IP communication between hosts uses one of three transmission methods: unicast, broadcast, or multicast.
If there is a group of five different hosts, and three wish to view an identical video stream, multicast would be the best transmission method to be used. Unicast would result in inefficiency by using triple the bandwidth that would be required. An IP directed broadcast would flood the video stream to hosts that are not expecting to receive it, wasting their network cards resources.
An IP directed broadcast is a feature that is not enabled on Cisco routers by default, as it can open a distributed denial of service attack vulnerability.
Multicast sits in the middle between unicast and broadcast. It optimises network bandwidth and conserves resources by allowing traffic to flow to selective hosts that are part of a group. It is known as a one-to-many method of transmission, only one data packet needs to be sent across a link and the data is replicated across the link to where it is required along the multicast distribution tree, or MDT. These data packets are known as a stream that utilise a special destination IP address known as a group address.
The server for the multicast only utilises one session, with hosts selectively requesting to receive this stream. These hosts are known as receivers.
Multicast utilises Internet Group Management Protocol (IGMP) for operation within a layer 2 network. For layer 3 networks multicast utilises a technology called Protocol Independent Multicast (PIM).
Common devices that use multicast are Cisco TelePresence, real time video, IPTV, stock tickers, distance learning, video and audio conferencing, and music on hold.