A subdomain is a part of a web address which is under the main domain name, such as name.example.com. From a technical perspective, even in www.example.com the "www" part is a subdomain given that the fully qualified domain name is only "example.com". Every subdomain can have its own site and records and can also be hosted using a different company if you need to use some feature that's not offered by your current provider. An example for using a subdomain is if you have a business site along with an online store under a subdomain where clients can buy your products. You can even have a forum where they can comment on the products and by employing subdomains rather than subfolders you will avoid any probability of all sites going down if you perform maintenance, or update one of the website scripts. Keeping the websites separated is also more secure in case there is a script security breach.