ELI5: How do VPN providers afford all that bandwidth?

VPN
1

I just don’t understand, how they can funnel all that traffic through their own servers in that they can even make a profit from it.

2

How does Netflix afford to provide a services a for $8 a month while making a profit, paying content providers, and running servers that stream HD content to millions of users?

Same concept with a VPN. Data centres have extremely high bandwidth. They host several servers. By pooling together large amounts of users it starts to bring down the hosting costs. It’s just like a website. If you want a dedicated server to host a website it will cost you hundreds of dollars a month. But if you use a VPS or shared hosting you can pay only a few dollars a month. This is because the resources are spread out amongst you and various other people.

3

They operate out of massive data centers that lease bandwidth for pennies on the dollar. You can start a VPN on you own. Most of the cost comes from infrastructure, but VPN providers don’t have any owned equipment.

4

I used to run a VPN service. We leased servers through a reseller which aggregated bandwidth from the datacenter provider to give a better bulk deal. A single dedicated box was $200/mo. and came with 100TB monthly quota, which is rather hard to saturate. To get the same hardware from the datacenter would have been $600/mo. and only come with 5-10TB monthly transfer.

5

I have a dedicated server. It costs $30 a month and it has 10TB bandwidth. I think most customers use under 200GB bandwidth a month for Netflix. It is a lot cheaper for Netflix because they have data centers.

6

So a VPN is communism

7

Actually VPN providers often do own their own custom made equipment in the data centres. They pay rent to the data centre for storing it as well as for bandwidth costs.

8

So that’s it? Bandwidth is that cheap? How the hell are ISPs all in such an uproar then over Net Neutrality if bandwidth is so petty?

9

how and where can I buy something like that? I want a VPN but I want to set it up on my own. I would only need a 20Mbit line

10

There’s no way that’s a dedicated server. You must have a VPS.

11

To lay fiber to your house is rather expensive.

12

How the hell are ISPs all in such an uproar then over Net Neutrality if bandwidth is so petty?

Watch this movie and pay close attention to the end, where Sean Connery’s character explains the complex motives for the actions he took.

13

It’s cheap at wholesale rates when you buy you bulk.

14

What do you plan to use the VPN for? I can set up a VPN.

15

Kimsufi, OVH, All the ‘seedboxes’, digital ocean, linode, rackspace…

16

To bring it to a single house, sure. When you start doing whole neighborhoods? Drives the price down in a hurry.

Let’s take charter in my area. We’ve been with them for as long since I was at least 4. 25 years they have been able to do a ROI for laying out the lines.

I don’t think we have ever had a "Sorry Charter Customers, we need to redo all the wiring in your neighborhood. "

So that’s 25 years with just maintenance. Even when the pushed everyone up to 60mb, there is still enough headroom in the network.

Any good business that wants to grow, needs to build out. If they want to stay competitive (I guess most ISPs don’t have that issue), then upgrading is part of growth.

17

That was a good book and movie. Such a methodical plan.

18

I’m sure of his needs, but what do you use? $30/month for a dedi w/10tb sounds like kimsufi.

19

Kimsufi, OVH, All the ‘seedboxes’, digital ocean, linode, rackspace

thanks bro

EDIT: I checked OVH and it’s awesome!

20

To bring it to a single house, sure. When you start doing whole neighborhoods? Drives the price down in a hurry.

Each neighborhood consists of lots of single houses, each of which needs fiber / cable directly up to the house. They do termination points in the neighborhood usually, which helps, but they still have to go up to your door, and now they’re limited by upstream bandwidth from your neighborhood to their datacenters.