Atlas VPN, a smaller but well-liked VPN service, is set to close operations on April 24. All current paid subscribers will be transferred to its sister company, NordVPN. It’s just one in a long line of VPNs that have been absorbed by larger security services in recent years.
Citing increased competition and rising costs as the main reason behind the shutdown, Atlas VPN stated that the “insurmountable challenges” had become too much and it could no longer keep up in a highly competitive market.
The popular freemium VPN service was acquired by Nord Security in 2021 with promises that Atlas VPN would continue to operate independently as a business. That’s all changed now though, and the entire user base of around 6 million members will migrate over to the much larger NordVPN after shutdown, continuing an unsettling trend of consolidations in the VPN market as a whole.
The VPN consolidation trend
The global VPN market is valued somewhere in the neighborhood of around $40 billion, so it’s no wonder that tech companies are chomping at the bit to control as much of that fortune as they can. What used to be a diverse market made up of small, independent VPN companies has now become a homogenous security consortium.
Security conglomerates with strong financial backing have systematically bought up and folded these smaller VPNs into their own businesses. Atlas VPN is just the latest example.
Market consolidation is not inherently a bad thing, and mergers are common in the fast-moving world of tech. But these umbrella companies often intentionally obscure their own ownership of VPNs to keep the truth from consumers.
There is something endearing about an independent VPN started and run by a rag-tag team of privacy advocates. And this is exactly the message that these conglomerates advertise even after they have long since bought out smaller VPNs and replaced the original team of founders.
In a 2022 report, VPN Pro identified that 105 of the most popular global VPNs are owned by just 24 companies. That might sound like a lot, but consider that six of the top 10 most popular VPNs are owned by the same three companies: Kape Technologies, Ziff Davis, and Nord Security.
Kape Technologies, formerly known as Crossrider, owns three of the most popular VPNs including ExpressVPN, Private Internet Access, and CyberGhost VPN. The company came under intense scrutiny in 2018 when its Crossrider adware allowed third parties to inject ads into unsuspecting users’ browsers — the company rebranded in order to distance themselves from the scandal.
Ziff Davis, formerly J2 Global Inc, owns top VPNs IPVanish and StrongVPN. It also owns a ton of different tech and media sites, as well. These include Ookla, Down Detector, Encrypt.me, Mashable, IGN, and PCMag.com.
Surfshark merged with NordVPN’s parent company Nord Security in 2022.
Surfshark
Nord Security owns two of the largest VPNs currently on the market: Surfshark and the mega-popular NordVPN. Beyond a data breach in 2021, Nord Security has maintained a relatively clean image despite its massive market share. With the addition of Atlas VPN, Nord is now one of the largest VPN providers in the world.
Market competition is good for VPNs. It drives progress and innovation and keeps prices down. If just a few companies own the majority of VPNs, this means there is less incentive to innovate and prices can be manipulated to suit the company, not the consumer.
In the VPN industry, user privacy is paramount, meaning transparency is crucial in the ownership and operation of any and all of these companies. As a VPN user, you want to make sure that you know which corporations are controlling and managing your data. Mergers can muddy the waters in terms of data ownership and legal jurisdictions.
The liquidation of Atlas VPN and its merger with NordVPN only goes to show that the VPN consolidation trend is here to stay — at least until all of the smaller players are bought up. For consumers, these ongoing mergers and acquisitions mean that an increasingly smaller number of companies will have control over your data. Not only will competitive pricing suffer, but so too will the innovation that comes with a rich and diverse VPN ecosystem.
