How do VPNs make money

Irishandnew

I'm curious re how some VPNs make money. 2 examples jump to mind. Nord and mulvad

Nord offer constant amazing deals and advertise everywhere, ive even seen them on the boards in premier league games.

Recently I've seen posters at bus stops here in Ireland for mullvad VPN.

Seems to me a lot being spent on marketing and wonder how they can turn a profit at all.

Curious to here your thoughts.

nologo

They sell their products. Mullvad and Nord are not free services.

Irishandnew

nologo

Yes but nord in particular offer a full year for crazy cheap prices, then also spent fortunes on marketing.

I read a few years ago they spent more on marketing than Verizon in USA. How many customers could they have to turn a profit at that rate.

de0u

Irishandnew I read a few years ago they spent more on marketing than Verizon in USA. How many customers could they have to turn a profit at that rate.

Verizon pays to rent tower space, hang radios on the towers, run fiber from towers to their switching centers, and run fiber between their switching centers. Plus Verizon pays to run storefronts, test phones, etc.

Xtreix

Mullvad VPN makes money from users who pay for the service.

I won't say too much about NordVPN because they belong to several groups, including Tesonet, which exploits data, so they could be making money in other ways with their users' money.

Irishandnew

Xtreix

Thanks for the reply. I'm aware the mulvad has a great reputation in privacy circles.

When I saw the posers as I drove by, I was shocked as we must have such a small user base.

They must clearly be doing well for themselves.

fid03

Irishandnew When I saw the posers as I drove by, I was shocked as we must have such a small user base.

They must clearly be doing well for themselves.

Mullvad's – or rather, their parent company's – turnover for 2024 was 333 million SEK: https://www.ratsit.se/5567839807-Amagicom_AB

So yeah, pretty well.

Sagichnicht

Probably just a big profit margin due to low costs. It's not really something where its impossible to have an I tuition how much it costs them per user

n3t_admin

Low cost. Running a VPN service is not some incredibly expensive endeavor. The gear pays for itself in no time, especially because you don't need much of the most fragile component: storage. So I'm not really surprised they make crazy amounts of cash (that's one of the reasons VPNs became so popular in the last few years - it's like free money).

Irishandnew

Thanks all for the replies. Perhaps I'm a little bit paranoid re these companies

n3t_admin

Irishandnew you should be. A VPN can track/monitor all your traffic, so it is in the same realm as an ISP. I'd be really careful who to trust with my data.

Irishandnew

n3t_admin

That's the thing..how to tell who's legit and who's a honey pot...

gvprtskvni

Irishandnew You can't know who's not. But you can make educated guesses as to which ones are. For instance, if it's owned by an ad company, that should be a dead giveaway.

If you want concrete recommendations, Privacyguides has a list of a few that are generally regarded as being transparent enough: https://www.privacyguides.org/en/vpn/

argante

Difficult question :)
https://windscribe.com/blog/the-vpn-relationship-map/

Irishandnew

argante

I've never seen that imagine before. Thanks for that

Irishandnew

gvprtskvni

Much appreciation for that.

Elgoog

A VPN service might be run at a loss for a while to build market share. I would guess that Uber, for example, was running at a loss for its first few years.