To the user, netsplits look like a number (usually a large number) of people suddenly simultaneously signing off with a single shared signoff message containing the names of two IRC
servers. Following this, the irc network
on which the netsplit has occured will be split into two distinct sections; depending on which section of the network that the server you are signed on to falls into, you will not be able to see, or talk to, anyone signed on to a server in the other section of the network until the netsplit ends.
Go look at the results of a /map (or glance at the /map of undernet posted in my writeup under /map) and it will become a bit more clear why netsplits happen. As with most irc networks the communication lines between servers on undernet are decentralised but linear-- meaning all it takes is to break one line of communication in a couple of important places, and part of the network is isolated from the rest: you've cut undernet in half and made two little undernets. The two names in the netsplit signoffs, by the way, are the servers between which the link is being severed.
Interestingly netsplits generally happen not because a server or link has actively failed and gone down, but because of a planned, consious corrective action on the part of an ircop on the splitting server.
Specifically, since irc networks are kind of unpredictable, the amount any given server is stressed varies wildly with time.
So, using that /map linked above as an example, let's hypothetically say that at the moment that snapshot was taken, London.UK.eu.Undernet.org was getting a very slow connection from NewYork-R.NY.US.Undernet.org. NewYork was (hypothetically) unusually busy that day, and as a result it was sending information back and forth across its link to London really slowly. Meaning there was a lot of lag between London and NewYork, and thus between everyone on London's side of undernet and everone on NewYork's side of undernet. Lag is bad.
So, the way the people running London deal with this is to disconnect from NewYork (freeing up resources for NewYork) and reattatching to undernet through some other, less-busy hub server (in the process rearranging the /map). Now the strain on the communication lines is more balanced, and the network works better for everyone.. until things change, and another netsplit is needed to fix things again.
Netsplits are like the IRC server equivilent of vomiting. You feel like shit for awhile just beforehand, and it really sucks when it happens, but damn, you feel a hell of a lot better afterward. And most of the time you just can't avoid it.