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What is the difference between name-based and IP-based hosting?

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What is the difference between name-based and IP-based hosting?

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IP-based virtual hosts use the IP address of the connection to determine the correct virtual host to serve. Therefore you need to have a separate IP address for each host. With name-based virtual hosting, the server relies on the client to report the hostname as part of the HTTP headers. Using this technique, many different hosts can share the same IP address.

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