Chances are, you may have registered for a domain name (example:  mysmallbusiness.com) some time ago.  You may even “own” a few domain names and perhaps one of these domain names is where your current business runs.

I’d like to provide you a quick introduction on how domain names work.  As with my prior articles along similar lines, my goal is to give you, the insanely busy small business executive a simple mechanism for understanding this – so you know what’s actually going on.  By the end of this article, you should be able to impress most of your non-technical friends and family (and maybe even a few technical ones).  As common is the topic is, most people really don’t understand how it actually works under the covers.  After this article, you will.

Understanding Internet Domain Names
 

1. IP Addresses:  To really understand domain names, you need to have a quick grasp on IP (Internet Protocol) addresses.  This is not that hard.  Basically an IP address is a unique way to identify every single machine/server/device on the Internet.  Public IP addresses are basically those that can be “reached” by anyone connected to the Internet (kind of like a public phone number can be called).  All public Internet web servers have a public IP address.  IP addresses usually are represented in “dotted” form like this:  216.128.28.18 (this is the IP address of the server that runs HubSpot, my software company’s website).  So, fact is, if you knew what the IP address of your favorite website was, you could use it to the site within a browser.  You can try it out by typing 216.128.28.18 into a browser and see what happens.

2. Why We Need Domain Names:  The reason for domain names is very simple.  Carbon-based life-forms (unlike computers) tend to have a difficult time remembering something like 216.128.28.18.  Our brains are not wired that way. We are much more likely to remember a word (or set of non-random characters).  So, all a domain name really is is an alias or pseudonym for an IP address.  If it weren’t for this need for human convenience, we probably wouldn’t have domain names.  As you might expect, if an IP address has to be unique, than a domain name has to be unique too.  In most cases, all a domain name is is a “pointer” to an IP address.  That’s like saying, when I type “hubspot.com” what I really mean is 216.128.28.18.  And the magic that is the Internet figures it out.

3. Top Level Domains:  As it turns out, instead of having domain names (IP address aliases) that are just simple words, the powers that be (people much smarter than you and I) decided that it might help to “organize” the way names are created to make things easier.  So, what they decided is that we’ll have a set number of “top level” domain names (TLDs).  The most common examples are “.com”, “.net” and “.org”.  All domain names must end in a known top-level-domain in order to work.    So, you can’t have mynameis.joe as a domain because “.joe” is not yet recognized as an official top-level domain.

4. Why You Need A Registrar:  So, a set of organizations manages one or more of the top-level domain names (like .com).  What they do is ensure that one (and only one) second level domain name is assigned within each top-level domain.  So, we can have hubspot.com, hubspot.net and hubspot.org.  All of these are different domain names as all are within a different top-level domain name.  Now, to keep things somewhat manageable, you can’t go directly to all knowing, all registering entity that manages all these domain names.  They have “agents” that act on their behalf.  These domain name “registrars” help you “register” a domain name and do something useful with it (like “point” it to an address of your choosing).

 

5. Renting vs. Buying:  Though many people talk about buying a domain name, what they are really doing it is renting it for a period of time.  There are terms and conditions around the rental (which, as long as you pay your annual rental fee, you get to continually “control” which IP address the domain points to – which is all you really need and care about).  Once you have an agreement with an official registrar, all you have to do to keep it yours is make sure you keep paying the annual fees.    (The general market rate for this is about $10-$20 annually)

6. Last Step, the DNS Servers:  Now, it doesn’t really end here.  Just like an organization controls the top-level domain names (.com, .net and others), now you control the second-level domain.  So, let’s say you and three buddies decide to start a strategy consulting company (Four Aces Consulting).  You go to a registrar and register “fouracesconsulting.com”.  What this means is that you can now control all sub-domains of the primary domain “fouracesconsulting.com”.  The most common sub-domain is “www” (so you would have www.fouracesconsulting.com”.  In order to accomplish this final step, what you need is DNS (Domain Name Service).  This piece of software (often provided by your registrar) is what lets you define all the sub-domains from your primary domain which computers they should go to.  So, you might have www.fouracesconsluting.com for your website, you might have blog.fouracesconsulting.com for your blog and you might have mail.fouracesconsulting.com for your email server.  These may all be running on the same server – or they may not.  The DNS software is what lets you define all the sub-domains you want to use and which IP address they should point to.  Important note:  You also get to define the “default” sub-domain (i.e. when users just use “fouracesconsulting.com” which by general convention should act the same as www.fouracesconsulting.com).

Quick summary:  Web servers and other devices need a unique address so we can “find” them on the Internet (like a phone number or physical mailing address).  The standard way to assign these is an “IP” address which is really hard to remember.  So, domain names help us by providing a nick-name or alias for the IP address.  The result is that you can type in www.hubspot.com, the Internet figures out that this really means IP address 216.128.28.28 and you don’t have to know the difference.

Now that we’re through the technical bits, in a future article, I’ll talk about the strategic side of domain names (how to pick one, whether it must be “.com” to be worthy, etc.).  If you have questions around this topic, leave a comment on this article and I’ll try to address these in the next article.

-Dharmesh Shah