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Solution
Local connections are connections to the database through scripts that run on the same host as the database. Typically, websites use local database connections because they use a database that runs on the same host. The database server name is always "localhost" in this case.
Remote connections are connections to the database through scripts that are not running on the same host. If you e.g. use a merchandise management system on your PC in the office to retrieve data from the database on the web server, you are using a remote connection. If your website uses a database that resides on a server other than the local one, this is also a remote connection. Remote connections use the hostname of the computer where the database is running as the database server name. This is never "localhost" but always a URL or IP address.
For security reasons, most databases do not allow remote connections by default, and for each database user account, a remote connection must explicitly specify which other computer should allow such a connection (wildcards are possible in such cases).
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