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Unique Visitors

OK I have a major question. What exactly is a "Unique Visitor"? I see two different definitions & both are unclear to me.

First definition: The Counter & Live Stats service uses a combination of IP address data and a browser cookie to determine if the visit is unique.

Second Definition: a single specific person that is viewing your site.

I need to know what this is for sure because I need to be able to generate a monthly report on traffic to our website. Any help on a easy to understand explanation on what a "Unique Visitor" is greatly appreciated. Thanks in advanced.

Re: Unique Visitors

The problem is that you cannot get a true count of "unique" visitors. If I visit your site from both my laptop using my home wifi and my phone using my 3g connection I am, logically, a single unique visitor but I am the only person who knows that both devices belong to me as there are no signals that the hit counter can use to tie them both to me.

The second definition is the "true" one but the first definition is the "measurable" one.