Proxy vs. VPN: Main Differences 

This guide will help you understand the practical difference and choose the best option for your business’s needs
6 min read
Amit Elia
Amit Elia
Control Panel Product Manager

In this post we will cover:

Define Virtual Private Network (VPN) 

VPNs are typically used to help one encrypt their online traffic so that both their identity and online activities remain anonymous. What VPNs essentially do is change your IP address as well as location so that you can browse content from a local perspective. The three main uses for a VPN include:

  1. Viewing local content from a video streaming platform such as Netflix when abroad. 
  2. Anonymously expressing one’s political or social opinions without endangering oneself when living under an oppressive regime or in a highly conservative society.
  3. Making online purchases from websites such as Amazon and eBay in a way that allows foreign consumers to enjoy local prices and shipping rates (especially in conjunction with a local mail forwarding service). 

Define Proxy Network 

A proxy network serves as a middleman between the client and the target network. When a request is sent out, a proxy server will route the request through a specific network and device. 

One of the main uses for proxy networks is the collection of open-source web data from public domains. This may include things such as competitor pricing and ad campaigns as well as target audience social media sentiment and search engine trends. 

The four main proxy networks that businesses use to route data requests include:

  1. Datacenter: These are typically a group of IP addresses that use a single server through which traffic is then routed. This can be a more cost-effective and quicker option as it requires fewer ‘hops’ in the data retrieval process.  Companies opting for the Datacenter option will need to invest more in R&D in order to build up things such as ‘user emulation’. This is in contrast with ‘Residential proxy networks’ (see below), which require fewer such resources.  
  1. ISP Proxies: These are IP addresses hosted by Internet Service Providers (ISPs). These IPs are hosted in Datacenters for commercial use with the exception that target sites view them as real users. 
  1. Residential: These are real computers/devices belonging to people who have opted into a global network to enable businesses to route traffic through their devices when they are idle. They, in turn, are compensated with free premium memberships to apps and the like, and are able to help create a more competitive digital economy. 
  1. Mobile: These are real 3G and 4G mobile devices through which traffic can be routed. This is one of the most effective and expensive networks on which to retrieve target data. It is best used for mobile-first activities such as Quality Assurance (QA), User Experience (UX)/ User Interface (UI) validation, and the like. 

Proxies Vs. VPNs: Key differences 

Here is a chart to help summarize the main differences between these tools:

Are mainly used by:Companies Private individuals 
This tool serves the purpose of:Enabling the collection of open source information on competitors and target audiences.Helping shoppers, and entertainment/freedom of speech seekers.
One is able to: Circumvent target site blocks, navigate complex site architectures and retrieve Datasets. Bypass geolocation restrictions while maintaining complete anonymity. 
The main advantages include:Easy to scale operations up and down on a commercial level, easy to integrate with in-house software, while reducing development resources necessary in order to carry out data collection jobs.Attaining complete privacy by the non-disclosure of your IP address, gaining a new level of security vis-a-vis internet activity encryption, and freeing you from GEO-related restrictions and censorship. 
In terms of options:There are many types of Proxy networks to choose from as well as different types of proxies (forward proxy; reverse proxies; SOCKS 4/5 proxies etc).All VPNs are fundamentally the same, with the exception of the fact that some are free and some are paid. Also, some have a higher level of security, including those that use IKEv2 (Internet Key Exchange version 2) encryption technology.

Which is better for business activities and why?

The simple answer to this question is that proxy networks are much better suited to business needs than VPNs. Yes, they share some similarities in terms of their capabilities. For example, VPNs and proxies both enable you to route traffic through a third-party IP address. 

So, where is the difference?

Well, VPNs will typically allow you to access content on a local site, so if you wanted to manually verify the content and images on an international advertising campaign, this would be a good choice. But if you were a marketing agency looking to collect competitor ad campaigns from multiple target markets in order to analyze them and improve your competitive advantage, then a proxy network would be the right way to go. 

The bottom line is that proxies are more suitable for larger-scale data retrieval jobs, such as performing a real-time competitor pricing analysis, whereas VPNs could help you view or purchase items at the local/individual level. 

How to get started

For those of you seeking a VPN solution, Bright VPN is the only premium VPN currently available on the market that is completely free. This is possible due to an exchange whereby you allow companies to route traffic through your device when it is idle, and they, in exchange, pay for your VPN service. These are fully vetted companies that are only performing activities that are legal and that contribute to the online economy. These activities include:

  • Brand protection 
  • Price comparison 
  • Ad verification
  • Academic research 
  • Search engine optimization 

For those of you seeking a proxy-based tool, Bright Data offers many solutions, including a fully automated Web Scraper IDE which uses proxy technology while fully automating the data collection process. It also offers the option of pre-collected Datasets, which can be purchased on the spot and directly fed to algorithms and teams. And lastly, for those companies that do have the in-house technical teams and resources, Bright Data also offers proxy infrastructure, which can serve as the pipelines on top of which your systems and technology can be built and operated. 

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