VPNs are one of the most important tools to enhance your Privacy and security. A VPN allows you to hide your IP address, circumvent geoblocking and censorship, and hide your traffic from your ISP and third parties. Providing a VPN service is coupled to high cost for expensive servers with large bandwidths. This raises the question, how some of these VPN companies can offer their services for free?

Providing a VPN service requires a large and expensive hardware infrastructure. Other than just selling software, VPN servers are physical computers that have to be maintained and connected with fast and unlimited internet; that’s a lot of electricity consumption.

At this point, we have to understand the business model of free VPN service providers. Since the user does not pay the VPN company, the VPN company has to draw their income from other sources. More often than not, this means that the VPN company is making money by collecting your Personal data and selling it. For the VPN company, this is a pretty easy business because of the powerful position they have placed themselves in. All of your internet traffic passes through their servers, providing them with a lot of valuable metadata, even if the internet connection is encrypted. If the connection is not encrypted the VPN company can also see the actual content that passes their servers. Some free VPN providers require you to install their app on your device. By using a free VPN with a distinct app, your device becomes the almost perfect tracking tool.

Privacy Policy of a free VPN Service

You are bound to the corresponding terms of service by using a VPN. Many free VPN providers have terms of service and a Privacy Policy that allows the company to collect and sell your personal data. By agreeing to these terms, you have willingly or unknowingly accepted the collection and monetization of your habits and data.

Let us look at some quotes from the Privacy Policies of a free VPN provider by looking at, what data a provider would be interested in collecting. The Privacy Policy of such services usually start by telling that they collect:

• name
• email
• IP address
• location
• device manufacturer
• mobile operator’s region and code
• […]

These are general data about a user and many may be willing to share these. Let us go deeper into how they collect and store this data;

“[…] we may use cookies, web beacons, our own data collection tools or various third party services.” and “when we collect your data, we associate it with a unique ID and a unique device ID […]”.

Your data might be assigned to an anonymous ID, but your name and email are still contained in it. In fact, it has been shown that „anonymous data“ can easily be deanonymized. For more information, consult Deanonymizing Browser Data Made Easy.

The main objective of a free VPN company is not to collect and keep your personal information, but to sell it in order to make money. That is why they share this data with “third-party purchaser and seller” and “our partners or other trusted third parties”. “Our partner” sounds much more trustworthy than “anybody who is willing to give us money” but in many cases, they are the same. Knowing your habits and personality is like gold for advertisers in order to better find and target you.

For most people, a VPN is a tool for enhancing your privacy and security. Therefore, statements like the following are definitely red flag raisers.

“[We] may provide Personal Information to third-party service providers who work for [us] and who may contact you […]” or “[…] understanding the usage, viewing, and demographic patterns for certain programs, content, services, advertisements, promotions, and/or functionality on the service.”

While many free VPN providers sell your personal data, some have developed alternative financing methods. Some show ads, encourage you to watch sponsored video, or to promote their service on social media. As odd as it may sound, some services also rent personal information to third parties.

Conclusion

From a privacy perspective, it is not recommended to use a product from a company that does not have a clear business model. Any company has to be funded somehow and if this is not done with a clear and open business model, the company might be involved in suspicious activities that does not serve your best interest. The main reason why people want to use a VPN is to protect their data and preserve their privacy. Using a free VPN is a complete contradiction to this mindset. Therefore, the best way to get a quality and secure product is still to pay for it. Nothing is free. And paying $4 to $7 per month for top-class privacy is cheaper than a Starbucks coffee and most definitively worth it.

 
The quotes have been taken from the privacy policy of Opera VPN. Opera VPN shut down its services in April 2018