Summary:
Subnetting an IP Network is done primarily for better utilization of available IP address space, and routing purpose. Other reasons include better organization, use of different physical media (such as Ethernet, WAN, etc.), and securing network resources.

Body:
A subnet mask enables you to identify the network and node parts of the address. The network bits are represented by the 1s in the mask, and the node bits are represented by the 0s. A logical AND operation between the IP address and the subnet mask provides the Network Address.

For example, consider the following IP address and the default Class C subnet mask

192.189.210.078 and subnet mask 255.255.255.0

We can get the network and host portions of the address by using AND operator on the binary equivalent of these addresses as below:

192.189.210.078: 1100 0000.1011 1101.1101 0010.0100 1110 Class C IP Address

255.255.255.000: 1111 1111.1111 1111.1111 1111.0000 0000 Default Class C subnet mask

Performing AND operation, we get:

192.189.210.0 1100 0000 1011 1101 1101 0010 0000 0000

As can be seen above, by using and AND operator, we can compute the network portion of an IP address. The network portion for the IP address given in the above example is 192.189.210.0, and the host portion of the IP address is 078.

There are primarily two types of subnets:
1. Classful subnet masking, and
2. Classless subnet masking.

What we discussed in the previous section is Classful subnet masking. A Subnetmask normally contains the host portion of the bits also. This is called Classless Inter Domain Routing (CIDR). This will enable more networks for a given class of network address. For example, allowing 3 host bits towards subnet portion in our previous IP address, will allow us to offer 2X2X2 or 8 additional subnetworks. Traditionally, all zeros, and all ones subnets are not used, and hence we are left with 6 subnets.

192.189.210.078: 1100 0000.1011 1101.1101 0010.0100 1110 Class C IP Address

255.255.255.224: 1111 1111.1111 1111.1111 1111.1110 0000 Class C subnet mask with 3 additional bits of host portion used for Subnetting.

Broadcast address: 1100 0000.1011 1101.1101 0010.0101 1111 :192.189.210.95

The above is the broadcast address for a given subnet (192.189.210.078). Under Classful routing, the broadcast address would have been 192.189.210.255.

Note that by using Subnetting, we are able to increase the number of networks available within a given IP address. On the other hand, we will be loosing the number of hosts available within a subnet to 24 or 16 hosts per subnet. Again, all zeros, and all ones host addresses are traditionally reserved for other purposes.

CIDR (Classless InterDomain Routing) notation: Subnet mask is also represented as below:

192.189.210.078/27, where 27 is the number of bits in the network portion of the IP address.

Why use CIDR?

Normally, ISPs allocate the IP addresses for individuals or Corporates. The reason being that it is almost impossible to allocate a classful IP address to every individual or a corporate. Using CIDR, the biggest ISPs are given large pool of IP address space. The ISP's customers such as individual or Corporates are then allocated networks from the big ISP's pool. This kind of arrangement will enable efficient management and utilization of the Internet.

Classful addresses can easily be written in CIDR notation

Class A = A.B.C.D/8, Class B = A.B.C.D/16, and Class C = A.B.C.D/24

Where A,B,C,D are dotted decimal octets.

More information on IP subnetworking is available at CCNA tutorial page of simulationexams.com

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