What Is an IP VPN? Definition, Functionality, and Importance

An IP VPN (Internet Protocol Virtual Private Network) is a secure private network that uses the internet to transmit voice, data, and video. It uses multiprotocol label switching (MPLS) technology to prioritize internet traffic and avoid public gateways.

An IP VPN is like having a private highway for your data, built on the Internet Protocol (IP). It allows you to securely connect different parts of your company’s network across various locations, whether they're in the same city or scattered across the globe.

Businesses often use IP VPNs for various applications, like VOIP for seamless phone communications over the internet, or to provide employees with uninterrupted access to enterprise resource planning (ERP) systems. This is all done securely, using encryption to keep data safe as it travels from point A to point B. 

Whether you’re a small startup trying to go global or a large enterprise managing multiple locations, an IP VPN provides the backbone you need to keep everyone connected securely and efficiently.

How IP VPN differs from other types of VPNs

IP VPNs function at layer 2 of the OSI model, which is like taking a more direct and private route to your destination. Unlike traditional VPNs, which usually operate on layers 3 and 4 and rely on public internet paths, IP VPNs connect sites through a private network. This way, your data isn't just cruising on the internet highways with everyone else. It's got its own VIP pass, ensuring both efficiency and security. 

Take the example of a big corporation with offices scattered around—one in San Francisco, another in Berlin, and a third in Sydney. They need their communications to be fast, secure, and seamless. 

With an IP VPN, the corporation is not just relying on the public internet. Instead, it has a dedicated path that ensures data gets from point A to B without hitching a ride on any old random car. This is crucial for applications requiring high security and low delay, such as financial data exchanges or managing sensitive client information.

In contrast, a typical consumer-grade VPN, like the one you might use to access content that's not available in your region, is simpler. It builds its tunnel over the public internet, not a private network. This setup works just fine for things like browsing privacy and bypassing geo-blocks. But, it doesn't quite cut it when you need the rock-solid reliability that businesses demand.

For instance, imagine if you operated a web-based service that needed to stay up 24/7 without any glitches. Using an IP VPN ensures that your service can withstand surges in traffic and maintain consistent performance. 

That's because it's isolated from the congestion and potential vulnerability of the public internet. The key here is control. An IP VPN gives you more control over your network, allowing you to prioritize traffic and manage bandwidth more effectively.

While both types of VPNs use encryption to secure data, the level of service and reliability that IP VPNs provide makes them unmatched for businesses with large-scale operations and distributed workforces. It's not just about keeping data safe—it's about keeping it flowing smoothly and efficiently across the globe.

Benefits of using IP VPN in Company Networks

Enhanced security

Picture this: your confidential business emails or sensitive financial data are traveling across the globe, yet they’re protected by an invisible armor. With an IP VPN, encryption keeps your data locked away from prying eyes as it moves from one location to another. 

It’s like sending a message in a safe that only the recipient has the key to. That peace of mind is invaluable, especially if you're dealing with sensitive client data or proprietary company information.

Consistency and reliability

Unlike traditional methods that might rely on the public internet, your data traverses a dedicated path. This means it's not subject to the unpredictability of internet traffic. 

Imagine organizing a video conference across three continents that goes off without a hitch—Sydney, San Francisco, and Berlin are all in sync. There are no awkward pauses because someone’s internet hiccupped. That's the kind of stability and performance an IP VPN brings.

Cost-effectiveness

With an IP VPN, you get the feel of a private network without the hefty price tag of setting up direct, point-to-point connections. Think about it as having a streamlined, efficient transportation system without having to build your own roads. 

This can be especially beneficial for startups or mid-sized companies looking to expand globally without breaking the bank. You get scalable solutions that grow with your business. As your company adds more locations, you can easily bring them into your IP VPN. It’s like adding more stops to your secure information highway.

Flexibility

With more employees working remotely or from home, having a system that caters to that is crucial. An IP VPN supports remote work seamlessly, ensuring your team accesses the necessary resources as if they were all in the same office. 

Employees can access critical ERP systems from their home office without disruptions. That’s the kind of flexibility you need in today’s work environment.

Control

With an IP VPN, you can manage and prioritize your traffic more effectively. Say you have critical financial transactions that need to zip through first. You can set things up so they get priority over less urgent data, like someone downloading that massive presentation file. This kind of control over your network’s traffic is invaluable when efficiency and speed are paramount.

Key components and protocols of IP VPNs

Multi-Protocol Label Switching (MPLS)

This might sound like a fancy term, but it's the engine that drives an IP VPN. MPLS directs data from one network node to the next using short path labels rather than long network addresses. Think of it as a super-efficient GPS for your data packets. It ensures your information takes the quickest route, avoiding traffic jams on the network.

Routers

Routers are the workhorses of any IP VPN setup. Imagine routers as the gatekeepers ensuring data only flows where it's supposed to go. They handle the forwarding of packets based on the MPLS labels, making sure that everything stays on track. 

For example, a router in your New York office will ensure the financial transaction data reaches the London office without unnecessary detours. It’s like having a personal courier service for your data.

Edge devices

Examples of these are Customer Edge (CE) and Provider Edge (PE) routers. CE routers sit at the boundary of the customer's network, while PE routers are on the provider’s side. 

These two are like pen pals exchanging letters encrypted with special codes, ensuring only the intended recipient can read them. The PE routers, in particular, play a key role in applying MPLS labels and directing traffic into the appropriate VPNs.

Encryption protocols

IPsec is usually the go-to for securing data over IP VPNs. Whether it’s emails between New York and Tokyo or a file transfer to Sydney, IPsec ensures that nobody can peek inside. It’s crucial for keeping that invisible forcefield around your data, ensuring everything stays hush-hush.

Another important protocol we can’t forget is the Border Gateway Protocol, or BGP. It’s like the telephone operator of the internet, helping different networks talk to each other. 

BGP is responsible for exchanging routing information between the provider and customer networks. So, when a new office in, say, Berlin, comes online, BGP ensures it’s seamlessly integrated into the existing IP VPN setup. It’s the unsung hero making sure every location sees the same picture.

Layer 2 Tunneling Protocol (L2TP) is also worth mentioning. It’s essential for creating the actual tunnel where the data flows. Think of L2TP as the tunnel’s architect, building it on top of the existing internet infrastructure. 

Though not as common as MPLS in business scenarios, L2TP can be a good option for specific use cases, like connecting remote workers securely back to the company network.

How IP VPNs work

An IP VPN operates by creating private, dedicated connections over a shared infrastructure, like a snug, private railway car that glides through a bustling train network. It leverages Multi-Protocol Label Switching (MPLS) technology to enhance the flow and security of data across different geographical locations. 

MPLS acts like a VIP pass for your informaton, directing data efficiently across the network using short path labels instead of complex addresses. This approach means data doesn't take a detour through the congested lanes of the public internet, reducing potential vulnerabilities and interference.

Another key aspect involves the interaction of Customer Edge (CE) and Provider Edge (PE) routers, which are like vigilant gatekeepers. These routers ensure that data stays on its predetermined path. 

For instance, when employees in a New York office communicate with their counterparts in a London branch, the CE routers at these locations will ensure that the data packets flow smoothly to their destination. 

Provider Edge routers on the service provider's side assign the MPLS labels and manage the traffic to prevent any hiccups. Consider these edge devices as trusty conductors on your data train, maintaining order and efficiency.

Then there's encryption, a fundamental part of the IP VPN puzzle. Protocols like IPsec are used to secure data, providing a protective shield, much like an armored vault. IPsec ensures that your data remains confidential and untampered with as you share it.

Overall, IP VPN is a harmonious blend of routing efficiency and robust security, allowing your company’s data to travel across regions as if it was moving within a single, seamless network. This ensures that every branch and remote worker feels like they're just a stone's throw away from each other, no matter where they are in the world.

Types of IP VPNs

Layer 2 VPN

Often referred to as a Virtual Private LAN Service (VPLS), imagine VPLS as extending your office’s local network across multiple locations. It's perfect if you want your New York and Tokyo offices to feel like they're sharing the same floor space, as it connects various sites at the data link layer. 

This type of VPN is ideal for businesses that need to transfer large volumes of data quickly and efficiently between sites, like a media company sending large video files between its production studios.

Layer 3 VPN

Commonly known as MPLS VPN, this one gives a tad more flexibility and is usually what people refer to when they talk about an IP VPN. It's structured around routing protocols, enabling the connection of different IP subnets. 

Imagine being able to sync financial data between your Sydney and London offices seamlessly, as if they were on the same network. It’s great for businesses that prioritize robust routing and need to integrate multiple networks while maintaining secure segmentation. Your finance department might use this to ensure transactions remain confidential across geographic regions.

Site-to-Site IP VPN

This one feels like setting up a private bridge between different office locations. It’s handy for businesses wanting to tie their headquarters with branch offices securely. 

Think about a retail company needing to connect its stores globally to a central inventory system. Each store can communicate just like they’re calling the main warehouse next door, facilitating real-time updates and efficient operations.

Remote Access VPNs

Remote access VPNs cater to the growing trend of remote work. They allow individual employees to securely access the company network from just about anywhere, using their laptops or home computers. 

Picture an employee working from a café, yet being able to access the same resources as if they were in the New York office. This type ensures flexibility and productivity, crucial for companies supporting a dynamic, global workforce.

Each type of IP VPN has its unique benefits tailored to specific needs. From connecting multiple branches to empowering remote employees, the variety available means there's likely a perfect match for whatever your business needs.

Implementing an IP VPN in a company network

Assess the existing network infrastructure

Say you’re the IT manager at a growing tech firm with offices in New York, San Francisco, and Berlin. You’ve got to understand how each location is currently connected and identify the unique needs of each site. 

Perhaps Berlin deals heavily with design files, while New York focuses on financial data. Knowing these specifics is crucial. It’s like planning a road trip—you need to know your starting point and destinations to map out the best route.

Choose the right service provider

This is like picking a reliable travel agency for your road trip. You would look for one that offers robust MPLS services, ensuring that data packets zoom efficiently across the globe. 

For example, a provider known for low-latency routes is helpful, especially if your San Francisco branch frequently holds video conferences with Tokyo. This step ensures you have the backbone to support not just current operations, but future expansions as well.

Set up routers

You are now getting into the technical weeds, setting up the Customer Edge (CE) and Provider Edge (PE) routers. Think of these as toll booths ensuring only the right vehicles, or data packets, pass through. 

For example, your engineers in New York would configure the CE routers to tag data with appropriate MPLS labels, while the PE routers on the provider's side manage these labels across the network. This setup ensures that employees in Berlin can access resources in San Francisco quickly and securely, much like a well-oiled train system.

Implement IPsec encryption to shield our sensitive communications

If you were handling sensitive legal documents in London, you would ensure they’re wrapped in a secure layer as they travel to the legal team in New York. It’s like sealing letters in envelopes stamped ‘Confidential,’ ensuring they’re protected from prying eyes on the internet.

Hold training workshops for employees

Show team members how the IP VPN improves their workflow. For example, sales teams traveling globally must understand how to securely access internal systems. Think of it as teaching them to use their new car's GPS effectively, making sure they reach their destination safely and without detours.

Ensure ongoing monitoring to keep everything on track

Like a conductor ensuring the symphony stays in harmony, you should set up network monitoring tools to catch potential bottlenecks or security threats. For instance, if you spot unusual traffic spikes in the Sydney office, you should investigate and mitigate issues before they disrupt operations. This ensures the IP VPN continues to support the company’s goals smoothly.

How Netmaker Enhances Network Connectivity and Security

Netmaker is a powerful tool for creating and managing virtual overlay networks, making it an excellent solution for businesses aiming to establish secure, efficient connections between geographically dispersed offices. 

By using Netmaker, companies can easily set up a site-to-site mesh VPN, enabling seamless and secure communication between locations such as New York, London, and Tokyo. This is achieved without needing to install software clients on every machine, thanks to the integration capability with non-native devices like OpenWRT, which simplifies network management and ensures consistent connectivity across all sites.

Additionally, with Netmaker's Remote Access Gateway feature, businesses can provide secure access for remote workers, allowing them to connect to company resources from anywhere with the same level of security as if they were in the office. 

This is crucial for supporting a global, distributed workforce while maintaining high security standards. The platform's ability to use Egress Gateways ensures that external networks are accessible while keeping internal communications protected. Sign up with Netmaker to enhance your network connectivity and security.