Every server in the world that has access to the Internet has at least one IP address -- to a computer, this is like a phone number. An example of an IP address is 74.125.45.100.
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When you sign up for a hosting account, your host assigns your account a specific IP address on one of their servers. If someone visits a domain name associated with your account, the visitor's computer will find out the correct IP address to which it should connect.
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Usually you'll share an IP address with many other domain names. You can also purchase a dedicated IP address from your web host, and that will be yours alone to use.
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Whichever the case, the important thing is that you have an IP address assigned to your domain, and that all the right nameservers know what it is. (A nameserver is a server that keeps track of which domain names correspond to which IP addresses.)
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How will you know if you need a dedicated IP address? Most websites don't. The most common reason that a website would need an IP address of its own is if it requires an SSL certificate for secure connections to visitors.
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Any business site that processes transactions will definitely need secure connections to work, so a dedicated IP address is a requirement for such sites.
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Watch the tutorial immediately after this one to find out more about SSL certificates.
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This completes the tutorial. You now know what an IP address is, and whether you need a dedicated IP address.