Many people, including me have troubles using a multisite feature of the recently released WordPress 3.0. I wanted to merge all my sites and to use subdomains (directories) for the address of each site (e.g. my.blog.com instead of blog.com/my). In order to create subdomains, WordPress requires us to create a wildcard subdomain. However, wildcard subdomains are not supported on Bluehost, where my site is currently hosted at. So, after searching for information on the net, I found that there are two workarounds that we can do in order to get our WordPress 3.0 multisite working:
Option 1

Create a subdomain on Bluehost’s CPanel, and point the document root to /public_html/. Then create a new site on WordPress with the same subdomain name as the one you create on the CPanel. Simple!
Option 2

Create a wildcard subdomain (*) on Bluehost’s CPanel, and point the document root to /public_html/. Some people reported that this indeed worked! By creating this wildcard domain, you are allowed to use any domain names you like (visitors can still type in any random subdomains and they will still end up in your main site! Awesome, huh?). But one thing to be aware of is that, you need to set up redirects through ModRewrite or scripting if you don’t want some subdomains to link to your WordPress files.
I personally prefer the first option (and I have tested this, and it works!), since I only use this website for myself and I don’t add new sites on WordPress very often. Well, it’s up to you 🙂
