Class C addresses were originally intended to support small networks. The first three octets of a Class C address represent the network number. The last octet may be used for hosts. One host octet yields 256 possibilities. After subtracting the all 0s network number and the all 1s broadcast address, only 254 hosts may be addressed on a Class C network. Whereas Class A and Class B networks prove impossibly large without subnetting, Class C networks can impose an overly restrictive limit on hosts.

With 2,097,152 total network addresses containing a mere 254 hosts each, Class C addresses account for 12.5 percent of the Internet address space. Since Class A and B addresses are nearly exhausted, the remaining Class C addresses are all that is left to be assigned to new organizations that need IP networks. The figure summarizes the ranges and availability of three address classes used to address Internet hosts.

Class D Addresses
A Class D address begins with binary 1110 in the first octet. Therefore, the first octet range for Class D addresses is 11100000 to 11101111, or 224 to 239. Class D addresses are not used to address individual hosts. Instead, each Class D address can be used to represent a group of hosts called a host group, or multicast group.

For example, a router configured to run Enhanced Interior Gateway Routing Protocol (EIGRP) joins a group that includes other nodes that are also running EIGRP. Members of this group still have unique IP addresses from the Class A, B, or C range, but they also listen for messages addressed to 224.0.0.10. The 224 octet, designates the address as a Class D address. Therefore, a single routing update message can be sent to 224.0.0.10, and all EIGRP routers will receive it. A single message sent to several select recipients is called a multicast. Class D addresses are also called multicast addresses.

A multicast is different from a broadcast. Every device on a logical network must process a broadcast, whereas only devices configured with Class D address receive a multicast.

Class E Addresses
If the first octet of an IP address begins with 1111, then the address is a Class E address. Class E addresses are reserved for experimental purposes and should not be used for addressing hosts or multicast groups. 

Web Links IP Addressing and Subnetting for New Users http://www.cisco.com/warp/public/701/3.pdf