Class C address

If the first 3 bits of an IP address are 1 1 0, it is the address of a class C network. The first 3 bits of a class C address identify the address class. The next 21 bits identify the network, and the last 8 bits identify the host. There are millions of class C network numbers, but less than 254 hosts (should be less than 256 but 255 and 0 are reserved). Why? There are 21 bits available to identify the network and only 8 bits available to identify the host.