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What is VPN and how does it work?

5 Mins read

Nowadays, many companies and organizations are using a VPN to communicate or to send voice, video, or data privately over a public network.

So, what is VPN?

VPN is a Virtual Private Network, a technology that extends a private network over a less secure network. It provides remote users secure access to their organization’s network so that they can send and receive data securely. Thus, it provides benefits of security, enhanced functionalities, and management policies of the private network.

Now, let’s understand how does it work?

It’s an extremely good option for faraway workers and agencies with international workplaces and companions to share information in a secure way.


Common Types of VPN:

Some common types of VPNs include:

1. Personal VPNs

A personal VPN service lets you safely connect to an online service – like a website while acting as a middleman between your device and the service you want to access.

By encrypting the connection, it helps users hide their identity online and even lets you spoof your location.

Here, the user can avail of the VPN service by connecting to a VPN server. Some of the personal VPN services include names like NordVPN, ExpressVPN, Private Internet Access, IPVanish, etc.

Personal VPNs are popularly used to stream movies and TV shows unavailable in your geographic location. It can also be used to evade censorship and surveillance in authoritarian states like the UAE and China. Hiding your IP address is also a great way to protect yourself from targeted Distributed Denial of Service (DDoS).

2. VPDN (Virtual Private Dial-up Networks)

A VPDN is a user-to-LAN connection, where faraway users connect with the enterprise LAN. For this, the employer needs to provide the software to the users so that they can easily reach the Network Access Server (a service provider setup) from their desktop, laptop, computers, mobiles or tablets. This type of secure and encrypted connection between the remote users and company’s network is provided by the third party service provider.

Virtual Private Dial-up Network in VPN

In this figure, NAS provides access service for users through the PSTN/ISDN, the dial-up functions of public networks. The L2TP network server, LNS is a device that works in the PPP system as an L2TP server, a VPDN tunneling protocol providing tunnel transmission.

The LAC lying between the LNS and a remote system (remote users and remote branches) transmits packets between them by:

  • encapsulating packets from a remote system in accordance with L2TP and sending to the LNS.

  • decapsulating packets from the LNS and sending to a remote system.

A PPP link or a local connection can be acquired between the LAC and remote system, but a PPP link is always involved in VPDN applications.

3. Site-to-site VPNs

Another type of VPN is generally called a site-to-site VPN. For this, the company invests in dedicated hardware for connecting multiple spots to the LAN via a public network, usually the internet. They are either intranet i.e. accessible only by the employees, organization’s members, or others with authorization, or extranet-based i.e. partially accessible to the authorized outsiders.

It consists of two or more Site-to-Site VPN Gateways that can communicate with each other in a bi-directional relationship. These connected networks function as a single network. You can use this kind of VPN to mesh the company’s branches into one corporate network.


4. Mobile VPNs

A mobile VPN service is ideal for users without a stable connection. Unlike remote access VPN, mobile VPN connection continues even when the user switches from Wi-Fi or cellular network or switches their devices off for a while.

Professionals who work from home in an area with a weak internet connection can use mobile VPN to access their company’s VPN throughout the day, even when their connection is lost.

In this type of VPN connection, the VPN tunnel connects to the users’ IP address instead of connecting to the internet. Thus, the connection stays ON even in poor network areas. The VPN will still be connected even if the user’s device gets switched off due to any issue.

Features of VPN:

1. Secure channel

A VPN is designed for the transmission of data through a secure tunnel between the remote user and the organization’s network. Confidentiality is maintained as the transmitted information cannot be read by anyone else.

VPN security contains various elements for securing both the company’s private network and the outside network through which the remote user connects, usually the internet. The first step to security has a firewall site between the client (remote users) and the host server, a connection point with the private network. The remote user has to establish an authentic connection with the firewall.

AAA authentication: It allows the provider to maintain the user list in the “user@domain” format. So, if the same username exists with two different VPNs, the WebVPN gateway domain is automatically added to the username, creating a user@domain. It is like Group Lock feature in IPsec. Hence, it creates better security and manageability for the VPN because the @domain is always there until and unless the other user generates or somehow uses the same password.

AAA authentication in VPN

2. Encryption

It is also an important element of a secure VPN. Encryption works by having all records sent from one laptop or computer encrypted in a way that only that computer it is sending to can decrypt the data. Types of encryption:

    • Public-key encryption is a method using a public key that is known to everyone, and a private key that is known only to the receiver of the message.

    • Symmetric-key encryption method in which the sender and receiver share a common key that is used to decrypt and encrypt the message.

3. Tunneling

When using a VPN, it is essential to create a network connection by tunneling. There are two main types of tunneling:

  • Voluntary tunneling: First, the client makes a connection with the service provider, then that VPN client creates the tunnel to the VPN server.

  • Compulsory tunneling: In this type of tunneling, the service provider manages the VPN connection between a VPN server and that client.

VPN Tunnel Network Protocols

There are three main network protocols that can be used with VPN tunnels and are mostly incompatible with each other. They include the following:

IPSec: It is a set of protocols that support secure packet exchange at the IP layer with the help of its two encryption modes – transport and tunnel.

PPTP: It is a Point-to-Point Tunneling Protocol, a new technology that ensures secure transmission of messages from one VPN node to another. With PPTP, users can dial into their corporate network via the Internet.

L2TP: It is Layer Two (2) Tunneling Protocol, that enables ISPs to operate VPNs. L2TP amalgamates the features of two other tunneling protocols: Cisco Systems L2F and Microsoft PPTP.

VPN Equipment

You need specific elements to build your VPN that depends on the kind of VPN you use, either remote access or site-to-site. These standard elements include software for each remote workstation, dedicated hardware, such as a product like the Cisco VPN Concentrator or a firewall, a VPN server, and a Network Access Server (NAS).

Lastly, although VPN provides various benefits including:

  • Enhanced security

  • Remote control

  • File sharing

  • Online anonymity

  • Better performance

  • Unblocked websites & bypass filters

  • Reduced costs

  • The ability to change the IP address

But there are some disadvantages also associated with it. So let’s take a look at some Pros and cons associated with deploying this type of communications technology:

In a recent update, the Indian government restricted the use of third-party virtual private networks for government employees. The move is an effort to improve the security posture of government agencies and companies.

The directive issued by Cert-In (The Indian Computer Emergency Rescue Team) also requires government employees to refrain from uploading or saving, confidential or restricted government data on non-government cloud services like Google Drive or Dropbox. The new rules came into effect on June 27, 2022.

With third-party VPNs becoming regulated, organizations will now look forward to comprehensive cybersecurity solutions for protecting their online activities and protecting business and personal information.

A comprehensive cybersecurity solution can provide 360-degree protection to organizations against modern cyberattacks. It goes beyond legacy data protection solutions by leveraging advanced technologies like Artificial Intelligence (AI) and Machine Learning (ML) to identify and prevent attacks beforehand. They also have built-in capabilities to monitor systems in real-time and safeguard against attacks like ransomware and cryptojacking.

To know more about comprehensive cyber protection solutions, get in touch at [email protected]

Feel free to drop your comments in the section below.

This blog was last updated in July 2022.

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About author
Rahul Bansal is an IT pro who brings to the table an experience of over 7 years from IT Infrastructure and security. Rahul's drive and passion makes him a valuable asset in many areas of Process Management. In his leisure time, he likes to visit distant places and loves spending quality time with his adorable son.
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