How Do Free VPN Providers Earn Revenue?

making money

As much as we all like freebies, some of us may wonder “why” or “how” they are provided. VPNs have proven to be an invaluable tool for many online privacy advocates. Many internet users utilize free VPN services because they are simple, easy to use, and, most importantly, free. 

However, many VPN users overlook that maintaining a VPN subscription is costly. “Nothing is truly free,” as the phrase goes, especially when it comes to free VPNs. True, you aren’t paying anything directly, but what you may not realize is that you are still paying with something far more valuable: your personal information.

Different ways free VPN providers earn

Trading users’ data

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We’ll start with VPNs’ scariest thing to earn money off their users: selling the information and data they collect. This is undoubtedly one of the most harmful things a free VPN can do since it directly impacts the privacy of its customers and exposes them to potential security breaches.

From your device’s information and location data to personal information, e-mails, messages, phone numbers, and everything else in your device’s memory. Some VPNs have even managed to control their users’ devices, granting them full and unlimited access to the devices, including the ability to edit, change, and even delete media from the controlled devices.

Unfortunately, most people who use a free VPN service don’t read the Privacy Policy before joining a new provider. It implies that it isn’t unlawful as long as a VPN specifies that it can share your data in any manner and you consent to it. It’s unethical and immoral, but it’s a flaw that many free VPNs know how to exploit.

Inserting cookies, web beacons, and pixels

Without your knowledge, these little data packets can follow your surfing history.

Web beacons are similar to browser cookies because they use a clear image file to track your internet use.

Tracking pixels are 1×1 pixel images that load every time you visit a website or receive an email and are used to track certain behaviors.

So, what do all three of these people have in common? They all keep tabs on your internet activities in some way. Advertisers can implant these little trackers into free VPNs, which collect information about your browser history.

Displaying ads

annoying ads

Free VPNs don’t only generate money by allowing marketers access to your data. They also generate additional money by allowing their partners or sponsors to place advertisements on their site while users enjoy their service.

True, most advertisements aren’t intrusive enough to be an actual annoyance, but they can still detract from the overall experience.

Making your server a gateway or an exit node

Although VPNs are sometimes free and guarantee total anonymity of your personal information and web traffic browsing, the VPN provider can monitor your behavior to ensure you’re not engaging in unlawful activities.

Another thing your service provider may do is designate your server as the exit node’s gateway. You may be enabling your server to be used as an ‘exit node’ for unlawful activities as a free subscriber.

Free VPN companies may effectively sell access to your server and network for internet traffic to pass through and depart through your server, where all types of traffic, including criminal activity, may be tracked. So even if you’re not doing anything unlawful, the fact that the activity passes through your server makes it appear as though you’re the one doing it.

Monitoring user activity

monitoring activity

The most common offense committed by free VPNs, which many of their users unwillingly agree to, is tracking their members’ online activity. Several VPNs keep connection records. 

This is basically to ensure that their service runs smoothly and that the networks are safe and encrypted. On the other hand, connection logs may be used to follow a user’s habits and interests.

They accomplish this in a variety of ways. The most common method is to use browser cookies. Most of the time, these technologies can track your internet actions without realizing it. Web beacons and tracking pixels are the other two methods of tracking your online actions. Unfortunately, web beacons, often known as web bugs, are much more widespread than you believe.

Setting usage limits

The better ones will warn you up front that they are just providing limited free services in the hopes that you would upgrade to a paid membership in the future, which usually carries with it better services anyway.

On the other side, some don’t bother to warn you at all. Instead, they intentionally limit your data and bandwidth and even deactivate peer-to-peer connections, including torrents, to entice you to upgrade to their premium service.

Using your data for advertising purposes

Some free VPNs expressly state that your data may be used for marketing purposes. This is concerning since it implies that they are logging your information and utilizing it to determine how best to sell you adverts.

Any VPN firm in one of the 14-eyes jurisdiction nations might be forced by their government or proper authorities to preserve and give any data that comes into their control, including your data.

Why should you pay for a VPN service?

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VPN services provided for free cannot be compared to those provided for paid. They provide a degree of security and privacy assurance that a free VPN cannot match. Benefits of utilizing a premium VPN include larger budgets and well-defined business models. Additional ones are:

  • Faster internet connections.  Free VPNs frequently slow down free users’ internet connections in favor of paying clients. Using a premium VPN service, you may boost your internet speeds and possibly avoid bandwidth limiting from your ISP. In addition, connection dropouts are far less common, and you won’t have any of the problems VPNs of lower grades have.
  • Clear privacy policy. When disclosing their business strategy with their free consumers, free VPNs are frequently secretive and dishonest. When you pay for a VPN, you know precisely what you’re receiving and how secure your connection to a VPN server is.
  • Diverse servers. Servers come in a variety of shapes and sizes. The number of servers is proportional to the speed of the internet. Therefore, a VPN’s servers will be less busy as it grows, resulting in speedier connections. Furthermore, suppose you’re using a VPN to access geo-restricted or barred content from another world. In that case, you can connect to a server nearest your chosen location and have unfettered access regardless of location.
  • Security. Paid VPNs can come with a variety of additional features. Different encryption methods, additional features like the kill switch, and better and stronger encryption are all included. If you’re paying for a VPN service, you should expect at least 256-bit encryption.
  • Customer service. Good customer service comes at a price. This does not imply that your VPN service must be overpriced. It simply implies that if you have an issue while using a VPN, you can expect someone to be on standby to help you when you need it.

Last words

Unfortunately, not everyone is eager to freely give things away out of the goodness of their hearts. While free VPN services may appear to be a good deal, there are frequently hidden prices and agendas in place so that the service operator may profit from your “free” membership.

Always read the fine print of your VPN contract before signing up, and only choose VPN services that offer free and paid services to safeguard your internet traffic.