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A subdomain is an extension of a domain name that normally points to a subdirectory of a web site. Instead of using the URL http://www.thehosted.com/faq/ , which points to the directory faq on my site I could have created a subdomain http://www.faq.thehosted.com/ to point to that faq directory. In this particular example the subdomain is not that more attractive than the original URL, but in some cases a good choice of a domain name and subdomains can result in a big improvement.
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