What Is a VPN?

Virtual private networks arose from the need to securely transmit data over wide area networks like the Internet. A VPN tunnels information through public networks, encrypting all data sent so that the connection is private even over public channels. Since VPN relies on WAN connections instead of local networks, computers connected via VPN don't have to be physically nearby -- they can be on separate continents and still interface.

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VPN Types

There are a number of ways to implement VPN, using both software and hardware. Pure software VPNs use programs downloaded onto both computers to connect them and require no additional equipment. Hardware VPN systems use special routers to facilitate the connection, and require compatible software. Some corporate systems use pure hardware, connecting two routers together via the VPN -- usually this is for networking servers in different locations.

Business Applications

Many modern businesses make extensive use of VPNs to maximize efficiency. Using a VPN, employees can connect to the computers in the office network from their own PCs at home and access documents, messages and other information. Different office branches can connect to the home office and one another via server-to-server VPN, sharing important information securely.

Consumer Uses

Everyday consumers can make use of VPNs as well. Using a VPN when you have to use public Wi-Fi or other loosely secured networks can add a layer of protection against information theft. Even at home, you can use VPNs to securely access sensitive online resources. VPNs can also help you circumvent online censorship or website blocks, although doing so may be against local laws and can carry legal repercussions.

Downsides to VPN

While useful, VPNs do have some drawbacks. Because of the additional network overhead involved, they may reduce your transfer speeds compared to using an unsecured connection. Setting up and using a VPN may also be confusing at first to novices. When using a VPN to connect to your employer's computer network, your own personal computer may be required to adhere to the company's usage policies.