Proxy vs. VPN: 4 Key Differences

What Is a Proxy?

When using a proxy server, an employee’s outgoing connection first travels to a separate server, and is then forwarded on to the target website. By functioning as an intermediary and sitting between end-users and internal resources, it’s possible for a proxy to act as a secure gateway.

With its own unique Internet Protocol (IP) address, a proxy server masks the endpoint’s own, and allows for an enterprise to gain insight into the browsing activities of hybrid and remote employees.

This data can be forwarded to a firewall, or otherwise used to protect both resources and employees.

The Most Common Types of Proxies

1. Forward Proxy. It simply passes requests on from an internal, local network to the public Internet. This is essentially what a firewall is – it’s a forward proxy that’s configured to apply filtering rules to assess the legitimacy of a user’s request.
2. Anonymizing Proxy. Depending on the provider, these can range from simply replacing a device’s IP address with the server’s, to concealing the fact that they are proxies to web servers.
3. Transparent Proxy. These are commonly used by large organizations to cache frequently visited websites or to filter inappropriate content and block malicious traffic.

How Are Proxies Used?

By employing a proxy server, it becomes possible for organizations to retain visibility over the connections that employees make. This is a good fit for enterprises with a lot of remote employees, as the basic format allows for instant visibility into users’ web traffic.

This secure foundation is often supported by limiting employees to only allowing network access through it – essentially blacklisting anything that attempts to access resources outside of the secure proxy.

There are both hardware and SaaS versions of enterprise proxies.

• Hardware connections sit between the internal network and the public internet – from where employee devices connect to and transfer data through.
• Software proxies are typically hosted by a cloud provider, and end-users connect via an installed application.

Proxy vs. VPN: The 4 Key Differences

Here are the key differences between proxies and VPNs.

#1: Data Encryption

Proxies do not encrypt data; they simply reroute traffic through the intermediary server. This means that while a device’s IP is hidden, the actual data being transmitted is not protected and can still be intercepted by third parties.

VPNs encrypt all data passing between a device and the VPN server, ensuring that it remains secure and unreadable. In a lot of cases, services advertised as “free VPNs” are, in fact, just proxy servers with only partial in-transit encryption: this allows the proxy provider access to their clients’ data (usually for further resale).

#2: Scope of Protection

Because proxies don’t provide encrypted tunnels, their scope of protection is technically more limited: if the proxy provider were compromised, for instance, there would be no inbuilt protection for the data being moved through it.

With that said, legacy firewalls have often struggled with VPN encryption, as it restricts insight into the data packets being transmitted.

• This means that, paradoxically, proxies’ lack of inherent data protection allows for tighter integration with an already-existing firewall and security tools.
• For organizations without pre-existing security software like firewalls, VPNs can provide a wider breadth of protection than proxies.

This is because proxies are often application-specific, whereas VPNs protect all internet traffic on your device.

Once an end-user connects to a VPN, it automatically encrypts and reroutes data from all applications, ensuring comprehensive coverage.

#3: Connection Speed

Proxies are generally faster than VPNs, as they are not having to use the extra resources involved in encryption and decryption. This makes proxies a good choice for tasks where speed is a priority, and security is less critical. While VPNs can be slower, they can still make sense from a security perspective – and they shouldn’t slow browsing down by a noticeable amount.

The true impact on secure connection speeds depends on factors like the:

• VPN provider
• Server location
• Network hardware resources

Furthermore, proxies can be used to cache content closer to the end-user (this is the architectural basis of Content Delivery Networks), which can in turn increase connection speeds.

Limitations

Proxies are essentially just normal web servers that are controlled by an enterprise or security provider.

This means that the proxy holds onto caches of past browsing behavior – which itself can represent a risk. Furthermore, proxies only provide connection on an individual, application-by-application layer, meaning they can represent a real headache for the staff having to set up and maintain them.

This is completely unlike VPNs, which are implemented at the operating system level – and therefore one VPN client covers an entire device’s online activity.

There are two limitations to VPNs:

1. They cannot be used to filter traffic by web content
2. They do not play well with traditional firewalls