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IP addresses of 32 bits theoretically allow for more than 4 billion unique addresses, but in practice the actual number is much less. Certain ranges are reserved for special purposes so the number of available IP addresses is limited. Web sites can get around this limitation by using shared hosting or virtual servers. Rather than using one server for one web site, shared hosting allows several sites (sometimes hundreds) to be hosted on the same server. Each of these sites has the same IP address. They are uniquely identified by their domain name (e.g. mydomain.com).

There are plans to expand the number of IP addresses with the introduction of version 6 (We currently use version 4) of the Internet Protocol. IPv6 has IP addresses which are 128 bits wide. This provides an almost unlimited number of unique addresses, but will take several years to implement because of the heavy cost of upgrading the Internet infrastructure.

Shared hosting solves the problem of limited IP addresses for web sites, but there is also a need for IP addresses for each personal computer which connects to the Internet to browse the web or send email. Rather than assign each PC a unique IP address, Internet Providers can use a system of 'dynamic addresses'. This means that each time you connect to the Internet through a dial-up or DSL modem you are assigned a different IP address.

So far we have been discussing how to use a web hosting company to host a web site, but there is no reason why you can't host a site on your home computer. The biggest technical difficulty for most people, though, is that they connect to the Internet using a dynamic IP address.

Dynamic addresses make it difficult to host a web site from home. Since the IP address is constantly changing nobody would be able to find your site unless you somehow notified them of your current IP address. There are dynamic DNS services, however, which allow you to assign a domain name to a site with a dynamic IP address. Each time you are assigned a new address your computer automatically notifies the service, which in turn updates its DNS (Domain Name Server).

Hosting a web site on your home computer, however, may not be a good idea. The computer has to operate server software and needs a high speed Internet connection. Your home Internet connection is probably a lot slower than those used by hosting companies so your web pages may load slowly – especially if they have a lot of graphics. If you have a small personal site with few visitors, though, it may be feasible to host your own site. Dynamic DNS is available as either a free or subscribed service.