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VPN or Proxy: What's the difference

By AutomatorB | Technology spotlight | 13 May 2020

Proxy server is a server that serves as a middleman between you and everything in your web browser, so that your internet activities appear to come from somewhere else. Let’s say for example you are physically located in Paris and you want to log into a website that is geographically restricted to only people located in the United States. You could connect to a proxy server located within the US, then connect to that website. The traffic from your web browser would appear to come from the remote computer and not your own.

Proxies are great for low-risk tasks like watching demographically restricted YouTube videos, bypassing basic content filters, or bypassing IP-based restrictions on services.

For example: Several people in our household play an online game where you get a daily in-game bonus for voting for the game server on a server ranking website. However, the ranking website has a one-vote-per-IP policy which doesn't look whether different player names are used. Thanks to proxy servers each person can log their vote and get the in-game bonus because each person’s web browser appears to be coming from a different IP address.

On the other side of things, proxy servers are not so great for high-stakes tasks. Proxy servers only hide your IP address and act as a dumb man-in-the-middle for your Internet traffic. They usually don’t encrypt your traffic between your computer and the proxy server, they don’t typically strip away identifying information from your transmissions beyond the simple IP swap, and there are no additional privacy or security steps built in.

Everyone with access to the stream of your data (your ISP, your government, a guy sniffing the Wi-Fi traffic at the airport, etc.) can take a look at your traffic. Further, certain exploits, like malicious Flash or JavaScript elements running in your web browser, can reveal your true identity and location. This makes proxy servers unsuitable for serious tasks like preventing the operator of a malicious Wi-FI hotspot from stealing your data.

Finally, proxy server connections are configured on an application-by-application basis, not computer-wide. You don’t configure your entire computer to connect to the proxy. You can only configure your web browser, your BitTorrent client, or other proxy-compatible application. This is great if you just want a single application to connect to the proxy but not so great if you wish to redirect your entire internet connection.

The two most common proxy server protocols are HTTP and SOCKS4/5.

The classic type of proxy server, HTTP proxy is designed expressly for web-based traffic. You just enter the proxy server credentials into your web browser’s configuration file (or use a browser extension - easier but less efficient way) and all your web traffic is routed through the proxy server.

In case you, for some reason, need to use HTTP proxy to connect to any sort of sensitive service, like your email or bank, it is critical that you use a browser with SSL encryption enabled and connect to a website that supports SSL encryption. As we noted above, proxies do not encrypt any traffic, so the only encryption you get when using them is the encryption done between your browser and the site you're using.

SOCKS proxy system is a useful extension of the HTTP proxy system because, besides of HTTP data, it transfers different protocols as well, helping protect more of your internet traffic.

Where HTTP proxies can only handle web traffic, a SOCKS server will simply pass along any traffic it gets, whether that traffic is for a web server, an FTP server, or BitTorrent client.

The downside to SOCKS proxies is that they are slower than pure HTTP proxies because they have more overhead and, like HTTP proxies, they offer no encryption beyond what you personally apply to the given connection.

How to Select a Proxy

When it comes to selecting a proxy, it pays to…well, pay. While the Internet is awash with thousands of free proxy servers, they are almost universally flaky with poor uptime. Those kind of services might be great for a one-off-task that takes a few minutes (and is not particularly sensitive in nature), but it’s really not worth relying on free proxies of unknown origin for anything more important than that.

While there are stand-alone commercial services - which can be quite expensive, the rise of faster computers and mobile devices coupled with faster connections (both of which reduce the impact of encryption overhead) the proxy has largely fallen out of favor as more and more people opt to use superior VPN solutions.

Virtual Private Networks Encrypt Your Connection

VPNs, like proxies, make your traffic appear as if it comes from a remote IP address. But that’s where the similarities end. VPNs are set up at the operating system level, and the VPN connection captures the entire network connection of the device it is configured on. This means that unlike a proxy server, which simply acts as a man-in-the-middle server for a single application (like your web browser or BitTorrent client), VPNs will capture the traffic of every single application on your computer, from your web browser to your online games to even a system updater running in the background.
And additionally, this entire process is all passed through a heavily encrypted tunnel between your computer and the remote network. This makes a VPN connection the most ideal solution for any sort of high-stakes network use where privacy or security is a concern. With a VPN, neither your ISP nor any other snooping parties can access the transmission between your computer and the VPN server. If you were traveling in a foreign country, for example, and you were worried about logging into your financial web sites, email, or even connecting safely to your home network from afar, you could easily configure your laptop to use a VPN.

When choosing a VPN, make sure the provider doesn't keep activity logs.

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