There are three IP network addresses reserved for private networks. The addresses are 10.0.0.0/8, 172.16.0.0/12, and 192.168.0.0/16. They can be used by anyone setting up internal IP networks, such as a lab or home LAN behind a NAT or proxy server or a router. It is always safe to use these because routers on the Internet will never forward packets coming from these addresses
Subnetting an IP Network can be done for a variety of reasons, including organization, use of different physical media (such as Ethernet, FDDI, WAN, etc.), preservation of address space, and security. The most common reason is to control network traffic. In an Ethernet network, all nodes on a segment see all the packets transmitted by all the other nodes on that segment. Performance can be adversely affected under heavy traffic loads, due to collisions and the resulting retransmissions. A router is used to connect IP networks to minimize the amount of traffic each segment must receive.