Priests are a versatile class. Other classes tend to have one area of healing excellence; priests can do well in almost any role. Holy specced priests will do best as area-of-effect healers; while Discipline specced priests excel as single target healers. As a general rule, holy priests will be assigned to raid heals and a discipline priest will be healing the tank or off-tank.
With dual specs now available, some healing priests will go with a dual spec of discipline and holy and will switch depending on the needs of the raid and the demands of the fight. Still, a shadow spec can make farming faster and easier and many priests will pick one healing specialization and take shadow as their second spec.
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