A domain name consists of three levels.  The first level is the word or phrase that makes up the initial domain name.  The second part of the domain name is the extension.  Examples of common extensions include .com, .net or .org.  The third portion of the domain name, called a third level domain name is an optional part.  Like the first level domain name, it consists of a word or phrase to describe whatever webpage it is pointing to.  However, unlike the first level domain name, a third level domain name cannot access a webpage by itself; it must contain the first level domain as well as the extension in its syntax. 

Third level domain names are often used by free web hosting companies to help create distinction among the websites of their customers. 
If third level domain names weren't used, customers would have not be able to access their website in a user-friendly way.  Some third level domains may have the first level domain word or phrase first.  An example is Geocities, where a person would have to include 'Geocities.com' before the third level domain name.  Other third level domain names may have the first level domain name last.  This is the case with Netfirms, where 'Netfirms.com' comes after the third level domain word or phrase.  

For customers third level domains come at no extra cost.  This is in contrast to getting a regular domain name which can range from $6.50 to $35 per year.  Additionally, it may take time before the domain name is active.  This can be up to 7 days, especially if one is transferring a domain name.  Conversely, third level domain names can be setup instantaneously. 

However, third level domains are far from perfect.  Since they require the first level domain name as part of their syntax, they can be quite cumbersome for a website visitor to remember.  A person can pretty much forget about getting traffic if they promote a third level domain name in various forms of offline media, such as in circulars or on business cards.  In these situations it definitely behooves a webmaster to go on invest in a first level domain name of their own.

So, does this mean third level domain names aren't worth anything to webmasters?  Well, if a webmaster uses hyperlink marketing, they can still find value in a third level domain name.  What is hyperlink marketing?  It is simply when a word or phrase is linked to a URL rather than the URL itself.  It is commonly used in emails, viral e-books and on websites themselves.  A potential visitor never even sees the third level domain name, since it is masked by a hyperlinked word or phrase.  And hopefully, they will like the site so much they will bookmark it, rather than trying to remember the full URL. 

In conclusion, third level domain names offer affordability to both web hosting companies and their customers.  They also offer convenience since there's no waiting time associated with their setup.  However, if they are used it's best that they are hidden in hyperlinks, since most website visitors would prefer to type in first level domain names.

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