The Multi-Billion VPN Market: A Staggering Growth

With the dramatic shift to remote work models, consumer awareness and an ever-growing need for privacy, the recent years have become a springboard for the VPN industry, where privacy, cyber-threat and censorship intersect.

Where It All Started

While the concept was developed in the late 90s – a private communication tunnel – Virtual Private Network adoption boomed at the very beginning of our century after growing demand from large corporations.

The needs were simple: digitization involved virtual files and more of them transferred between employees and locations, in a secure and private way. And this is where VPNs came into play.

A few years later, the technology became available to consumers, who realized the benefits of hiding an IP for protection against spamming, privacy breaches or censorship. Today’s picture is very diverse, with a big range of solutions offering corporate/private VPNs with all sorts of bandwidths and prices. The average VPN costs around $10/month at a speed of 90 Mbps.

A Dynamic And Attractive Market

Some of the key players are NordLayer, Cisco Systems, CyberGhost S.A., Perimeter 81 for businesses and NordVPN, Tunnelbear, ExpressVPN or Windscribe for individuals. A key characteristic of VPN companies is the number of servers they use, ranging from 500 to 3000+ for some.

Given the nature of the technology and the exponential growth of this market, global rankings can change from one month to another. Here are the top-ranked VPNs for March 2022 according to Forbes Magazine: 1/Private Internet Access 2/CyberGhost 3/Torguard 4/NordVPN.

The most recent development in the sector was the acquisition of ExpressVPN for $936 million by British-Israeli digital security firm Kape Technologies PLC.

Current Trends: Cybersecurity, Conflict, And Censorship

According to the Global Web Index, the main reason for VPN usage around the world is access to entertainment, and obviously, Netflix or Disney + come to mind.

But other reports quote a less trivial reason for using VPNs: cyber-crime. The World Economic Forum’s 2020 Global Risk Report shows it has increased by 600% since the beginning of the pandemic, making it a top priority in corporate risk and personal data security, leading to an increase in demand in the next years.

Censorship, particularly in times of conflict and media blackouts, is pushing millions of users to VPN providers who seek access to popular social media platforms or blocked services.

The best example is the surge in VPN usage in Russia as a result of hundreds of websites and platforms blocked by the government. The use of VPNs between March 11 and 14 blew up by 2000% after the blocking of Instagram in the country.

On March 13, the top 3 apps in the Russian App Store were VPN Proxy Master, Faster Internet and VPN Super Unlimited Proxy.

Facts And Projections

  • According to the Global Web Index, Asia-Pacific and the Middle East are the regions with the highest rate of VPN use (34%), followed by Latin America (30%), North America (22%) and Europe (21%).
  • The top countries are Indonesia (61%), India (45%), Saudi Arabia (44%), and Malaysia (43%).
  • According to Research and Markets, the VPN market is expected to reach $91 billion by 2026 at a CAGR of 18.7%.

Disclaimer: This article is not investment advice or an investment recommendation and should not be considered as such. The information above is not an invitation to trade and it does not guarantee or predict future performance. The investor is solely responsible for the risk of their decisions. The analysis and commentary presented do not include any consideration of your personal investment objectives, financial circumstances or needs.

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