in mind for the next project.

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