As we learn that all IP addresses have a network and host portion. In classful addressing, the network portion ends on one of the splitting dots in the address. On the other words, Classful addressing divides an IP address into the Network portion and Host portions along octet boundaries. Classful address uses a fixed subnet mask which is /8, /16 and /24, However, classless addressing uses a variable number of bits for the network and host portions of the address. The subnet mask is not fixed for classless addressing system.
The classful addressing system allocated 50% of the available IPv4 addresses to Class A networks; 25% of the IPv4 addresses to Class B; 12.5% of IPv4 addresses to Class C and the remaining 12.5 % Shared both Class D and E. One of the great problem in this system is the waste of IP address which decreases the availability of IPv4 addresses. For example, an organization that had a network with 300 hosts would need to be given a class B network with more than 65,000 addresses wasting 64,700 addresses.
To overwhelm the problem of address reduction and give more organizations access to the internet; classless addressing was introduced by IETF in 1993. In this system, there are no classes, but the addresses are still granted in blocks. In classless addressing system, when an organization or individuals, need to be connected to the Internet; it is granted a block or range of addresses. The block or range varies based on the size of the organization or the requirement of individuals. For example; an individual may be given only two addresses and an organization may be given thousands of addresses based on the number of its requirements.
The IETF know that CIDR is only a temporary solution and that a new IP protocol must be required to overcome the problem of address reduction. In 1994, the IETF began its work to find a successor to IPv4, which ultimately became IPv6.