What is the difference between addon domain and subdomain

An addon domain is a domain name that points to its own folder within public_html and appears like a separate website from your primary domain and this type does require you to register the new domain name before you can host it.

A subdomain is an extension of your primary domain name (example subdomain.primarydomain.co.za), a subdomain doesn't need to be registered before you can host it as it is connected to the primary domain name.

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