Your site’s domain is “yoursite” in www.yoursite.com. Your site’s domain name is human friendly way computers find your site on Internet.
Behind scenes, there is an Internet Protocol (IP) address that looks like this: 22.214.171.124. The IP address is your website’s real address that computers understand and is associated with “human friendly” domain name you are already familiar with on a name server. Many times you can get to same website by typing in it’s IP address in place of domain name. Below is a chart with a few examples of this. Go ahead and try copying one of these IP addresses into your browser’s address bar and see for yourself. You will go to same place as you would if you typed in domain name!
When you type in www.yoursite.com, your request goes out on Internet to large servers called routers. The routers contain databases of domain names and IP addresses. Your request moves up chain of routers until it finds one that “knows” IP address for domain you are requesting. This process is known as “resolving” domain name. Essentially, you are looking for a computer that knows how to match up Domain name that you typed into browser to it's IP address.
Once your request is resolved (matched to an IP address), request is sent through various routers to server that contains your website’s files. That server is web server. The web server then processes request and sends results back to your web browser as a web page.
Of course, it isn’t really necessary that you understand all details of domain resolution. What is important is that you understand that your domain is a unique name that is associated with your website’s location on Internet, and your website’s location is a virtual location known as an IP address.
Registering a domain is exceptionally easy to do. When you register your domain, you specify length of time you wish to reserve it for. Typically longer term, less annual cost to you. The most difficult thing for most entrepreneurs is determining which domain to register. Many of best domains are already taken, so it takes some creativity to come up with a memorable domain that is not taken and is still applicable to your business.
As a general rule, if you are a U.S. company it is highly recommended that you pick a “.com” address. There are many more domains that are available in .net and .org flavors, but if you are trying to establish a brand that will be perceived by your visitors as a leadership brand, you really need to have a .com address.
Back in late ‘90s individuals and corporations began buying up all “good” domains. They did this on speculation that domains they were purchasing for $30 would one day be worth tens of thousands of dollars. Certainly a few lucky entrepreneurs made a quick buck this way, but generally speaking cost of purchasing thousands of domains quickly outweighed benefit of selling a few at an extraordinary profit. Many of these companies have since dumped a large portion of their inventory, and it is once again available on open market.