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Cloud VPN: Definition, Types, Benefits and More

Nicole Fallon
Nicole Fallon

Cloud VPNs are an increasingly popular choice for businesses that want to encrypt sensitive company data for their remote workforce.

With many companies coming up on a year of remote work for their employees, the conversation around VPNs (virtual private networks) has taken center stage in business and technology circles. One increasingly popular option for business owners who want to encrypt and secure their remote employees' web traffic is a cloud VPN.

But what exactly is a cloud VPN, how does it work, and what are its benefits over a traditional VPN? Here's what you need to know about cloud VPNs and how to determine whether they're the right choice for your business.

What is a cloud VPN?

The dramatic rise in remote work due to the COVID-19 pandemic exposed opportunities for growth in many companies' VPN infrastructures. The traditional hardware-based, point-to-point VPN doesn't make sense for a modern, flexible team of remote employees. Enter the cloud VPN, a new type of virtual private network that enables users to access their companies' data securely in the cloud through a globally accessible connection. Cloud VPNs are also known as hosted VPNs or VPN as a service (VPNaaS).

With so many businesses and teams already using cloud-based software or data storage in some way, cloud VPNs have seen a rise in usage. A market summary by Reports and Data shows that the global cloud VPN market is expected to increase by 216% between 2019 and 2026 – from $2.7 billion to $8.7 billion. [Read related article: Don't Want a VPN? 4 Alternatives to Consider]

What are the types of cloud VPN?

There are two types of cloud VPN: remote access cloud VPN and site-to-site connection cloud VPN. The difference lies in each type's purpose.

Remote access cloud VPNs benefit businesses with a mostly remote workforce. Employees install the remote access cloud VPN software on their computers, then connect to the cloud-based VPN service. This creates a way for employees to securely access company resources, files and emails.

"Most businesses opt for remote access VPNs because these types of VPNs … serve business needs the most," said Joe Robinson, cybersecurity analyst at PrivacyAffairs.com. "Remote access VPNs help to establish a secure connection between business networks and the devices used by remote workers. Generally, these are also relatively inexpensive, meaning they are perfect for small businesses."

Site-to-site connection cloud VPNs create a "tunnel" between a physical, onsite network at a business and a cloud network. This solution is best for companies and enterprises that increasingly rely on cloud technology and want a secure encrypted tunnel between their physical network and the cloud.

How do cloud VPNs work?

Cloud VPNs are an efficient, remote and secure alternative to traditional VPNs. This solution secures the cloud, enables remote access and encrypts transmitted data during the connection.

  • Secures the cloud: A cloud VPN, its provider and its end user employ a "shared responsibility model" in their partnership. While the cloud VPN provider offers the network infrastructure, it's up to the end user (or consumer) to secure access on top of the cloud environment.
  • Enables remote access: From multiple devices and locations, employees can connect anytime during the night or day. Cloud VPN remote access affords users the flexibility their work schedules need, which is especially conducive to teams in multiple time zones. It also allows employees to access their company's private network through a public network securely.
  • Encrypts transmitted data: Regardless of the device or location, any data transmitted over a cloud VPN is encrypted, thanks to the VPN's data encryption and tunneling protocols.

Cloud VPN vs. traditional VPN: What's right for your business?

It's up to business owners to decide what's best for their organizations. However, it's worth noting that cloud VPN adoption has steadily increased over the past year with businesses' growing reliance on cloud-based services and solutions.

"There is no one-size-fits-all when it comes to VPN, but there's been an evident trend in the market – owners and employers are moving toward cloud solutions," said Pablo Listingart, founder and executive director of ComIT. "Some of the best small business VPNs are cloud VPNs. I think businesses see the best results with cloud-based VPNs because of the ease of integration among their existing operations."

A cloud VPN offers a new type of secure connectivity that not only protects company data but creates an accessible, flexible and efficient way to work remotely. Unencumbered by laggy wait times between an employee's network and the business's network headquarters, a cloud VPN may be the right choice for your business if you have a completely remote team in many different locations, have no plans to resume working in a physical office for some time, or have most of your infrastructure already based in the cloud.

While traditional VPNs can benefit older businesses with a dedicated IT team and enough bandwidth to support installations, the simple configuration, high communication speeds and easily scalable setup of cloud VPN solutions are more attractive to innovative businesses in a post-pandemic environment. Cloud VPNs can also improve security compared to a traditional VPN.

What are the benefits of using a cloud VPN?

Continuing the education on cloud VPN versus traditional VPN (and helping you decide which is right for your business), here are five distinct benefits of using a cloud VPN.

Direct cloud access

As businesses become more reliant on cloud-based software and technology, moving to a cloud VPN makes sense. Remote access cloud VPNs circumvent a problem with traditional VPNs: All traffic is no longer going through a company's headquarter network, which often delayed communications and frustrated users. With direct cloud access, secure remote access to an organization's cloud remains quick, easy and efficient for the user and the IT department.

Global accessibility

Cloud VPNs enable businesses to grow, work and thrive with their team across the globe. Unlike traditional VPNs, a cloud VPN doesn't limit an organization's geographic footprint or increase network latency for employees in various locations away from the network headquarters. Cloud-hosted VPN solutions can improve network performance and access, in addition to being accessible to team members wherever they are in the world.

Flexibility

Especially for businesses that anticipate changing network architecture, cloud VPN flexibility far outranks other solutions on the market. Cloud VPNs are managed by a service provider that provides greater adaptability and usability to all users. Compared to traditional hardware VPN, which is often difficult and time-consuming to set up (and adapts slowly to network changes), cloud-based VPN software takes mere minutes to configure and is the better option for flexibility.

Scalability

Traditional VPN hardware limits the number of connections an organization can run through it. It has bandwidth limitations and doesn't make meeting increased demand easy. A cloud VPN enables businesses to scale more easily, increasing or decreasing the number of users at the business's discretion.

Mobile support

Most of the widely used cloud VPN solutions offer specific support for users who connect to the cloud VPN on their mobile devices. Traditional hardware VPN is notoriously difficult to use on a mobile device, and support teams often can't offer a long-term solution for this. For a workforce that relies on VPN-connected mobile devices for everyday work, cloud VPNs have a clear advantage.

Image Credit: fizkes / Getty Images
Nicole Fallon
Nicole Fallon
business.com Member
Nicole Fallon has written hundreds of B2B-focused articles on topics such as marketing, business technology, leadership, and HR/organizational management. In addition to covering small business trends and software reviews, Nicole runs a digital marketing agency, where she and her team create high-quality content for a wide range of B2B and B2C brands.