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In the Wikipedia article on CIDR, it says

The Internet Engineering Task Force introduced CIDR in 1993 to replace the previous addressing architecture of classful network design in the Internet. Their goal was to slow the growth of routing tables on routers across the Internet, and to help slow the rapid exhaustion of IPv4 addresses.

How does allowing the subnetting, or splitting up host addressing, "slow" the growth of IPv4 down?

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To my understanding, CIDR (or subnetting) is simply subdividing a network into subnetworks for the purposes of security (think broadcasting) or management (different departments of a company), etc., just like partitioning a hard drive for files management. I do not see how CIDR / subnetting "slow the rapid exhaustion of IPv4 addresses". Correct me if I am wrong or if I missed some concepts.

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"slow" the growth of IPv4 down? It actually sped the growth of the IPV4 network up by flushing huge blocks of unused addresses out of the Class A and B address spaces. –  Fiasco Labs Feb 27 '12 at 5:37
    
exactly my point.. that is why I am question this quote in wikipedia: "help slow the rapid exhaustion of IPv4 addresses" why? –  KMC Feb 27 '12 at 6:22
    
Take a for instance, you give GE a whole class A address range. They are never going to field 16 million computers. Given NAT at remote offices to keep internal networks on private addresses, they're going to use even less (no need to expose systems on the public network that need no public access). So if they only need 100,000 public addresses for servers, gateways and other systems, then you have 15.9 million addresses sitting there gathering dust. Enter CIDR and you can provision out these addresses to live users who need them thus slowing the exhaustion, extending the life of IPV4. –  Fiasco Labs Feb 27 '12 at 16:40
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CIDR allows IP addresses to be allocated to institutions more efficiently. Under the classful system, fully half the address space was reserved as 128 class A, 16.8 million-address networks. Very few institutions have need for that many addresses, and under the classful system, there was no way to break those class A networks down into smaller chunks that could be assigned to different institutions. Even the biggest Fortune 500 companies (that aren't telcos/ISPs) would only have several hundred thousand addressable devices, so millions of addresses would go to waste for each institution that had a class A.

Take, for example, Ford Motor Company (the American car maker). Ford was assigned a class A network back in the day. So Ford has 16,777,216 addresses allocated to it, even though it only has 160,000 employees worldwide. Does Ford really need over 100 publicly-routable addresses per employee? Probably not, since they're not even a tech company, much less a telco or ISP or other network provider. I could maybe believe 10 addressable devices per employee MAX, which means Ford is wasting over 15 million addresses. Unfortunately Ford was "grandfathered in" when CIDR went into effect, so they're still wasting those addresses. But thanks to CIDR, there were only a couple dozen grandfathered-in wasteful class A allocations, and most of the rest of what was previously the "class A" network space (remember, this was half of all IPv4 address space) has been doled out to Regional Internet Registries (RIRs) around the world, and broken down into smaller blocks to be assigned in APPROPRIATELY-sized chunks to institutions that needed it.

Remember that under the classful scheme, ½ of the entire IPv4 address space was reserved as 128 class A networs, ¼ was reserved for class B networks, ⅛ was reserved for class C networks, 116 was reserved for class D (multicast), and the last 116 was reserved for class E (undefined future use).

Because there was no way to break the class A half of the address space down into smaller units that could be assigned to different institutions, the numbering authorities couldn't in good conscience allocate any of the class A networks to anyone except perhaps the biggest telcos and mega-ISPs. And the reasonably-sized chunks (classes B and C) only made up ⅜ of the address space, so all of that would have been depleted very quickly.

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My question has yet to be answered. To my understanding, CIDR (or subnetting) simply subdivision a network into subnetworks for the purposes security (think broadcasting) or management (different departments of a company) etc. Just like partitioning a hard drive for files management. I do not see how CDIR / subnetting "slow the rapid exhaustion of IPv4 addresses"? –  KMC Feb 27 '12 at 6:20
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@KMC I think you're missing the fact that before CIDR, there was no way to break half of the total IPv4 address space (the 128 class A networks) into reasonably-sized chunks that could be assigned to a single institution without massive waste. Back in the classful days, half of the address space was reserved for class A's, and each class A could only go to a single company. I've updated my Answer to try to make this more clear. –  Spiff Feb 27 '12 at 7:19
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Prior to 1993 a company could not be allocated only the IP addresses that it needed. If someone wished to be allocated publicly-routable IP space, the smallest amount that was available was an entire class C network. The introduction of CIDR allowed companies to be allocated only the IP addresses that they needed and were going to use. So in this sense it slowed the growth of IPv4 because every company that was being allocated IP space did not have excess IP addresses just hanging around that were allocated but not in use.

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Company to purchase an IP range? I don't get it. My small company would purchase an internet plan which gives it a single IP to connect one ethernet cable to a router. The router than partition the networking into as many as 254 computers which are given different IP addresses (192.168.1.x) and if any computer lookup their own IP on the internet, they have their own unique IP address different. When did company ever buy a range of IP's? –  KMC Feb 27 '12 at 7:22
    
correct now you can purchase only one IP and use NAT to connect as many devices as you would like. This only refers to public IP space on the internet for fully routable devices. –  Mark S. Feb 27 '12 at 7:25
    
@KMC NAT is another factor slowing the exhaustion of the publicly-routable IPv4 address space, but it is not the only factor. To most network protocol engineers, NAT is evil — a terrible solution, because it violates the End-to-End Principle that is so core to how the Internet ought to work. –  Spiff Feb 27 '12 at 7:38
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