How Do Free VPNs Make Money? The Hidden Price You Pay!
VPNs are a shield for your online privacy and a secure path to content that might be restricted in your region. They sound like a valuable asset, don’t they? So, how is it that some VPN providers offer this service for free? How do they keep the lights on, considering all the costs of maintaining […]
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VPNs are a shield for your online privacy and a secure path to content that might be restricted in your region. They sound like a valuable asset, don’t they? So, how is it that some VPN providers offer this service for free? How do they keep the lights on, considering all the costs of maintaining servers, software development, and high-speed bandwidth?
The short answer is that most of these providers aren’t offering this service out of kindness or concern for your privacy. This is how they make up for the maintenance costs:
- The freemium model
- Selling user data
- Bandwidth sharing
- In-app display advertising
5 Common Revenue Models for Free VPNs
Free VPN’s have a few tricks up their sleeves to earn money. The following 5 revenue strategies are the most common ones. A VPN service adopts one to three models to monetize its service based on its business plan. Of course, combining two or three methods is merely a matter of greed because it can easily lead to users’ dissatisfaction and, eventually, to the project’s failure.
1. Freemium Model (Upselling to Paid Plans)
Earning clients’ trust is a jagged iceberg in the business sea. For VPN providers, the freemium plan is a way to earn users’ trust. In this method, the VPN provider just offers you the very basic and often limited features of their service. For instance, you can only benefit from unrestricted internet access, but with limited speed.
They employ the freemium method in the hopes of converting free-tier users to Premium users. Meanwhile, the VPN provider relies on the revenue from Premium users to keep things going. Premium users enjoy the full features, and the provider makes sure of it that free users know what they’re missing.
2. Data Collection and Selling User Information
Information is power! In this method, the VPN collects users’ data and sell is to advertisers, market researchers, or data brokers. These third-party buyers use the data to deliver personalized ads that have a higher conversion rate ( i.e., the chance of turning the viewer into a buyer).
For instant if you’re browsing tourist attractions in Hawaii, you encounter ads for plane ticket discounts. The VPN gets its fair share through commission per impression or click.
This method is very close to violating the users’ privacy, especially because the VPN provider doesn’t ask for your consent. Hopefully, the VPN aggregates or anonymizes users’ data before sharing it with the advertising networks.
3. Bandwidth Sharing
Bandwidth sharing, also known as peer-to-peer or residential proxy networking, allows VPN providers to utilize the idle bandwidth of free users’ devices as part of their infrastructure. In fact, a free user’s device acts as a proxy server for a Premium users who need access to IP addresses for purposes such as web scraping.
4. In-App and Display Advertising
This is a conventional and straightforward way for free VPNs to make money. In this method, the VPN provider shows the user non-personalized ads in the app during user sessions. Since the ads are not personalized, there’s no need for users’ data, which makes this revenue model legit and low-risk when it comes to users’ privacy. However, the VPN might enforce session limits to make users watch the ads before establishing another session, which can be disruptive for the users.
The Alternative for Free VPNs
Sometimes, using a free VPN is your only option for unrestricted VPN access because you can’t pay for a Premium membership for any reason. The good news is that there are safe VPN apps that offer a free tier, too.
Trustworthy Free VPN Options
The following are some of the most trustworthy no-log VPN providers. Each has its limitations, but it’s better than nothing at all.
| VPN Provider | Freemium Features | Limitations |
|---|---|---|
| ProtonVPN | + Unlimited data + End-to-end encryption + No ads | – 1 device – Restricted server countries |
| Windscribe | + Unlimited devices + No ads | – 10 GB monthly data cap (2 GB without email verification) |
| HidzoVPN | + Unlimited data + Multiple server locations + Automatic server selection | – 1 device – Limited sessions (30 mins) |
| TunnelBear | + Unlimited data + Kill Switch | – 2 GB monthly data cap |
| Hide.me | + Unlimited data + AES-256 encryption | – 1 device – Restricted speed |
| PrivadoVPN | + Kill Switch + No logs + Unlimited devices + No ads | – 10 GB monthly data cap |
Paid VPNs and Why They’re Worth It
The best thing about a Premium VPN subscription is the uninterrupted and unrestricted access to a secure internet. Imagine you’re watching something on YouTube, and every 30 minutes or so, you have to watch an ad and reconnect your VPN. And this is besides the ads you must watch on YouTube.
The problem with paid VPNs is that you can’t get a good deal unless you purchase a long-term subscription. Among the listed providers, HidzoVPN stands out since even its monthly plan is cheap. You can buy HidzoVPN Premium for just $2.99/mo and unlock all features, such as Kill Switch, Smart Protocol, no ads, and unlimited sessions.
Free VPN: A Digital Mirage
Are free VPNs safe? Well, nothing good is ever free. Let’s quote Tristan Harris, a former Google Design Ethicist: “If you’re not paying for the product, you are the product.” Even in the case of trustworthy free VPNs where your privacy is not at stake, you’re paying the price with your time, and we all agree that time is too expensive.
Privacy Risks
Would you like to hear something ironic? A VPN, which is the best tool to protect your online privacy, might actually sell you out to keep the money coming. Also, they might skimp on robust security for free users to cut costs and reduce infrastructure workload.
Also, if they keep your activity log, which most of them do, your data can fall into the wrong hands if their servers are hacked. Additionally, VPNs that are based in countries with lax privacy laws might hand over your data to authorities without a fight.
On a related note:
If it’s important that what you do only remains private and anonymous, the tips in this Online Privacy Guide can turn you into an online ghost.
Frustrating Performance Issues
Free VPNs offer minimal services. Your speed is reduced, your data is capped, your sessions are limited, and you’re bombarded with ads. In short, your productivity is compromised.
This means you can’t use free VPNs for work or for anything that needs uninterrupted protection. In other words, free VPNs are good for casual browsing or accessing restricted content, such as a certain social network.
A Hole in Your Device’s Security
In the worst case scenario, some free VPNs can be outright scams. They might infect your device, steal your passwords, or use your device’s hardware as part of their infrastructure. And since they’re not transparent about their service terms, you don’t know how they can breach the security of your device.
FAQs
Free VPN providers use methods like displaying ads, restricted VPN access, and monetizing users’ data to make up for the free VPN service.
In some cases, yes. Selling users’ data is one of the methods a free VPN provider might adopt to gain profit.
The warning signs for a dangerous VPN include a lack of transparency in privacy policy, excessive personalized ads, and unnecessary permissions required when installing the app.
No VPN is entirely free without limitations or revenue needs.
