Classless Inter-Domain Routing
An IP address is interpreted as composed of two parts: a network-identifying prefix followed by a host identifier within that network. In the previous classful network architecture, IP address allocations were based on the bit boundaries of the four octets of an IP address. An address was considered to be the combination of an 8, 16, or 24-bit network prefix along with a 24, 16, or 8-bit host identifier respectively. Thus, the smallest allocation and routing block contained only 256 addresses—too small for most enterprises, and the next larger block contained addresses—too large to be used efficiently even by large organizations. This led to inefficiencies in address use as well as inefficiencies in routing, because it required a large number of allocated class-C networks with individual route announcements, being geographically dispersed with little opportunity for route aggregation.
History of the Internet
Over time, after consultation with the IANA, the IETF, RIPE NCC, APNIC, and the Federal Networking Council (FNC), the decision was made to separate the management of domain names from the management of IP numbers. Following the examples of RIPE NCC and APNIC, it was recommended that management of IP address space then administered by the InterNIC should be under the control of those that use it, specifically the ISPs, end-user organizations, corporate entities, universities, and individuals. As a result, the American Registry for Internet Numbers (ARIN) was established as in December 1997, as an independent, not-for-profit corporation by direction of the National Science Foundation and became the third Regional Internet Registry.