How Free VPNS Make Money? 5 Scary Facts To Know

VPNs have become an extremely useful tool for many online privacy enthusiasts. Many internet visitors like to use a free VPN service because they are simple, easy to use, and most importantly without a price tag. But many VPN users often forget that running a VPN service costs money. While paid VPNs fund themselves through subscriptions, free VPNs must make money through a variety of methods. So, how do free VPNs make money? Here are 5 scary facts to know about free VPNs.

HOW FREE VPNS MAKE MONEY

1. SELL USER DATA

We’ll start the list with probably the scariest thing VPNs do to monetize their users, and that is selling the information and data their customers provide them. This is without a doubt one of the most dangerous things a free VPN can do, as it directly affects customer privacy and potentially puts users to safety.

So, how and where can a free VPN service sell your data? Well, when looking at the records of some VPNs that actually caught this, there are a number of ways that VPNs work. To put it simply, they extract the data from the user’s device and create separate files for each person. This amount of data and personal information they can potentially get out of a device is really troubling.

Starting from your device information and location data, all the way to personal information, emails, messages, phone numbers, and basically everything stored in your device’s memory. Some VPNs have even managed to take full control of their users’ devices, giving them full and unrestricted access, including capabilities to edit, modify, and even delete media from the monitored device.

In some cases, VPNs sell their users’ emails to outside companies. This is a huge problem for you as a user because not only do you receive a lot of spam and junk emails, but you never know how many people and companies have your email address. Ransomware, cryptojacking, and phishing emails are just some of the possible consequences of VPN mishandling your email.

This sounds too scary to be true, so the biggest question that arises from this is – shouldn’t it be illegal? Well, unfortunately, most free VPN users don’t go through the Privacy Policy before signing up for a new service. It means that as long as a VPN states that it can share your information in any shape or form and you agree to it, it is not illegal. It’s by no means ethical and moral, but unfortunately it’s a loophole that many free VPNs take advantage of.

2. MARKETING BASED ON PERSONAL INFORMATION

In line with the first thing we talked about, sharing data openly for marketing purposes is another very dangerous practice that some free VPNs allow. The reasoning behind this is of course very understandable. Since they don’t make money on user subscriptions, they make up for their losses by making money in different ways. There are a number of different ways that a VPN can share their customers’ data for marketing purposes.

The first is that they use your data and information directly for marketing and advertising purposes. It means that every time you log in or look up something online that interests you, the VPN will store and use this information to determine which ads are sold to you and how to do it most efficiently. The second way they do this is they openly share this data with outside companies and their partners. This is the more dangerous option of the two as the VPN and the marketing company are basically integrated into one platform and both have full control over your data. It is so dangerous because the marketing company often links ads from websites and pages that are not reliable sources. These ads are not only frustrating,

There are many examples of this, but probably no better than Betternet, a free VPN service that openly and openly states their relationship with online marketing companies. They don’t hide the fact that they have an ad-focused business model. However, they don’t go into too much detail about their location, business information, and important details about how this ad-focused business model works behind the scenes.

The only benefit to this problem is that it is a very good way to judge how reliable a free VPN is. In other words, if you find that your VPN is aggressively bombarding you with ads, it is a sign that they are very likely to be sharing your personal information and activities with third party websites.

3. EXPLOIT FREE USERS FOR THE BENEFIT OF THE PAYING

In addition to selling your personal information to third parties, free VPNs can exploit your trust in a number of different ways, the most prominent of which is for the benefit of their paying customers. This is a problem that arises when a VPN functions as a free and paid service at the same time. This is because the VPN then works separately on two completely different levels. They give you, the free user, access to the internet without any conditions, but at the same time, they exploit your connection in different ways.

The best examples of this outdated technique are the VPNs that use the processing power of the free user and transfer it to their paying customers. This essentially means that the VPN is selling your bandwidth to other users for profit. You can of course avoid it by opting for a paid membership if the VPN offers one. The only catch is that there are VPNs that don’t share this information with their free users, so you don’t know if your device and connection are being used to benefit someone else.

4. CREATE BOTNETS AND EXIT NODES

If the previous tactics that VPNs use wasn’t scary enough, this one has some real-world consequences that can get you in a lot of trouble with the law. While some VPN users may not have a problem with this type of service exchange, it can actually give them quite a headache. To be a server exit node means that all traffic going to the end node server will appear as if it came from that server’s IP address.

This can cause a lot of trouble, as the traffic going through can include all kinds of illegal activity, search queries, and browsing history. It’s definitely not worth the risk, especially when you consider that you take all the responsibility without getting any compensation while the VPN service makes money from all their paying members using your connection and IP address as the exit node.

Cases have been recorded where innocent people have been investigated by the government for illegal activities over the Internet. All of this happened because the VPN they thought they were using for free was basically using their network and IP address to create a botnet that other users could connect to using their IP address. In addition, hackers managed to take control of all free accounts in the VPN network and create a large botnet that they could use for anonymous malware attacks. While all of this sounds like a plot from a thriller movie, this was a real-life case that happened to Hola VPN users.

While the Hola VPN scandal was a major milestone that helped shed light on the danger of using free VPNs, there are still free VPNs that do this. The terrifying part of this is that there are currently no procedures or measures in place to monitor how these VPNs are exploiting their users’ trust.

5. TRACK USER ACTIVITY

Last, but certainly not least, the most common offense that free VPNs make and that many of their users (un) willingly agree on to are tracking their members’ online activities. There are many VPNs that keep connection logs. This is mainly to keep their service running without any issues and to make sure that the networks are safe and encrypted. However, connection logs can also be used to track the habits and interests of a particular user.

They do this in different ways. Usually, this is done by inserting browser cookies. These tools can track all of your online activity without you usually being aware of it. The other two ways to track your online activities are web beacons and tracking pixels. Web beacons, also called web bugs, are more common than you think. They are those recognizable crisp image files that are used to track your activity on the web. Tracking pixels work in the same way as web beacons, but look different. They are more useful for analyzing data and tracking users’ online behavior. Not only does the VPN use these tools to track your activity, but in some cases, they also allow their marketing partners.

So while you think you are anonymous and private while using the VPN services, your online activities are actually being tracked all the time. While most VPNs don’t admit this, they do collect your information and all of your activity data and usually store it for the highest bidder. Unlike free VPNs, the ones you pay for usually list everything in their Privacy Policy, which means that when you pay for a service, you can actually check that you’re getting what you’re promised.

Using a VPN that tracks your online activities defeats the purpose of using the VPN. Rather than allowing your ISP to track your activity, you give this power to the free VPN, which is a very dangerous thing as you can never tell if their intentions are good or bad. If a free VPN is located in one of the 14 eyes countries, it also means that they are required to share all the information requested by the government of the country they are in. This is a risky position to put yourself back in, you are the only one to take responsibility if something goes wrong.

WHY DO FREE VPNS USE SUCH TACTICS?

For some VPNs out there, money trumps the security and privacy of their users. Selling user data, using it for advertising, or violating their security and privacy are just some of the ways free VPNs make money. But before we get into the details, it’s important to talk about all the important aspects and understand why some free VPNs are abusing their customers’ trust. These are the biggest reasons why they do this:

HIGH MAINTENANCE COSTS

As we mentioned at the beginning, it’s easy to forget that running a VPN network costs money. Depending on the size of the VPN customer base, monthly maintenance costs can easily add up to tens of thousands of dollars. Not to mention, as the VPN grows and requires more stable and powerful servers, these costs can reach hundreds of thousands or even millions. That’s why server costs are probably the biggest reason most free VPNs decide to go behind their customer’s back.

FINANCIAL PROFIT

Of course, breaking even isn’t as good as making money. That’s why some VPNs decide to go a step further and use their customers’ data in certain ways that allow them to make more money. This usually includes selling or sharing data with third parties or creating highly targeted ads that generate more profit from advertisers.

GREED

While some people may argue that the first reason is justifiable, and even the second, no one can apologize for actions that stem from pure greed. When you have confidential data from tens, even hundreds of millions of users, it becomes very tempting to put all this knowledge and power to use. Many popular free VPNs have succumbed to this, with Hola, Betternet, and even Opera VPN shutting down for a while to try and monetize their users’ data.

WHY YOU SHOULD CHOOSE A PAID VPN SERVICE

Free VPN services cannot be compared to services with a price tag. They offer a level of security and privacy guarantee that simply cannot be matched by a free VPN. With larger budgets and well-defined business models, paid VPNs simply provide a service that free VPNs cannot match. Benefits of using a paid VPN include:

  • Better Connection Speeds – Free VPNs often limit the internet speed of their free users in favor of their paying customers. With a paid VPN service, you can enjoy improved internet speeds and even enjoy bandwidth throttling from your ISP. Connection drops are much rarer, and you won’t experience free issues that lower-quality VPNs suffer from.
  • Clear Privacy Policy – As we mentioned before, free VPNs are often secret and not very fair when it comes to sharing their business model with their free customers. When you pay for a VPN, you know what you are getting and exactly how private you are when connected to a VPN server.
  • The diversity of servers – The number of servers goes hand in hand with internet speed. The more servers a VPN has, the less busy it will be, which means faster connections. In addition, if you use a VPN to access geo-restricted or blocked content from another part of the world, you can easily connect to a server closest to your desired location and enjoy unlimited access wherever you are .
  • Security – Paid VPNs can come with a number of extra features. This includes various encryption protocols, special features like the kill switch, better and stronger encryption. When paying for a VPN service, settle for no less than the standard 256-bit encryption.
  • Customer Service – Same as all of the above benefits, great support comes at a price. This does not mean that you should overpay for your VPN service. It just means that if it happens that you run into a problem using a VPN, you can expect someone to be on standby and help you when you need help.

TOP 3 PREMIUM VPN’S

Having said all that, keep in mind that not all paid VPNs are good or without errors. It’s always best to do some research before opting for a VPN. To help you choose the most suitable VPN for your needs, we bring you the top 3 premium VPNs currently available.

# 1. EXPRESSVPN

ExpressVPN is widely regarded as the best all-round VPN. It comes at a slightly steeper price point compared to the competition, but the service you get in return is well worth the cost. ExpressVPN is probably the most convenient VPN currently available as it is easy to set up and available on any device. They have quite an impressive server network with over 3000 high-speed servers in 94 countries and 160 locations. Speaking of high speed, the ExpressVPN speeds are some of the best in the world as you can be assured of maximum efficiency when connected to one of their servers. You can expect speeds to vary between 80 Mbps and 85 Mbps on a 100 Mbps network.

  • Fastest speeds with all other VPN providers
  • No logs
  • OpenVPN, IPSec & IKEv2
  • Torrents / P2P allowed
  • Unblocks Netflix, Hulu, BBC iPlayer
  • 24 × 7 Live chat support
  • 30-day money-back guarantee

# 2. IPVANISH

Coming in second, IPVanish is perfect for people who regularly download files and content from the Internet. It offers good and stable download speeds, with unlimited bandwidth and unlimited P2P traffic. With servers in more than 60 countries, absolutely no traffic logs, and up to 10 simultaneous connections, IPVanish is a really useful VPN. While the interface may not be as easy to use as ExpressVPN’s, it offers a lot of customization, which is sure to impress more experienced VPN users looking for a new VPN.

  • Good speeds
  • No logs
  • AES-256 encryption
  • P2P allowed
  • 7-day money-back guarantee

Read my IPVanish review

# 3. NORDVPN

If you’re looking for the best combination of quality and quantity, NordVPN is the way to go. With the lowest membership price and a 30-day risk-free guarantee, NordVPN is a risk-free option for any privacy enthusiast on a budget. NordVPN is not only affordable but also powerful. With more than 5,200 servers in 62 countries around the world, they provide the largest server network of any VPN. Their military-grade dual encryption and no-log policy make them an ideal option for browsing, streaming, and downloading content.

  • Good speeds
  • No logs
  • OpenVPN, IPSec & IKEv2
  • P2P allowed
  • Blocks Netflix
  • 30-day money-back guarantee

CONCLUSION

While the Internet can be a scary place at times, with a few extra steps you can enjoy unlimited and secure access, and it all starts with getting a reliable VPN. If you really value your online privacy and security, don’t settle for a free VPN service. There are many choices available, starting from just a few dollars a month. We end it with a phrase you should always keep in mind, not just when using the Internet. Everything has a cost, and if you don’t pay the price of the service, it usually means you are the product.

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