Can anyone explain what a shard is?

Could someone explain what a shard is?

It keeps cropping up in discussions here and elsewhere, particularly how quiting one game to try another server apparently only puts you on another shard of the same server. I've googled and bing'd but I cannot find any useful information.

Does it means there's a lot more players per-server than the half-dozen ships on the same instance of the world as you? Or does each of the half-dozen ship have its own world that randomly joins with that of another ship based on stuff like time since start and proximity of other ships?

I've certainly shared the same port with ships and crews I couldn't see, but could still speak to. If I stayed on the server would I be able to actually see them later on once they popped out and back into range?