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IP Address Complete Guide: How the Internet Knows Where to Send Your Data

12 min readBy KBC Grandcentral Research Team

Every device on the internet has an address, but IPv4's 4.3 billion addresses ran out in 2011. IANA allocated the last block to regional registries in February 2011 — the internet has been limping on NAT and IPv6 transition ever since. Here's everything you need to understand about how IP addressing actually works.

RouterHost A192.168.1.5Host B192.168.1.6Server8.8.8.8CDN104.16.0.0Every Packet Knows Its Destination

Key Takeaways

  • IPv4 has 4.3 billion addresses — exhausted at IANA level in 2011; we've survived via NAT and private addressing
  • IPv6 has 2¹²⁸ addresses — 340 undecillion, enough for every atom on Earth's surface to have an address
  • Private IP ranges: 10.0.0.0/8, 172.16.0.0/12, 192.168.0.0/16 — never routed on public internet
  • CIDR /24 = 256 addresses; /8 = 16.7 million. The number is bits of fixed network portion
  • Your public IP is your router's address — all devices on your LAN share it via NAT

How IPv4 Addresses Work

An IPv4 address is 32 bits long, written as four decimal numbers from 0 to 255 separated by dots (dotted-decimal notation). Each group of numbers represents 8 bits (one octet). 192.168.1.1 in binary is 11000000.10101000.00000001.00000001.

Every IP address has two logical parts: the network portion (identifies which network the device is on) and the host portion (identifies the specific device within that network). The subnet mask determines the boundary. A mask of 255.255.255.0 (or /24 in CIDR notation) means the first 24 bits are network, the last 8 are host — giving 256 possible addresses (0–255), with 254 usable (0 is the network address, 255 is broadcast).

CIDR Notation Quick Reference

CIDRSubnet MaskTotal AddressesUsable HostsCommon Use
/8255.0.0.016,777,21616,777,214Large ISPs, Class A
/16255.255.0.065,53665,534Medium enterprises
/24255.255.255.0256254Small office / home LAN
/25255.255.255.128128126Split subnet
/28255.255.255.2401614Small VLAN
/30255.255.255.25242Point-to-point link
/32255.255.255.25511Single host route

Private vs Public IP Ranges

RFC 1918 designates three ranges as private — they can be used inside any network but are never forwarded by internet routers. This is why your home network can use 192.168.x.x and so can the coffee shop down the street without conflict. Network Address Translation (NAT) at your router maps all your devices' private addresses to your single public IP when they access the internet.

Class A Private

10.0.0.0/8

16.7M addresses

Used by large enterprises, cloud VPCs

Class B Private

172.16.0.0/12

1M addresses

Docker default bridge network

Class C Private

192.168.0.0/16

65,536 addresses

Home routers (192.168.1.x)

IPv6: Why the Transition Is Taking So Long

IPv6 addresses are 128 bits, written as eight groups of four hexadecimal digits separated by colons: 2001:0db8:85a3:0000:0000:8a2e:0370:7334. Consecutive groups of zeros can be collapsed to :: (once per address): 2001:db8:85a3::8a2e:370:7334.

As of 2024, Google reports that about 45% of its global traffic is over IPv6. The transition is slow because NAT made IPv4 scarcity bearable — there was no urgent crisis forcing enterprises to upgrade their infrastructure. The push is coming from mobile carriers (where NAT is painful) and cloud providers who are running out of affordable IPv4 blocks (trading at $40–60 per address on the secondary market).

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