IP (Internet Protocol) - An IP address is a fascinating product of modern computer technology designed to allow one computer or other digital device to communicate with another via the Internet. IP addresses allow the location of literally billions of digital devices that are connected to the Internet to be pinpointed and differentiated from other devices. 
An IP address consists of four numbers, each of which contains one to three digits, with a single dot '.' separating each number or set of digits. Each of the four numbers can range from 0 to 255. Here's an example of what an IP address might look like: This innocuous-looking group of four numbers is the key that empowers you and me to send and retrieve data over our Internet connections, ensuring that our messages, as well as our requests for data and the data we've requested, will reach their correct Internet destinations. Without this numeric protocol, sending and receiving data over the World Wide Web would be impossible. IP addresses can be either static or dynamic.

Static IP - Static IP addresses never change. They serve as a permanent Internet address and provide a simple and reliable way for remote computers to contact you. Static IP addresses reveal such information as the continent, country, region, and city in which a computer is located; the ISP (Internet Service Provider) that services that particular computer; and such technical information as the precise latitude and longitude of the country, as well as the locale, of the computer. Static IP addresses are generally preferable for such uses as VOIP (Voice over Internet Protocol), online gaming, or any other purpose where users need to make it easy for other computers to locate and connect to them. Static IP addresses are considered somewhat less secure than dynamic IP addresses, since they are easier to track for data mining purposes. 
Dynamic IP - Dynamic IP addresses are temporary and are assigned each time a computer accesses the Internet. They are, in effect, borrowed from a pool of IP addresses that are shared among various computers.
Some Special IP Address :

Address Block                                                           Present Use                                                          “This” Network                                                        Private-Use Networks                                                        Public-Data Networks                                                        Cable Television Networks                                                        Reserved, Subject to Allocation                                                      Loopback                                                    Reserved, Subject to Allocation                                                Link Local                                                Private-Use Networks                                                Reserved, Subject to Allocation                                                    Reserved, Subject to Allocation                                                    Test-Net                                                6to4 Relay Any cast                                                Private-Use Networks                                                  Network Interconnect Device Benchmark Testing                                            Reserved, Subject to Allocation                                                      Reserved for Future Use                                                      Multicast, Commonly used in Multiplayer Simulations and                                                                                             Gaming and for Video distribution.

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