Proxy vs VPN: The Difference

proxy vs vpn
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Proxy servers and virtual private networks have been in advertisements, news, and many other outlets. They have been popping up left and right on every piece of media and content. Often, however, the differences between a VPN and a proxy server aren’t outlined.


To add to the confusion, both of these solutions do perform the same thing – they route internet traffic through a temporary relay station without revealing the true identity of the user. In other words, they take application and web traffic requests and forward them to the intended destination while pretending that the proxy server or VPN is the true source.


These solutions, however, are used for wildly different applications. VPN services are mostly used by regular people, except for cases where a business might create a virtual private network for its own purposes. Proxy servers are almost exclusively used by businesses.

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What is a proxy server?

A proxy server is any other device that allows third party users to connect to them and works as a relay for network traffic. As such, there are many types of proxy servers, differing based on the device, the way they receive IP addresses, and the connection protocols they use.


When separating proxy servers into ones based on their device, the two larger categories are datacenter and residential proxies. The former are ones created in business-owned servers that are generally stored in well-maintained data centers and taken care of by professionals.


As a result, datacenter proxy servers boast some of the best speeds and reliability in the market. They’re unlikely to be beaten by any other solution in those aspects in the near future. Since, however, a single server can create many proxies, many IP addresses come from a single subnet, making them more identifiable.


Residential proxy servers, on the other hand, come from regular household devices such as personal computers, mobile phones, tablets, etc. They are nearly impossible to detect outright, however, since these proxies are maintained by regular people, they are less reliable and significantly slower.


Due to these inherent differences between proxy servers, the way they receive IP addresses isn’t the same either. All residential proxies have an IP assigned to them by an Internet Service Provider. These make them look like legitimate, run-of-the-mill internet users.


Datacenter proxies, however, are created within virtual-machine-like environments where a single physical device can create hundreds of IPs. These IPs are not assigned by an Internet Service Provider and they inherit certain features from the physical device.


Additionally, either type may reveal that a proxy server is in use or attempt to hide the fact by using its own IP address. The former are called transparent proxies as they don’t modify application and web traffic requests in any way.


A transparent proxy server is usually only used by companies for internal purposes. While other types are used for value-generating activities (such as web scraping), a transparent proxy is usually used to optimize web traffic.


Finally, proxy servers might use different ways to process connection requests. Some of them use the well-known Hypertext Transfer Protocol, others use SOCKS5. The former are called HTTP proxies and are the most common type, the latter are called SOCKS proxies, which are only used in highly specific cases.


Proxies, however, are such a flexible solution that we have just scratched the surface of their possibilities. As you may guess, maintaining such a complicated solution is quite expensive, so you should be somewhat wary of free proxy servers. Companies have to get their money’s worth and a free proxy server would only bring value if it’s a free trial for a paid product.

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What is a Virtual Private Network (VPN)?

Virtual private networks, on the surface, are similar to proxy servers. It’s a third-party machine that takes connections and forwards them on your behalf while pretending that the VPN server is the original source of the request.


A VPN server, however, is often based in a powerful machine and rarely or never uses household devices for their purposes. Additionally, a single server may be used by dozens or even hundreds of people while proxies can sometimes be dedicated, which means that only a single user can be connected to it.


Since virtual private networks are usually intended for everyday internet users, they come with easy-to-use interfaces, installation guides, and loads of tutorials written by the VPN provider. As such, it’s a little bit easier to use a VPN client than it is to set up a proxy server.


Additionally, almost all paid VPNs create an encrypted tunnel for security purposes, which means that snooping on your traffic becomes significantly more difficult. Most of the benefits for such a VPN connection comes when you don’t want your ISP or other individuals to see what you’re doing online.


In the end, both a VPN and a proxy server are intended, primarily, as a way to mask your IP address. Both of these machines have an IP address of their own, which they display when making connections on your behalf. 


Such a process means that some use cases interlap between proxy servers and VPNs. For example, a VPN service is frequently used with streaming services to access geo-restricted content. A proxy server can do exactly the same thing, except on a larger scale, which marks one of the primary differences between them.

The difference between a proxy server and a VPN

When it comes to considering a proxy vs VPN, the true difference lies in the scale of operations. As mentioned above, both replace your IP address with their own and forward requests on your behalf.


Proxy servers, however, are intended for commercial applications. They rarely come with shiny user interfaces and great user experience, but you can automate a lot of the processes involved. With some development and coding, you can use proxies to rotate your IP address every second or even with every request.


Doing so with virtual private networks, on the other hand, is nearly impossible. They have built-in user interfaces, which are optimized for ease-of-use, but often lack any automation features. Additionally, they use a much more limited pool of servers that are constantly in use by many people.


In the end, commercial VPNs are intended for daily use and rarely for commercial applications. A proxy server is the opposite – intended more for commercial application and less for daily use. Both solutions can be used for their unintended purposes, but you’re generally better off switching if that’s the case.

When to use VPN vs proxy



Better for daily use

Better for commercial use

Best when only a few or a single IP address is required

Better when a large IP address pool is required

Does not require any development knowledge

Requires minor to moderate development knowledge

Better when the IP address pool doesn’t have to be secret

Better when the IP address pool has to be secret 

Better for low scale operations

Better for large scale operations

Better when customization is not required

Better when customization is required (e.g. transparent proxy vs private)

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