Proxy vs. VPN: why companies are switching to proxies after the introduction of online security laws

In recent years, governments around the world have tightened their control over the digital environment. Online security laws aimed at protecting user data and combating cyber threats have effectively tightened the rules for businesses. Many familiar tools, such as VPNs, have been restricted or no longer meet the new requirements.

Against this backdrop, more and more companies and specialists are turning to proxy servers. Although VPNs were previously considered a universal tool for bypassing blocks and protecting traffic, modern conditions have revealed their weaknesses. In contrast, proxies not only retain the functionality of IP masking, but also provide flexibility, scalability and transparency, which is especially important in the context of strict online laws.

VPN: strengths and new limitations

For decades, VPN (Virtual Private Network) has been the standard tool for:

• protecting privacy,
• bypassing censorship,
• accessing corporate resources.

The main advantages of VPNs:

1. Encryption of all traffic.
2. A single channel for secure internet browsing.
3. Easy setup for end users.

However, online security laws have changed the rules of the game. Today, VPNs face a number of problems:

• Easy to detect — many services and governments have learned to identify VPN traffic.
• They can be blocked — popular VPN protocols (OpenVPN, PPTP, L2TP) are actively blocked.
• They are opaque to regulators — encrypting all traffic does not always meet new requirements when companies are required to provide “demonstrable transparency.”

This is what prompted businesses to look for alternatives.

Proxies: flexibility and control in the new environment

Proxy servers provide more opportunities for fine-tuning and compliance with new online laws.

Advantages of proxies over VPNs:

1. Flexibility of management — you can configure routing only for specific applications or sites, rather than all traffic.
2. Scalability — it is easy to use tens of thousands of IP addresses simultaneously (which is critical for marketing, affiliate marketing and web scraping).
3. Transparency — companies can control data flows and comply with legal requirements.
4. Speed — the absence of “all traffic” encryption saves resources and speeds up the connection.

Unlike VPNs, which are often used by end users for personal purposes, proxies are easily integrated into corporate systems, CRM, advertising accounts and analytics platforms.

Online security laws and their impact on the anonymity tools market

New laws in various countries require:

• user identification (e.g., on social networks and messengers);
• traffic log storage and provision upon request by regulators;
• transparency of business processes related to the transfer of user data.

VPNs, which fully encrypt and hide all activity, are often incompatible with these regulations. Proxies, on the other hand, allow companies to set up hybrid solutions: some traffic goes directly, some goes through a proxy, which helps to meet requirements without losing performance.

Practical application of proxies in business

Today, proxy servers are used much more widely than VPNs.

The main scenarios are:

1. Affiliate marketing — working with multiple advertising accounts without the risk of being blocked.
2. Web scraping and analytics — collecting large amounts of data from open sources.
3. Cybersecurity — filtering suspicious traffic.
4. Access to geo-restricted content — control advertising campaigns in different regions.

With online security laws becoming stricter, proxies allow companies to balance compliance with regulations and operational efficiency.

Comparison of proxies and VPNs

To understand why companies are increasingly choosing proxies under the new laws, it is worth comparing them with VPNs in terms of key parameters.

Traffic encryption

VPNs provide complete encryption of all internet traffic. This is convenient for private users who want to hide their online activities. But for businesses, this becomes a problem: companies lose transparency and control over what data is being transmitted. Proxies are more flexible in this regard—they allow only part of the traffic or individual requests to be routed through them, leaving the rest “open.”

Scalability

VPNs work well for a limited number of employees or tasks, but when it comes to hundreds of advertising accounts or millions of requests, they cease to be effective. Proxies, on the other hand, are designed for scale: they allow you to use thousands or even tens of thousands of IP addresses simultaneously. This is critical for webmasters, marketers and companies working with big data.

Connection speed

Since VPNs encrypt all traffic, they can slow down performance, especially if the connection goes through remote servers. Proxies do not provide total protection, so the connection speed is higher and the load on the system is lower. For businesses where every second counts when processing large amounts of information, this plays a decisive role.

Transparency and control

One of the key disadvantages of VPNs in the new environment is that they are a “black box” for businesses. Traffic is fully encrypted, making it difficult to control what exactly is passing through the channel. Proxies, on the other hand, allow for flexible routing and maintain process transparency, which helps companies comply with legal requirements.

Risk of blocking

VPN traffic is easily detected by many services and is subject to mass blocking. Proxies, especially if they are configured correctly and use IP address rotation, look like regular users. This significantly reduces the likelihood of restrictions.

Thus, VPNs remain a convenient tool for private users and some corporate scenarios, but in the context of modern laws and high flexibility requirements, proxies are becoming a more reliable and scalable solution.

Challenges and limitations of proxies

Of course, proxies are not a perfect solution. Among the problems are:

• the need to carefully select providers (many IPs are quickly blocked);
• the complexity of configuring distributed systems;
• the risk of data leaks when using unreliable services.

However, compared to VPNs, where restrictions are more often imposed by external factors (such as protocol blocking), most proxy issues can be solved with a competent infrastructure.

The future: hybrid solutions

In the coming years, we will likely see a combination of proxies and VPNs. Companies will use VPNs for internal tasks (e.g., remote employee access) and proxies for external purposes: advertising, marketing, analytics.

The development of next-generation proxies—based on AI, blockchain, and IPv6—will further reinforce this trend, making them the de facto standard for businesses operating in the digital environment.

Conclusion

Online security laws have changed the market for anonymity and data protection tools. VPNs, long considered a universal solution, have proven to be less effective under the new rules. Proxy servers, on the other hand, provide companies with more flexibility, transparency and scalability.

Today, the transition of businesses to proxies is not only a matter of convenience, but also a necessity for those who want to remain competitive in an era of total internet control.

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